Barclays Capital, Inc. et al., v. TheFlyOnTheWall.com, Inc.

Second Circuit Opinion

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EFF, the Citizen Media Law Project (CMLP), and Public Citizen have urged the U.S. Court of Appeals for the Second Circuit to consider the critical First Amendment questions at issue in a case asserting "hot news misappropriation" -- a doctrine that a federal court used to put time limit restrictions on the reporting of facts.

The defendant in the case, TheFlyOnTheWall.com, had gathered stock recommendations from investment banking firms like Merrill Lynch, Morgan Stanley, and Lehman Brothers and reported them on its website. The firms sued TheFlyOnTheWall.com, claiming that the information was "hot news" and the website was free-riding on the firms' work in creating the recommendations. A federal court agreed with the investment banks and ordered TheFlyOnTheWall.com to delay reporting of the information for two hours after the reports are released.

Applying heightened First Amendment scrutiny is especially important now, as the Internet is increasingly allowing Americans to publicly gather, share, and comment on the news of the day. Misuse of the "hot news" doctrine could stifle this extraordinary growth of free expression.

Please see full Opinion below for more information.

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Published In: Constitutional Law Updates, Intellectual Property Updates, Securities Updates

Reference Info:Decision | Federal, 2nd Circuit | United States