Obsolete Hot News Doctrine Back In The News As Bloomberg Is Sued For Reporting Too Quickly

from the oh-come-on dept

It's been a few years since we've really talked about the Hot News doctrine, which was a mostly obsolete and, frankly, bizarre attempt to turn the idea of publishing a similar news story too quickly after the original reporters broke the story into a form of "misappropriation." It stems from the International News Service v. Associated Press case from a century ago (literally: 1918), in which the AP argued that even though there is no copyright in facts, having INS release a similar story too quickly to AP's articles was a form of "misappropriation" of its "hot news." Incredibly, the court agreed. However, multiple later cases, plus the entire rewriting of copyright law in 1976 had most people believing that the entire concept of "hot news" was obsolete and effectively dead.

Indeed, in 2003, Judge Richard Posner suggested that the entire concept "can be jettisoned" and he later committed to that in some of his rulings. However, around 2010, a variety of hot news cases popped up, and yet basically all of them have been losers (the one exception I can think of being a default judgment where the defendant didn't even show up).

Still, over the last few years it felt as though we were back to the general feeling that "hot news" was a dead letter. Except... DC news organization Capitol Forum is now suing Bloomberg under the Hot News doctrine, in yet another attempt to revive the silly concept. The complaint makes a valiant effort, but one that seems likely to fall way short. The lawsuit also argues copyright infringement, and we'll get to that in a second, but the attempt at crying "hot news" seems particularly week:

In addition to violating Capitol Forum’s copyright protection, Bloomberg’s conduct also violates Capitol Forum’s proprietary rights under the common law tort of “hot news” misappropriation. This doctrine prohibits free riding by competitors. It prohibits a direct competitor from acquiring and republishing time-sensitive news and analysis generated by its competitor and intended only for its competitor’s subscribers and authorized recipients.

The timeliness of business and financial news reporting is essential to Capitol Forum’s subscribers. Bloomberg competes directly with Capitol Forum for subscriptions by end-users, and Capitol Forum and Bloomberg’s products are marketed and sold to the same customer base. Bloomberg’s conduct in this regard necessarily diverts business opportunities from Capitol Forum.

This free riding on Capitol Forum’s reports impairs Plaintiff’s incentive to provide that reporting as an exclusive service to its existing subscribers and to potential new clients. To the extent that Plaintiff is deprived of the intended exclusivity of its reports as a result of its being made available by Bloomberg, such conduct by Bloomberg reduces the value of the reports to Capitol Forum’s subscribers. It has already caused Capitol Forum subscribers to cancel their subscriptions because they can obtain the same Capitol Forum news and analysis from Bloomberg’s First Word service. If left undisturbed, Bloomberg’s conduct inevitably will, among other things, adversely affect Capitol Forum’s willingness to continue to make substantial investments in generating and distributing such reports

This argument may have been successful in the 1920s, but given all of the precedent against this kind of thing between now and then, it seems like quite a stretch to think that courts will be willing to bring back Hot News -- especially given the 1976 Copyright Act, which more or less pre-empts any state law attempts to create copyright-like regulations.

So what about the copyright claims in the lawsuit? That may come down to specifics, but from Capitol Forum's own description of what is happening, it seems like a difficult case to make:

On numerous occasions, Bloomberg has impermissibly solicited and obtained Plaintiff’s proprietary reports, has copied and quoted the most creative and original aspects of the reports, has published its own summary or abstract of the content of the reports in the form a “news alert,” and has distributed these “news alerts” to its own subscribers on its “First Word” news service. While Bloomberg cites Capitol Forum as the source of its summaries and abstracts, it does not undertake creative or journalistic efforts of its own to transform Plaintiff’s work into something new or different from Capitol Forum’s original report. Other than including a current market price or a reference to a past article, Bloomberg does not add any of its own analysis or contribute any meaningful reporting to Plaintiff’s work. Bloomberg’s “news alerts” simply extract the key information from Plaintiff’s reports, and repackage Capitol Forum’s work in a bullet-point form for a quick read. The purpose of Capitol Forum’s reports and Bloomberg’s “news alerts” are precisely the same: to inform their subscribers of Capitol Forum’s copyrighted and proprietary reporting. Bloomberg’s conduct constitutes direct infringement of Plaintiff’s exclusive right under the Copyright Act to reproduce, use, and control its copyrighted works.

