FlyOnTheWall Buzzing Again After Injunction Is Lifted
A federal appellate court has stayed a controversial order limiting a financial site's ability to publish banks' stock recommendations.
The order, which lifts an injunction issued in March by U.S. District Court Judge Denise Cote in New York, means TheFlyOnTheWall. com can now resume sending out early morning summaries of reports by Barclays, Bank of America's Merrill Lynch and Morgan Summary. The site's lawyer, Glenn Ostrager, says his client will "continue to provide its newsfeed to the public without the restraints imposed by the district court."
The appellate judges didn't explain why they stayed the injunction, but observers say the move could signal that the court believes Cote's order is problematic. "It's a pretty significant development," says Sam Bayard of the Citizen Media Law Project. "It seems at least possible that they're curious about the case and are worried about the injunction."
The Citizen Media Law Project is considering whether to weigh in on the appeal with a friend-of-the-court brief. The digital rights group Public Citizen also says it will file a friend-of-the-court brief. (Public Citizen represents MediaPost in an unrelated case.)
Cote originally ruled that the site violated the so-called "hot news" doctrine by posting summaries of the banks' time-sensitive research and recommendations before their clients had received them. She enjoined the site from publishing such research until at least 10 a.m.
Fly had argued that it obtained the reports from a variety of sources, including other news organizations. Cote said in her ruling that all of those publications might be misappropriating hot news and gave the banks up to one year to take action against those companies.
But media experts saw potential First Amendment problems in an order that prevented one site from posting the same material that other news companies were publishing. "It's regulation of speech to say, 'You must delay your publication of this news that's in the public domain, that's been publicly reported by others,'" Bayard said at the time.
Fly said in court papers that some customers canceled their subscriptions as a result of Cote's order.