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As we reported earlier this month, Craigslist, after a slew of negative press and pressure from various political organizations, decided to revamp its 'erotic services' section. For South Carolina's Attorney General, Henry McMaster, this was not enough of a change, however, and last week, McMaster announced that we would still file charges against the classified-ad site as, according to him, "the Craigslist South Carolina site continues to display advertisements for prostitution and graphic pornographic material."

In return, Craigslist has now filed its own suit in federal court in South Carolina, "seeking declaratory relief and a restraining order with respect to criminal charges he [McMaster] has repeatedly threatened against Craigslist and its executives."

Craigslist, the popular online classifieds service, announced a major revamp of its "erotic services" section today, which, until now, featured copious amounts of ads for prostitutes and escort services. The "erotic services" section will be closed and will be replaced by an "adult services" section, where Craigslist's customer service reps will review every ad before it can be posted. This decision comes after pressure from various political organizations on Craigslist mounted, and after the attorneys general of Connecticut, Missouri, and Illinois met with officials from Craigslist last week.

In an era where user generated content is changing our entire culture, rare is the company that can successfully harness the collective creativeness of its community, cultivate loyalty, make money consistently, and continue to flourish. Enter Craigslist. Listed as the tenth top site in America on Alexa and with close to 50 million unique visitors a month according to Compete, Craigslist is one of the few companies that appears to have worked it out.

Yesterday, at the User Generated Conference in San Jose, CA, founder Craig Newmark gave us an insight into what has and what hasn't worked for the privately held company.