The filing, notably, provides no actual examples of the copying. And from this description, it certainly sounds quite possible that Bloomberg is not infringing at all. Quoting other sources is likely to be fair use, and repackaging their work "in bullet-point form for a quick read" could certainly be seen as transformative in a fair use analysis. Indeed, Capitol Forum flat out admits above that Bloomberg has "published its own summary of the content, which again suggests fair use and not infringement. The whole thing seems to be a situation of Capitol News trying to plead a hot news claim under copyright law (which isn't going to fly at all). Of course, specific examples might result in a different analysis, but if the infringement argument was strong, you'd think the actual complaint would demonstrate it much more clearly (including identifying actual examples of the copyright-covered content being copied).

There are two other elements in the filing that seem worth commenting on. First, in an attempt to claim that this infringement is "willful" Capitol Forum points to an important fair use case (also filed against Bloomberg) in which the 2nd Circuit ruled that Bloomberg reposting an entire earnings call was fair use (i.e., a win for Bloomberg). However, Capitol Forum is pointing to Bloomberg's filings in that case saying that there the company "conceded that the fair use exception does not apply when the copyrighted material is based on an analysis—and is not just reporting 'facts.'" That... seems unlikely to be a fair or accurate statement of Bloomberg's position. There are many cases in which fair use applies to analysis and not just facts.

There's also this:

Bloomberg’s knowledge is also demonstrated by Bloomberg BNA’s copyright guideline, which states that it is a copyright violation to summarize a Bloomberg article.

And the simple response there is that Bloomberg BNA's internal guidelines are (a) legally meaningless and (b) bullshit. That's not an accurate statement regarding copyright law. It is not a copyright violation to summarize anyone's articles.

The other interesting element of the filing is the claim of vicarious infringement, in that Capitol Forum argues that a Bloomberg employee, Joshua Fineman, induced a Capitol Forum subscriber to pass along its news alerts.

For example, commencing around December 2016, and continuing through December 2017, Joshua Fineman of Bloomberg’s First Word news service induced one of Capitol Forum’s subscribers, a West Coast hedge fund, to provide him with Capitol Forum reports in exchange for providing the hedge fund with market information that it did not possess. This arrangement continued until Capitol Forum learned of its subscriber’s actions and demanded that they stop. The hedge fund informed Mr. Fineman that it would no longer agree to trade information with him. In response, Mr. Fineman acknowledged that their actions were illegal and stated that he would not put the hedge fund in that position again. Despite this recognition of illegality, Mr. Fineman continues his infringing activities with respect to other Capitol Forum subscribers. Mr. Fineman continues to induce and encourage other Capitol Forum subscribers to directly infringe Capitol Forum’s copyright protections by soliciting those subscribers to send Capitol Forum copyrighted articles to him.

As such, Mr. Fineman and Bloomberg have induced, caused, encouraged, and materially contributed to the direct infringement by Capitol Forum’s subscribers. Mr. Fineman and Bloomberg are aware that the Capitol Forum material is copyrighted and that Capitol Forum subscribers who transmit these reports violate Plaintiff’s copyright by sending them to Bloomberg.

It is possible that this part of the filing might create a bit more of a headache for Bloomberg. Even if the practice of forwarding such emails is not just standard across industry, but practically second nature to almost everyone, it might still be seen as infringing. Still, it does seem like Capitol Forum's bigger issue, then, would be with the subscribers who are infringing on their works directly by distributing its alerts, but (not surprisingly) the company probably is less interested in suing its own customers -- especially when they likely have smaller pockets that Bloomberg.

No matter what, this will be an interesting case to follow, but hopefully not one that gets very far, especially in its attempt to revive "Hot News."

Filed Under: breaking news, copyright, hot news
Companies: bloomberg, capitol forum

Ridiculous Hot News And Copyright Battles As World Chess Seeks To Block Others From Broadcasting Moves

from the that's-ridiculous dept

A few years back, we had a few stories about ridiculous situations in which the Bulgarian Chess Federation was trying to claim copyright on chess moves and had even sued a website for copyright infringement for broadcasting the moves. Of course, chess moves are not just factual information, but they're historically written down and shared widely, because that's part of how people learn to play chess (and get better at it). Studying the moves in various games is part of how people practice chess, and no one is expected to claim "ownership" over the chess moves, because they can't.

And yet... we've just come across two separate cases, involving one particular organizer of chess tournaments, trying to abuse the law to block reporting on chess moves -- in both Russia and the US. Both cases are ridiculous, and thankfully, both have failed so far. The Moscow case actually kicked off back in the spring, when the organization Agon, which runs World Chess Championships and the website WorldChess.com, sued some websites, including Chess24, for posting the chess moves of live events. Thankfully, the Commercial Court of the City of Moscow rejected the lawsuit a few weeks ago, though Agon has said it will appeal. There are a number of reasons why Agon lost the case, but the key one:

Art. 14.7 of the Competition Act does not apply in particular since the Plaintiff did not establish a regime of commercial secrecy for the information about the chess moves. On the contrary, this information was in the public domain (as the Plaintiff himself admits on page 6 of the statement of claim). Consequently, information about the chess moves is not a trade secret and is not protected by law. Accordingly, the Defendant did not receive, use or disclose information that was a trade or other secret protected by law i.e. he did not violate Art. 14.7 of the Competition Act.

