Backpage CEO Carl Ferrer Arrested Over Escort Ads

Backpage.com CEO Carl Ferrer was arrested Thursday in Texas on sex trafficking charges stemming from escort ads on the classifieds site.

The arrest came around one week after California Attorney General Kamala Harris quietly filed a criminal complaint against Ferrer and Backpage shareholders Michael Lacey and James Larkin.

The complaint includes allegations that Backpage.com accepted payment for escort ads featuring minors.

Ferrer also allegedly "directed the creation" of two other sites -- EvilEmpire.com and BigCity.com -- and then "used content from escort advertisements on Backpage.com to create advertisements" on the other two sites. The complaint doesn't elaborate on the significance of allegations relating to EvilEmpire.com and BigCity.com.

Ferrer's arrest is striking, given that Backpage has prevailed in more than one lawsuit stemming from its controversial ads.

Earlier this year, the 1st Circuit Court of Appeals ruled that sex trafficking victims couldn't proceed with a lawsuit accusing Backpage of facilitating crime through the design of its online classifieds site.

The court in that case ruled that Backpage was protected by the federal Communications Decency Act, which immunizes Web companies for crimes committed by users.

Last year, the 7th Circuit Court of Appeals also handed Backpage a victory by enjoining Cook County, Illiois Sheriff Thomas Dart from continuing to try to persuade credit card companies to stop working with Backpage.

But Backpage lost a battle last year in Washington, where the state Supreme Court refused to dismiss a lawsuit against the company by three minors who said they were raped by adults who responded to ads on the site.

The Washington Supreme Court said the Communications Decency Act doesn't protect Web sites that "develop" objectionable content, as opposed to sites that merely "host" the content. The judges ruled that Backpage couldn't get the case dismissed at an early stage, because there were factual questions about whether the company developed the ads.

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