3.3 - Misappropriation

Misappropriation. The categorization of IP-rights in intellectual achievements, productions and distinctive signs is also helpful if one has to consider whether there is room outside the realm of internationally codified IP-rights to grant a similar type of protection to subject matter that does not benefit from any of these IP-rights as provided for in international treaties or EU regulations or directives.

INS v AP, 1918. This issue is also referred to as the misappropriation doctrine, which developed under U.S. law after the judgement of the U.S. Supreme Court in International News Service v Associated Press of 1918 (IPPT19181223). During the first World War International News Service (INS) – a company owned by Hearst, a publisher who also had political aspirations – was banned by the allied countries from securing news from their countries. INS then gathered news from bulletins issued by Associated Press or any of its members, or from newspapers published by them. The question before the U.S. Supreme Court was whether INS could be lawfully restrained. The Supreme Court found that as a competitor INS misappropriated the news – a result of AP’s labour, skill and money. Justice Pitney argued in the opinion of the Court: “The right of the purchaser of a single newspaper to spread knowledge of its contents gratuitously, for any legitimate purpose not unreasonably interfering with complainant's right to make merchandise of it, may be admitted; but to transmit that news for commercial use, in competition with complainant-which is what defendant has done and seeks to justify-is a very different matter. In doing this defendant, by its very act, admits that it is taking material that has been acquired by complainant as the result of organization and the expenditure of labor, skill, and money, and which is salable by complainant for money, and that defendant in appropriating it and selling it as its own is endeavoring to reap where it has not sown, and by disposing of it to newspapers that are competitors of complainant's members is appropriating to itself the harvest of those who have sown.” The misappropriation doctrine was a matter of federal common law but since 1938 it has continued under state law. The case is also well known because of the often quoted phrase from the dissenting opinion of Justice Brandeis: “The general rule of law is, that the noblest of human productions – knowledge, truths ascertained, conceptions, and ideas – became, after voluntary communication to others, free as the air to common use.”

3.3.1. European Union law

Room for national law. In its Premier League judgement of 4 October 2011 the Court of Justice (IPPT20111004) indicates that there is room for misappropriation protection as matter of national law of the member states.

Premier League. The Court found in its judgement (IPPT20111004) (under 99) that, as a matter European Union law, sporting events  cannot be protected under copyright and that it is undisputed that European Union law does not protect them on any other basis in the field of intellectual property. The court then held (under 100) that “nonetheless, sporting events, as such, have a unique and, to that extent, original character which can transform them into subject-matter that is worthy of protection comparable to the protection of works and that protection can be granted, where appropriate, by the various domestic legal orders.” Because the promotion of European sporting issues is also a matter that the European union is to contribute to (article 165(1) TFEU) (under 101), the Court found (under 102) that “it is permissible for a Member State to protect sporting events, where appropriate by virtue of protection of intellectual property, by putting in place specific national legislation, or by recognizing, in compliance with European Union law, protection conferred upon those events by agreements concluded between the persons having the right to make the audiovisual content of the events available to the public and the persons who wish to broadcast that content to the public of their choice.”

3.2.2. IP system

IP as exception. Given that there is room for misappropriation protection or common law intellectual property rights under national law, the question arises in which areas such protection may be possible or appropriate. In this context one has to bear in mind that, as discussed above (under 1.6) IP-rights are an exception to the fundamental freedoms that provide the foundation of our legal system: (i) freedom to compete, (ii) freedom of technology and (iii) freedom  of information. In addition, IP-rights are a means to an end. Their purpose is to stimulate innovation and thus to enhance the public domain. It is against this background that restraint is appropriate when one is contemplating to grant similar protection under national common law.

Preemption for intellectual achievements. It is because of these principles that it seems that one has to assume that, outside the realm of patent law and copyright, there is no room for misappropriation protection for intellectual achievements as such.

Misappropriation regarding economic achievements. With regard to economic achievements, this preemptive effect is much less severe. Productions. From an economic or legal perspective it does not seem that there is a fundamental difference between a performing artist – a person who performs a copyrightable work (article 3(a) Rome Convention) – and an athlete who usually does not perform a copyrightable work. In addition, the difference between a producer of a phonogram and the organizer of a sporting event, like the Olympics, seems arbitrary. This seems different with regard to plant variety rights in that a preemptive effect towards the protection of animal varieties seems historically implied therein.

Distinctive signs. A similarly arbitrary difference seems to exist if it comes to the protection of a trade mark or a trade name and the protection of distinctive features of public figures, such as their names or portraits, or  organizations that do not conduct a commercial enterprise, such as a political or Non-Governmental Organization (“NGO”) business. Generally speaking, the preemptive effect of trade mark and trade name law seems limited if it comes to protecting subject matter that falls outside the realm of these statutory IP regimes.