Then, just days after that ruling in Moscow, a very similar case was filed in the US by World Chess -- which is owned by Agon. And, it also targeted Chess24, one of the same companies it had sued in Moscow. In the US, it's clear that there's no copyright claim to be made in chess moves -- too many cases clearly preclude trying to claim a copyright in factual data, especially factual data about sports/competitions. Instead, World Chess focused on the pretty much dead and discredited "hot news" claims against a few other chess sites. The entire complaint can basically be summarized as "but... wah... it's not fair!"

Defendants have made a pattern and practice of copying and redistributing in real time the chess moves from tournaments covered byWorld Chess shortly after the moves appear on World Chess’s website, and unless restrained by this Court will do the same with respect the November 2016 Championship.

World Chess not only asked for an injunction against Chess24 -- but also demanded that the court order the domains of the defendants be transferred over to World Chess. The defendants hit back with a detailed explanation of how ridiculous World Chess's lawsuit was:

By its Application for a Temporary Restraining Order and Preliminary Injunction, Plaintiffs World Chess US, Inc. and World Chess Events Ltd. (collectively, “Plaintiffs”) seek to prevent legitimate chess-oriented websites from reporting on, discussing, and analyzing one of the major chess matches of the year – even though the information Chess24 seeks to report on will already be readily available to the public. Plaintiffs attempt to do so by claiming that because they are the organizers and promoters of the chess match they have an intangible, enforceable property right in the facts surrounding that match, and therefore have the exclusive right to publish and report on what the players are doing. The claims made by Plaintiffs run contrary to the well-established law of this Circuit and public policy.

Chess24 points out that World Chess is clearly just trying to do an endrun around well-established copyright law, and that's a big no-no.

Plaintiffs know that the moves made by professional chess players are precisely the type of factual material that is not protectable by copyright law. But it also cannot be protected under theories of common law misappropriation. The law is absolutely clear in this Circuit that state law claims for misappropriation of unprotectable facts – including live sports plays – are preempted by Section 301 of the Copyright Act. In an effort to avoid preemption, Plaintiffs have relied on an extremely narrow exception for so-called “hot news misappropriation.” That exception plainly does not apply here. In fact, Plaintiffs almost completely ignore the dispositive case in this area -- NBA v. Motorola, 105 F.3d 841, 846 (2d Cir. 1996). In Motorola, the Second Circuit expressly rejected the exact same claim that Plaintiffs attempt to argue here, involving almost the exact same factual circumstances. Specifically, that case held that the NBA could not prevent Motorola from attending and watching basketball games and selling play-by-play accounts of the game to its mobile customers. In contrast to this dispositive case law, Plaintiffs are unable to cite even a single case upholding an injunction like the one sought by Plaintiffs in even remotely similar circumstances.

Oh, and also, Chess24 points out to the court that (1) Agon/World Chess just lost a nearly identical case in Moscow and (2) it waited until just days before the tournament in question started to try to force a quick injunction:

Even more telling is the fact that although Plaintiffs have been in litigation with Chess24 in Moscow since March (Plaintiffs recently lost that case), they waited until just four days before the start of the WCC to bring this motion. Plaintiffs’ decision to file their lengthy motion at the eleventh hour is not just sharp tactics; it confirms that there is no actual irreparable injury in need of remediation.

There was a hearing in court, and the judge, Victor Marrero, rejected World Chess/Agon's request for an injunction. As of writing this, the court has only posted the short order without the full explanation, which is expected to be published later. But, given the facts here, it seems fairly obvious why the court rejected the case -- and it's all of the many reasons that Chess24 laid out in its brief.

Hopefully, these companies can finally get it through their heads that you can't copyright chess.

Filed Under: chess, chess moves, copyright, hot news
Companies: agon, chess24, world chess

Judge Issues $5 Million Award To Dow Jones In Hot News Case... But It's Meaningless

from the hot-news? dept

In January, we wrote about Dow Jones suing Ransquawk, a UK-based service that sends out news alerts to clients. Dow Jones used the antiquated and obsolete concept of "hot news" misappropriation, since there was no actual copyright claim to be made. For years, we've discussed the problematic nature of the hot news doctrine, which some news companies just can't let go of using. In May, we noted that Ransquawk basically ignored the legal process (though it had publicly commented on the lawsuit), leading to a default judgment against Ransquawk. That's what happens when you don't show up in court. This week, the judge officially awarded Dow Jones $5 million in the case, which is again fairly meaningless. In theory, Dow Jones can go after Ransquawk for the money, but it doesn't appear that it has any US-based assets to attack.

