If you care about legal issues, this is a must read post from Real Estate, Real Competition, and The Law. Chicago Lawyers’ Committee for Civil Rights Under the Law (CLC) sued Craigslist for violating the Fair Housing Act and got pretty much slapped around by the trial court. CLC appealed, and the Seventh Circuit heard the appeal.

The blogger, Michael Erdman, spent a great deal of time and energy reporting on the actual oral arguments. Having been to a court hearing or two myself, I know just how incredibly boring that can be. He deserves a great deal of thanks for the work he’s done here.  Seriously, read the whole thing.

This case is important not just for real estate, but for the internet industry as well.  If Craigslist is found guilty of violating FHA because its members posted ads that are, that creates all kinds of problems for all web-based advertising businesses, social networks, and the like.  At issue is whether a web-based message board has a duty to filter content — or at least attempt to filter content — to keep objectionable ads off its system.

Again, forcing companies like Craigslist and eBay to filter content proactively is going to have immense implications for companies like Facebook, MySpace, and others.  In real estate, such a rule would have enormous implications for FSBO sites, as well as non-FSBO listing sites in terms of proving some sort of an affirmative filtering mechanism.

In concluding, Mr. Erdman expects to see a unanimous affirmance of the trial court’s ruling to dismiss the case against Craigslist.  I hope so.