AP filed bill was to restrain the pirating of complainant’s news by defendant in three ways:
First, INS bribed newspaper employees to give AP's news to INS before publication.
Second, INS induced AP members to violate by-laws and permit INS to get news before publication.
Third, INS employees copied news from bulletin boards and from early edition boards and then published it as their own.
District court granted preliminary injunction on first two issues, but left third to COA.
COA sustained the injunction.
Can INS be lawfully restrained from appropriating news taken from bulletins issued by AP for the purpose of selling it to INS clients?
Court also decided to address:
Is there any property in news?
If there is property in news collected for the purpose of being published, does this property right survive once it is published and communicated?
Does defendant’s admitted course of conduct in appropriating for commercial use matter taken from bulletins or early editions of AP publications constituted unfair competition in trade?
Regarding news matter as the mere material from which these two competing parties are endeavoring to make money, and treating it, therefore, as quasi property for the purposes of their business because they are both selling it as such, defendant’s conduct differs from the ordinary case of unfair competition in trade principally in this that, instead of selling its own goods as those of complainant, it substitutes misappropriation in the place of misrepresentation, and sells complainant’s goods as its own.
There is a literary element to the news, and there is a property right in this element, but there is also a historical, substantial element to the news, which is common property.
Clearly the Framers did not intend the first person the hear of a historical event to be in exclusive control of spreading knowledge of it.
While the substance of news is common property, the business of making it known to the world is subject to rules on unfair competition.
A property interest in news cannot be maintained by keeping it secret.
The value is in distributing it while it is fresh.
Since labor and money are required to distribute the news in a way that makes it valuable and makes it so that people will pay for it, in this way the news should be considered quasi property.
It is quasi property because there is a property right not between the public and the AP or between the public and the INS but rather between the AP and the INS as distributors and business competitors.
It is possible, due to phone/telegraph, for INS to take AP's work when it is published on the east coast and then distribute it concurrently with the AP on the west coast.
INS says that when the news gets posted on bulletin boards, it becomes public property and therefore INS can do whatever it wants with it.
Court says that this is flawed reasoning because it is considering the property rights between the public and the AP, not between the AP and the INS. There is a big difference between these, because AP and INS are competitors in the business of news distribution.
INS is essentially diverting profits from the AP, which earned the profits, to itself, which did not.
The intent of the AP is to "abandon" the news to the public, not to abandon it to the INS.
The knowledge for which protection is sought in the case at bar is not of a kind upon which the law has heretofore conferred the attributes of property; nor is the manner of its acquisition or use nor the purpose to which it is applied, such as has heretofore been recognized as entitling a plaintiff to relief.
To give relief against this right as a property right would require the making of a new rule in analogy to existing ones, and creation or recognition by courts of a new private right may work serious injury to the general public, unless the boundaries of the right are definitely established and wisely guarded.
Courts are ill-equipped to make the investigations which should precede a determination of the limitations which should be set upon any property right in news or of the circumstances under which news gathered by a private agency should be deemed affected with a public interest.
Therefore, even though it seems like a remedy is necessary here, the Court should not create new laws to enforce it.