While some who don't follow the details and don't understand the nature of a default judgment may make a bigger deal of this, the ruling is kind of meaningless since there was no actual adversarial process here. But, really, the bigger issue is that hot news is just a concept that needs to go away. In an age of social media sharing, retweeting, forwarding, reposting, etc., the idea that someone can claim some sort of exclusive ownership over "breaking" news is just silly and pointless. If your entire value is wrapped up in being a few minutes ahead of the competition, and you can't stand someone repeating the news that you were still first in getting out, you've got other, much more serious problems with your business model.

Filed Under: default judgment, hot news, misappropriation, news, squawk services
Companies: dow jones, ransquawk

Big Win For Fair Use (Even When For Profit), Big Loss For 'Hot News' & Fox

from the good-news dept

Well, here's a nice surprise. The Federal Court in the Southern District of NY has issued another very nice ruling on copyright issues relating to fair use. As we'd mentioned last year, Fox had sued the company TVEyes claiming copyright infringement. TVEyes is a media monitoring company that records tons of TV and radio, creates transcripts of it all and makes it searchable for internal use. Customers include the White House, Congress and a variety of news services, including the NY Times. Fox is Fox. It insists that what TVEyes is doing is infringement and that it violates the hot news doctrine (the silly, obsolete, court-made law that says news reporters have some non-copyright proprietary right to breaking news they first publish).

Judge Alvin Hellerstein, however, is not buying Fox's argument. Why? Fair use. The Court goes through the typical four factors test and finds them to pretty squarely put TVEyes' usage into the "fair use" camp.

1. Purpose and character of the use: Goes to TVEyes following a very long discussion. Even though it's a "for profit" company, the court says that its transformative and fits with the stated purpose of fair use. The court relies heavily on the recent book scanning decisions that found that scanning full books to make searchable indexes is transformative fair use. That's good. It also points to the recent Swatch v. Bloomberg case, in which a full transcript of an investor call was considered fair use, even if for commercial reasons. The court admits that the Meltwater case may be the one that goes against this, but notes that it's basically the only one (adding emphasis to our belief that Meltwater was decided incorrectly). The growing consensus appears to be that indexing content to make it more findable is transformative fair use, and the court agrees in this case:

   I find that TVEyes' search engine together with its display of result clips is transformative and "serves a new and different function from the original work and is not a substitute for it." ... In making this finding, I am guided by the Second Circuit's determination that databases that convert copyrighted works into a research tool to further learning are transformative. TVEyes' message, "'this is what they said' -- is a very different message from [Fox News'] -- 'this is what you should [know or] believe.'" ... TVEyes' evidence, that its subscribers use the service for research, criticism, and comment, is undisputed and shows fair use as explicitly identified in the preamble of the statute.

   
   
2. The nature of the copyrighted work: Here the judge finds neither side wins the fair use debate. Basically, he says "where the creative aspect of the work is transformed, as is the case here, the second factor has limited value."
   
   
3. The amount and substantiality of the portion used: Once again, neither side wins. The court says, yes, obviously, TVEyes is using all of Fox's TV content, but rather than taking the simple way out, recognizes (as other courts have) that this is really not about the total amount used, but the amount used in relation to the amount necessary to use. And thus, in this case, using everything is necessary, given what TVEyes is trying to do. As the court notes, "TVEyes' service requires complete copying twenty-four hours a day, seven days a week."
   
   
4. The effect of the use upon the potential market for the value of the copyrighted work: This one goes to TVEyes again. As the court notes, the economic harm here has to be based on whether or not TVEyes is acting as a substitute, and not based on any economic harm created by the transformative use (i.e., not from a market that Fox isn't serving). The court notes that Fox speculates that people might use TVEyes to avoid watching Fox directly, but has no evidence to support that: "Fox News' allegations assume that TVEyes' users actually use TVEyes as a substitute for Fox News' channels. Fox News' assumption is speculation, not fact. Indeed, the facts are contrary to Fox News' speculation." More specifically:

   First, none of the shows on which Fox News' suit is based remain available to TVEyes subscribers; TVEyes erases content every 32 days. Second, in the 32 days that these programs were available to TVEyes' subscribers, only 560 clips were played, with an average length of play of 53.4 seconds and the full range of play being 11.5 seconds to 362 seconds. Of the 560 clips played, 85.5% of the clips that were played were played for less than one minute; 76% were played for less than 30 seconds; and 51% were played for less than 10 seconds. One program was not excerpted at all. The long term TVEyes statistics are consistent with the specific statistics of the 19 programs. From 2003 to 2014, only 5.6% of all TVEyes users have ever seen any Fox News content on TVEyes. Between March 31, 2003 and December 31, 2013, in only three instances did a TVEyes subscriber access 30 minutes or more of any sequential content on FNC, and no TVEyes subscriber ever accessed any sequential content on FBN. Not one of the works in suit was ever accessed to watch clips sequentially. The record does not support Fox News' allegations. Fox News fails in its proof that TVEyes caused, or is likely to cause, any adverse effect to Fox News' revenues or income from advertisers or cable or satellite providers.

