The hot news doctrine came from the INS case in 1918. INS v Associated Press 248 US 215.

It is an old case which faded into obscurity for a while. It’s contours were ill defined but clarified in the Motorola v NBA years later when it was revived and it’s boundaries more clearly delineated.

The Motorola case was about the publishing of hot news in the form of basketball scores. There was a further case (PGA Golf) more recently over the publication of golf scores. There have been other cases since INS over stock quotes and time sensitive news such as weather reports.

INS and AP were competitors in news. The INS case was about whether the defendant could be restrained from appropriating news taken from bulletins issued by INS for the purpose of reselling it on the basis of the tort of unfair competition in business.

There were time differentials involved as INS was on the West Coast and AP on the East Coast. AP hadn’t obtained copyright in their articles so didn’t rely on copyright and FURTHER as even the complainant acknowledged NEWS IS NOT WITHIN THE OPERATION OF THE COPYRIGHT ACT.

Newspapers were not within the protection of the copyright acts of 1790 and 1802. (Clayton v. Stone, 2 Paine 382) The Judges didn’t proceed on the copyright issue and Brandeis specifically rejected any copyright protection in “news of the day” or facts.

However all Judges except Brandeis were prepared to recognise a limited value in the expenditure in aggregating, publishing and disseminating news whilst it was fresh or “hot news”. (first mover advantage, and lead time).

The actual news was recognised as too evanescent and important to be recognised as property but it was given the status of a kind of quasi property right in relation to time sensitive news until the commercial value of the news dissipated.

In the INS case there was some element of copying by the defendant and failure to credit the source of the articles they obtained. What they did was received the articles through the telephone and by telegraph from employees of AP, and they re-wrote the complainant’s articles. However they added commentary of their own.

Brandeis issued a very inspiring dissenting judgement. I remember it even though it has been six years since I read it. He was very much alive to the dangers of recognising a tort of misappropriation in relation to ‘news of the day’ and ‘facts’. He felt that the tort of unfair competition wasn’t applicable to the facts before him.

Brandeis said “That competition is not unfair in a legal sense merely because the profits gained are unearned, even if made at the expense of a rival, is shown by many cases besides those referred to above. He who follows the pioneer into a new market, or who engages in the manufacture of an article newly introduced by another, seeks profits due largely to the labor and expense of the first adventurer, but the law sanctions, indeed encourages, the pursuit. [Footnote 14] He who makes a city known through his product must submit to sharing the resultant trade with others who, perhaps for that reason, locate there later. 80 U. S. 673. He who has made his name a guaranty of quality protests in vain when another with the same name engages, perhaps for that reason, in the same lines of business, provided precaution is taken to prevent the public from being deceived into the belief that what he is selling was made by his competitor. One bearing a name made famous by another is permitted to enjoy the unearned benefit which necessarily flows from such use, even though the use proves harmful to him who gave the name value”

…..”The rule for which the plaintiff contends would effect an important extension of property rights and a corresponding curtailment of the free use of knowledge and of ideas, and the facts of this case admonish us of the danger involved in recognizing such a property right in news, without imposing upon news-gatherers corresponding obligations. A large majority of the newspapers and perhaps half the newspaper readers of the United States are dependent for their news of general interest upon agencies other than the Associated Press. The channel through which about 400 of these papers received, as the plaintiff alleges, “a large amount of news relating to the European war of the greatest importance and of intense interest to the newspaper reading public” was suddenly closed. The closing to the International News Service of these channels for foreign news (if they were closed) was due not to unwillingness on its part to pay the cost of collecting the news, but to the prohibitions imposed by foreign governments upon its securing news from their respective countries and from using cable or telegraph lines running therefrom. For aught that appears, this prohibition may have been wholly undeserved, and at all events the 400 papers and their readers may be assumed to have been innocent. For aught that appears, the International News Service may have sought then to secure temporarily by arrangement with the Associated Press the latter’s foreign news service”

It is definitely worth a read.

http://supreme.justia.com/us/248/215/case.html