The British company Ransquawk can't distribute Dow Jones' “hot news” before the pieces appear on the Web sites Wsj .com, Barrons.com, or MarketWatch.com, a federal judge has ruled.
U.S.
District Court Judge Jesse Furman in New York issued an injunction that bans Ransquawk from distributing Dow Jones “headlines, ledes, partial articles, or full articles” -- or summaries of
that material -- before Dow Jones itself publishes the stories on its online news properties.
The injunction marks a victory for Dow Jones, which sued Ransquawk this January for allegedly
misappropriating Dow Jones' articles. Ransquawk distributed summaries of Dow Jones “hot news” to 15,000-30,000 online subscribers, according to Dow Jones.
The news service alleged
that Ransquawk published items from “DJ Dominant” -- Dow Jones' self-described “time-advantaged” service. “By design, it contains Dow Jones's hottest, most time-sensitive
news before Dow Jones publishes that news anywhere else,” the company said in its legal papers.
The company alleged that Ransquawk “systematically copies and retransmits verbatim,
or nearly verbatim, content from the DJ Dominant newsfeed that was reported, written, and edited by journalists working for Dow Jones.” On one occasion, Ransquawk allegedly sent users a
“breaking news headline” about Twitter's initial public offering -- only two seconds after the item ran on one of Dow Jones' channels.
Dow Jones argued in its legal papers that
Ransquawk's “free-riding” undermines the “economic incentive to invest in the costly process of reporting time-sensitive news.”
But even though Dow Jones obtained an
injunction, the company might have problems enforcing it, given that Ransquawk isn't based in the U.S.
Ransquawk didn't appear in court to defend itself, so it's not hugely surprising that Dow
Jones won its lawsuit. But other “hot news” battles -- especially contested ones -- won't necessarily turn out the same way.
That's because the concept of “hot news” --
which might have made sense 100 years ago -- is questionable in today's media environment.
The principle originated in the early 1900s, when The Associated Press successfully sued a competing
wire service for rewriting AP stories. But that case obviously predates the modern media environment, where people can use Twitter, Facebook and other platforms to instantaneously redistribute news
organizations' “exclusives.
One recent high-profile battle centered on “hot news” resulted in a 2011 appellate court decision in favor of a Web site that allegedly
misappropriated news. That matter involved a lawsuit by a coalition of banks against the Web site Flyonthewall.com, which allegedly sent out early morning summaries of reports by Barclays, Bank of
America's Merrill Lynch and Morgan Summary. A trial judge issued an injunction banning the site from distributing the summaries, but the 2nd Circuit Court of Appeals lifted the order.
That
battle drew friend-of-the-court briefs from a host of Web companies, including Twitter and Google.
There have been a handful of other recent hot news cases, but they all appear to have
settled. In one, the company All Headline News agreed to pay damages to The Associated Press
for allegedly misappropriating hot news. In another, the site Briefing.com admitted liability for sending out Dow Jones' headlines.