   It goes on in that nature for some time. And then concludes: "No reasonable juror could find that people are using TVEyes as a substitute for watching Fox News broadcasts on television. There is no history of any such use, and there is no realistic danger of any potential harm to the overall market of television watching..."

Given all that, the victory goes in a landslide to TVEyes on fair use grounds -- with one exception:

However, I do not decide the issue of fair use for the full extent of TVEyes' service, TVEyes provides features that allow subscribers to save, archive, download, email, and share clips of Fox News' television programs. The parties have not presented sufficient evidence showing that these features are either integral to the transformative purpose of indexing and providing clips and snippets of transcript to subscribers, or threatening to Fox News' derivative businesses.

So that part of the case is likely to go forward (though it may wait while Fox appeals the other part).

The court also tosses out the hot news claim, saying that it's preempted by the copyright claim, and Fox News' attempt to double dip via hot news won't be allowed. It cites a case that says if you're just reposting factual information, it's covered by the Copyright Act. The court notes for TVEyes to run afoul of the hot news doctrine, it would need to be "free riding" in a manner designed to "scoop" Fox's efforts, rather than accurately covering what Fox is broadcasting. "TVEyes is not a valuable service because subscribers credit it as a reliable news outlet, it is valuable because it reports what the news outlets and commentators are saying and therefore does not "scoop" or free-ride on the news service."

In the end, it's a good ruling for fair use (and against hot news), though it seems likely that Fox will appeal.

Filed Under: copyright, fair use, fox news, hot news, media monitoring, sdny
Companies: fox, tveyes

Dow Jones Wins Default In Questionable 'Hot News' Case

from the please-make-hot-news-just-go-away dept

For years, we've been covering the dangerous "hot news" doctrine, a court created form of intellectual property protection that had been considered almost entirely dead, but which is technically still the law in New York, relying on a century old court ruling, that allowed a publication to claim that another publication couldn't report the same news when it was still "hot." About five years ago, a few legacy media players tried to revive the hot news doctrine after online competitors were getting attention for spreading the news that those legacy players were too slow (or too expensive) to help spread. Earlier this year, we noted that Dow Jones had filed a hot news lawsuit against Ransquawk, a so-called "squawk" service that provides near-real-time news updates, often to stock traders.

While Dow Jones had initially threatened the company with copyright infringement, someone realized that there's no copyright in headlines or factual news, which is basically all Ransquawk was sharing. Ransquawk had responded to initial threats from Dow Jones by pointing out that it got its information from a variety of sources, but apparently decided not to respond at all to the lawsuit. Because it didn't respond at all, the court found Ransquawk in default and has now granted an injunction against Ransquawk, saying it can't get someone with lawful access to Dow Jones to share their account, it can't pass on any Dow Jones content prior to that content being published on the web or in print, and it can't market its products to suggest that it will help people get access to Dow Jones content (even if it's true...).

Ransquawk responded to the ruling by noting somewhat accurately:

Ranvir Singh, the chief executive and a co-founder of the London-based Ransquawk, said in an emailed statement Friday that Dow Jones's case against Ransquawk is unconstitutional because it precludes free speech.

"Hot news misappropriation is an antiquated law, recognized in only 5 U.S. states and completely unrecognized in the U.K. and [European Union]. If we are guilty of it, then so are a multitude of other news aggregators," he said. The decision "truly flies in the face of modern practicality where news is transmitted across the globe in seconds, irrespective of who initially published it."

He added that fighting the claim would bankrupt Ransquawk as a company, and in the U.S. the company wouldn't even be able to claim its costs back.

That explains why he didn't respond to the lawsuit... but it also explains the result. Most US courts will simply give the party filing the lawsuit exactly what it wants if the other side doesn't show up. That's what a default judgment is. In this case, though, it's extra problematic because it may inspire others to think that hot news is a legitimate doctrine, even though the issue wasn't fully adjudicated here, but was rather decided on default.

It would be nice if we could just make it clear that the hot news doctrine violates the First Amendment and stop having to see these kinds of cases altogether.

