The Hot News Doctrine Rides Again

by Paul Alan Levy

 Does a firm that expresses an opinion "own" that opinion, and thus have the ability to prevent others from reporting on the fact that the firm has expressed the opinion?  When a newspaper or other entity reports some facts, does it "own" the news and can it prevent others from truthfully reporting the same facts?  Granting ownership in important public facts would seem to be at odds with intellectual freedom, yet it takes resources to develop the facts and news organizations have been struggling to invoke concepts of ownership as a way to ward off competition for readers from online news web sites that re-report what the established media are reporting.

A ruling yesterday by U.S. District Judge Denise Cote holds the online financial reporting firm theflyonthewall.com liable for both copyright infringement and misappropriation for engaging on the business of obtaining trading recommendations issued by the financial analysts at major brokerage and investment firms and publishing them before the market opens.  As in many situations involving a hot news claim, the defendant was also republishing copyrighted content, thus making it much harder to sympathize with the defendant. At the same time, one might well wonder why copyright law does not provide sufficient protection for the public interest in encouraging the creation of the underlying intellectual work, and whether the threat to freedom posted by the hot news doctrine is justified as a matter of public policy by a need to foster the creative endeavor.  

Although the so-called hot-news doctrine has been acknowledged in strong dicta in a number of Second Circuit cases, most notably NBA v Motorola in 1997, that court has not issued a holding in the modern era on whether the Supreme Court’s World War I era ruling in International News Service v. Associated Press survives either copyright preemption or the First Amendment.  With the defendant declaring its intent to appeal, the case will likely set up a major test of this hoary doctrine.

Comments

[Marc J. Randazza]

I am uncomfortable with granting IP rights over facts as well. However, I see the point in the "hot news" doctrine -- that perhaps there should be some kind of protection granted for a *very limited* time so as to incentivize the gathering of hot news in the first place.

Of course, I see the potential slippery slope -- especially with that asshole Scalia on the court, with his "infinity minus one second equals a 'limited time'."

[jdgalt]

This sounds to me more like a professional advice-giver trying to protect his work product. How would you, as an attorney, feel if one of your clients started passing along your advice to lots of other people (assuming it was somehow applicable to all those people, as financial advice often is)?

I don't see how you can say this is wrong without rejecting all copyright.

[Bill Bennett]

I was always told raw facts are the one thing that can't be copyrighted, but the expression of those facts is protected.

So what's happening here?

[Jason]

Actually, you don't need to add any opinion. It's a first mover copyright for facts - something which can't typically be protected.

[Martin]

So if I am on the scene of a newsworthy item and tweet on it from my cell phone with my opinions added I get "ownership"? And so can stop the newspapers reporting similar views? Hmm. I can't see that going down to well...