The ruling caused controversy among early supporters of the Internet, including some lawmakers, leading to the passage of Section 230 of the Communications Decency Act in 1996.

In October 1994, an unidentified user on Money Talk submitted a post claiming that Stratton Oakmont, a securities investment banking firm based in Long Island, New York, and its president Danny Porush, had committed criminal and fraudulent acts in connection with a stock IPO.

[2] Stratton Oakmont argued that Prodigy should be considered a publisher of the defamatory material, and was therefore liable for the postings under the common law definition of defamation.

Prodigy requested a dismissal of the complaint, on the grounds that it could not be held liable for the content of postings created by its third-party users.

[3] The Stratton court held that Prodigy was liable as the publisher of the content created by its users because it exercised editorial control over the messages on its bulletin boards in three ways: 1) by posting content guidelines for users; 2) by enforcing those guidelines with "Board Leaders"; and 3) by utilizing screening software designed to remove offensive language.