Filed Under: default, free speech, hot news, journalism, squawk service
Companies: dow jones, ransquawk

Dow Jones Files Idiotic 'Hot News' Lawsuit Against A Service That Sends News Alerts

from the opening-a-can-of-worms dept

For a few years now, we've been covering the troubling return of the "hot news" doctrine. This is a non-copyright concept that was mostly considered dead and buried, but was suddenly revived a few years ago. Technically, it's still considered "law" in New York, and it involves the idea that there's some sort of "protection" in news, such that others can't re-report the news that others have reported if it's "too soon." Under basic copyright, of course, facts are not copyrightable, so it's always been considered fair game to repeat factual news information (so long as you're not copying specific expression). The whole hot news concept had basically become defunct before the Associated Press brought it back up in a lawsuit about five years ago. Of course, there are all sorts of troubling implications of creating a new form of intellectual property such as "hot news" -- especially in an age of Twitter, Facebook and other methods of sharing news and information. Already, some have sought to stretch the definition of hot news. So far, thankfully, most recent hot news lawsuits have failed in court, though many seem to end in "settlements."

One of the "settled" cases was brought by Dow Jones a few years ago, and apparently the company has decided to try again. It has filed a hot news lawsuit against a company almost no one has heard of (until Dow Jones just gave them a ton of free publicity), Ransquawk.

In Dow Jones' initial cease and desist letter, it claimed that Ransquawk violated its copyrights, but apparently the lawyers at Dow Jones finally figured out how copyright works and realized that wasn't true. The lawsuit only makes use of the hot news concept.

In its defense, Ransquawk explained to Dow Jones that it does not have an account from Dow Jones' DJX service, which Dow Jones says Ransquawk is illegally copying, but rather that it finds the information from Twitter, Dow Jones reporters themselves and various other services who often share the same headlines. Since Ransquawk is a UK company, it also rejects the copyright claims, pointing out that news reporting is considered fair dealing under UK law.

The actual lawsuit makes some brazen claims:

How does Ransquawk provide such a popular service? Its business model is as simple as it is illegal: Ransquawk's audio and text services are based on the systematic unauthorized reproduction and redistribution of news content published by Dow Jones, and undoubtedly other news content providers as well.

But, again, repeating a news headline is not illegal. The complaint also insists that Ransquawk is lying in claiming that it's obtaining the news from other sources, noting that sometimes Ransquawk is repeating the DJX news within five seconds, which suggests it has access to a direct feed, despite denying it. It's entirely possible that someone is violating DJX's terms of service, to allow Ransquawk to have access to the feed, but that's a completely different matter than hot news.

While Ransquawk may follow in the footsteps of others and settle this case to be done with it, this remains a really stupid move by Dow Jones -- a company that quite frequently has its own staff repeating and sharing news first reported elsewhere. It's not difficult to see how any precedent Dow Jones might set with this lawsuit will almost certainly come back to bite them when others realize that Dow Jones does the same exact thing. News is news: it's factual and sharing the news is just a part of how the world works today. Rather than freaking out about it, Dow Jones should focus on adding the kind of additional value that it claims to add, such that mere headlines from Ransquawk won't make a difference. Seriously, if the only value that Dow Jones provides is somehow "misappropriated" by Ransquawk then it makes me think that Dow Jones really doesn't provide much value at all.

Filed Under: hot news, intellectual property, news alerts
Companies: dow jones, news corp., ransquawk

Healthcare, Journalism, And The Mad Dash For 'The Scoop'

from the getting-back-to-insights dept

As you may have heard, when the Supreme Court came out with its ruling on healthcare, CNN and Fox News jumped the gun and incorrectly reported that the Court had struck down the individual mandate. Fox News corrected the mistake pretty quickly. CNN took a bit longer (and spread the false "breaking news" story far and wide). The whole thing even had President Obama confused for a little while.

It was, of course, also great for late night television. People are referring to this as cable news' "Dewey defeats Truman" moment, while others are arguing that "breaking news is broken." Of course, being a part of the "blogging" world which is often accused by "old media" types of publishing untrue things... there is some element of schadenfreude in being able to see it made clear that the mainstream media is often no better at publishing incorrect things. Of course, some tried to flip this around, and suggest that the problem actually came about because of "new media" thinking around things like "process journalism," though there's a strong argument that reporting before reading something isn't process journalism, it's just bad journalism (i.e., process journalism is about reporting things as additional news comes out -- but in this case, the news was out, the problem was people reporting it before reading it).

