November 7, 2016

Undersecretary Nelotsky is Alive and Well!

By Bryan K. Wheelock, Principal

In the landmark misappropriation case International News Service v. Associated Press, 248 U.S. 215 (1918),  the Supreme Court identified a quasi-property right created by the investment of effort and money in an intangible thing, such as “hot new.”  The case arose from INS’s copying and redistribution of news stories gathered by AP, which was allegedly discovered when INS ran a false planted story about a Russian Foreign Undersecretary Nelotsky (“STOLEN” spelled backwards, with a “KY” added for Russiany goodness).

The misappropriation doctrine, or “INS doctrine” as it is sometimes called, has been criticized over the years, although it has not yet been entirely discredited.  This is probably due to a general sense of unfairness felt when someone is caught “reaping where they have not sown.”

World Chess US, Inc. dusted off the misappropriation doctrine when it sued Chessgames Services, LLC, in the Southern District of New York (Civil Action 1:16-cv-08629-VM) for its real time republication of moves in chess games reported by World Chess and its authorized licensees.  The websites of World Chess and its licensees prohibits any such viewers from publishing updates of the games for the duration of each game.

The continued validity of the misappropriation doctrine is an interesting question, as is the validity of terms of use that attempt to impose an embargo on information during the game.  If someone gets information from World Chess’s site and starts a discussion that results in postings on Chessgames Services’ site, is Chessgames Services to blame?  Can you make someone keep information secret that is not really secret?

This will be an interesting case to watch.  Your move Chessgames Services!