[Jack Goldsmith and I will have an article out about the Dormant Commerce Clause, geolocation, and state regulations of Internet transactions in the Texas Law Review early next year, and I'm serializing it here. There is still plenty of time for editing, so we'd love to hear any recommendations you folks might have; in the meantime, you can read the entire PDF of the latest draft (though with some formatting glitches stemming from the editing process) here.]
The same basic analysis [as we laid out for tort law yesterday] applies to laws aimed at protecting not the subjects of speech on internet sites but rather the users of internet sites. Such laws are generally upheld against a Dormant Commerce Clause challenge, at least if they are limited to transactions with users in the state, and the site operators are able to at least roughly determine whether a user is in that state.
Let's begin with the Ninth Circuit's decision in Greater L.A. Agency on Deafness, Inc. v. CNN, Inc.[1] The California Disabled Persons Act (DPA) required CNN to provide closed captioning on programs accessed on the internet in California.[2] Such a requirement would require CNN, which is headquartered in Georgia, to create the closed captioning because California told it to do so. And of course the easiest way for CNN to comply with the California law would be to provide such closed captioning to everyone else in the country, which would affect not just CNN's Georgia-to-California communications (which at least would be "present" in some sense in California) but also its, say, Georgia-to-Texas communications (which would be purely extraterritorial with respect to California).