A few years ago, uber-blogger Mike Arrington said something that has quite a lot of truth to it: to get attention as an online media player, you generally have to be first, funny or insightful -- and being first is often the easiest, so lots of people concentrate on that. It's the chase for "the scoop." Being funny is powerful, but very, very difficult. And... being insightful takes a lot of time and effort, and is no guarantee of attention. Generally speaking, our goal here has never been to be first with news (in fact, we often wait for others to publish so that we can link to their reports in what we write up). Personally, I like that much better. Focusing just on "the scoop" may be good for traffic in the short term, but especially for big stories like this one, I'm not sure how much value it creates in the long term.

Of course, the realities of gaining traffic often support the quick "scoop" over deeper insight. For example, Reddit -- a potential major firehose of traffic these days -- has its algorithm designed to reward quick, early votes, meaning that longer, thoughtful, insightful pieces almost have no chance, because by the time people have read and thought through them, it's "too late" to have the votes really count.

Some will argue, of course, that this is just a sign of the "bad" side of the internet: valuing quick, dirty and sometimes wrong reporting over longer, more thoughtful work. But I'm not convinced that's true. Again, there are plenty of historical examples of this in pre-internet times as well -- with Dewey Beats Truman being just one of many such examples.

Instead of just mocking those who messed up, or using a bit of confirmation bias to insist that it shows how awful things are in this "real time era," I'd be much more interested to see if we could have a discussion on how to change the incentives. How do we better reward insight and thoughtful commentary over the quick hit-scoop? Is it possible? And, if so, what needs to be done?

Filed Under: first, healthcare, hot news, scoop, scotus, traffic
Companies: cnn, fox news, reddit

Meltwater Response To Associated Press Lawsuit: AP Is Misusing Copyright Law

from the indeed,-they-are dept

We were somewhat surprised by the Associated Press' decision to sue news search engine Meltwater, because we couldn't see how the AP -- even with its absurdist interpretation of copyright law -- had any case. Meltwater works with companies to help them track news about themselves. While it's similar to a clipping service, it doesn't actually "clip" the news. Instead, just like Google News or other news search engines, it provides a headline, a snippet and a link to the full story. In other words, if the AP's argument gains traction, the AP may have effectively outlawed search engines. That's ridiculous. Among the AP's silly claims in the lawsuit (and there are many), is one that says because users can cut and paste AP stories from their original websites and "save" them in a Meltwater archive, Meltwater is guilty of violating copyright law. Under that argument, so is any email program or word processing program.

Either way, Meltwater has hit back with a response (embedded below) that pushes back on all of these points, explains pretty clearly how it doesn't actually infringe... and also claims that the AP's arguments amount to "copyright misuse":

Plaintiff’s claims are barred in whole or in part by the doctrine of copyright misuse. Through this Complaint and through other means, Plaintiff seeks to misuse its limited copyright monopoly to extend its control over the Internet search market more generally, thereby improperly expanding the protections afforded by U.S. copyright law. Among other things, AP has misused its copyright monopoly by demanding that third parties take licenses for search results, which do not require a license under U.S. copyright law, and AP has also formed a consortium (called NewsRight) with the purpose of further misusing its copyright monopoly to extract licensing fees that exceed what the law allows.

Meltwater also brings up multiple other defenses, including a bunch of defenses highlighting how the AP failed to bring its lawsuit in a timely manner. They also point out that since the AP posts these articles freely on the web, there's an implied license that you can link to it and point people to the content.

There is, of course, also the AP's attempt to bring back the bogus "hot news" doctrine, which some companies like the AP have been trying to revive after it was considered a completely dead concept. So far, the courts aren't buying these hot news claims, and hopefully they get rejected here as well. Meltwater attacks the hot news claims head on with two interesting arguments. First, it claims that Section 230 protects it from any hot news claim. That's an interesting argument, though I'm not sure it really applies here. Separately, however, they argue (correctly, in my view) that hot news doesn't exist any more, effectively, because it's really a form of a copyright claim, and all state copyright claims (hot news is a state law issue) are preempted by federal copyright law. It would be nice to have a court officially kill off hot news as a concept, so here's a chance for that to happen.

Honestly, I still can't figure out what the AP thinks its doing here, other than trying to shake money out of a search engine because its execs remain too clueless on how to run the organization in this modern era.

Filed Under: aggregation, hot news, search engine
Companies: associated press, meltwater

One Entertainment Business Publication Sues Another For Copyright Infringement For Having The Same Stories

from the idea-expression,-nikki dept

Nikki Finke, the infamous editor of Deadline.com is apparently suing the Hollywood Reporter for copyright infringement... because it wrote stories on the same news events as Deadline.com. Seriously. Here's Finke's quote:

"PMC (the company that owns Deadline.com) is taking a stand against desperate and copycat news organizations and media outlets such as THR that constantly monitor PMC�s websites for the sole purpose of copying and imitating PMC websites� news stories and original content within minutes after online publication. These copycat media outlets such as THR, rather than conducting their own independent reporting and investigation, developing their own sources and insiders, and generating their own leads and stories, simply steal PMC�s content and pawn it off as their own. In truth, THR, faced with the harsh reality that it had become a second-rate entertainment industry news source unable to attract insiders� attention anymore."

THR, for its part, claims the whole thing is ridiculous, and many of the stories mentioned were on both sites because Hollywood publicists sent the same info to both sites:

"An initial review of the complaint shows that it is replete with examples of stories that originated from widely-released press releases from publicists, or widespread confirmations from publicists to numerous outlets, including both The Hollywood Reporter and Deadline.com. It is not copyright infringement to report these stories, even if on occasion Deadline.com posts them first."

While I don't always agree with THR's coverage, on this one, I'm on their side. Reporting on the same story -- even if you find out about it from the other site -- is not copyright infringement. It's often how news works. Someone should explain to Finke the idea/expression dichotomy in copyright law, as well as the important tidbit of information that you can't own facts, and others are free to write about the same facts.

Filed Under: copyright, hot news, journalism, news
Companies: deadline.com, pmc, the hollywood reporter

Appeals Court Realizes Hot News Makes No Sense; Dumps Injunction On TheFlyOnTheWall

from the hot-news-loss dept

"Hot news" was pretty much dead a few years ago. The court-created doctrine, which resulted in a weird quasi-intellectual property on factual information about a century ago, hadn't been used for years and many people had assumed that it was pretty much gone. However, old legal doctrines die hard and, a few years back, some Wall Street firms sought to revive it, claiming that the website theFlyOnTheWall.com violated their "hot news" rights by accurately reporting on how those Wall Street firms were rating stocks. That's factual information and not protected by copyright, but the firms claimed it undermined their business models via hot news... and the lower court agreed, issuing an injunction.

Thankfully, an appeals court has dumped all of that, claiming that hot news is preempted by federal copyright law and that there's nothing wrong with reporting on factual information. The court mainly relies on the famous NBA v. Motorola case, which found that basketball scores and stats were facts and not protected by copyright or hot news. Using the same rules, the court finds that copyright wipes out any "hot news" in this case as well.

We conclude that applying NBA and copyright preemption principles to the facts of this case, the Firms' claim for "hot news" misappropriation fails because it is preempted by the Copyright Act. First, the Firms' reports culminating with the Recommendations satisfy the "subject matter" requirement because they are all works "of a type covered by section 102," i.e., "original works of authorship fixed in a... tangible medium of expression." 17 U.S.C. § 102. As discussed above, it is not determinative for the Copyright Act preemption analysis that the facts of the Recommendations themselves are not copyrightable. See NBA, 105 F.3d at 850. Second, the reports together with the Recommendations fulfill the "general scope" requirement because the rights "may be abridged by an act which, in and of itself, would infringe one of the exclusive rights' provided by federal copyright law," Altai, Inc., 982 F.2d at 716 (citing Harper & Row, 723 F.2d at 200), i.e., "acts of reproduction, performance, distribution or display," id. (internal quotation marks omitted).

Third and finally, the Firms' claim is not a so-called INS-type non-preempted claim because Fly is not, under NBA's analysis, "free-riding." It is collecting, collating and disseminating factual information -- the facts that Firms and others in the securities business have made recommendations with respect to the value of and the wisdom of purchasing or selling securities -- and attributing the information to its source. The Firms are making the news; Fly, despite the Firms' understandable desire to protect their business model, is breaking it. As the INS Court explained, long before it would have occurred to the Court to cite the First Amendment for the proposition:

[T]he news element -- the information respecting current events contained in the literary production -- is not the creation of the writer, but is a report of matters that ordinarily are publici juris; it is the history of the day. It is not to be supposed that the framers of the Constitution, when they empowered Congress "to promote the progress of science and useful arts, by securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries" (Const., Art I, § 8, par. 8), intended to confer upon one who might happen to be the first to report a historic event the exclusive right for any period to spread the knowledge of it.

The court also distinguishes the classic "hot news" case (INS) by noting that in that case, the competing firm was taking AP news, rewriting it, and pretending it was its own. That's not what's going on here, where ratings are simply being aggregated.

This is an excellent ruling, though I doubt we've seen the end of "hot news" yet. There may still be appeals, and there are a few other such hot news cases out there. But it's nice to see the judges toss this one out.

Filed Under: copyright, facts, first amendment, hot news, reporting
Companies: afp, ap, belo, gannett, mcclatchy, naa, ny times, scripps, theflyonthewall, time, washington post