Opinion ID: 219099
Heading Depth: 6
Heading Rank: 3

Heading: Narrowness of the Preemption Exception

Text: The NBA panel repeatedly emphasized the narrowness of the hot news tort exception from preemption. See id. at 843, 848, 851, 852 (using the word narrow or narrowness five times). Although our discussion of preemption in NBA did not focus on the importance of maintaining the uniform nationwide scheme that the Copyright Act, with its 1976 preemption amendment, 17 U.S.C. § 301, provides, we later underscored it. In Krause v. Titleserv, Inc., 402 F.3d 119, 123 (2d Cir.2005), we declined to limit protection for copyrights held by owners of computer programs to those with formal title to such programs. The first reason we gave was that title may depend on state law that differs from one state to another. The result would be to undermine some of the uniformity achieved by the Copyright Act.... If [the relevant section of the Copyright Act] required formal title, two software users, engaged in substantively identical transactions might find that one is liable for copyright infringement while the other is protected by [the section], depending solely on the state in which the conduct occurred. Such a result would contradict the Copyright Act's express objective of creating national, uniform copyright law by broadly preempting state statutory and common-law copyright regulation.  Community for Creative Non-Violence v. Reid, 490 U.S. 730, 740, 109 S.Ct. 2166, 104 L.Ed.2d 811 (1989); see also 17 U.S.C. § 301(a). Id. at 123 (emphasis added). Indeed, central to the principle of preemption generally is the value of providing for legal uniformity where Congress has acted nationally. See, e.g., Paneccasio v. Unisource Worldwide, Inc., 532 F.3d 101, 113 (2d Cir.2008) (The purpose of ERISA preemption is to ensure that all covered benefit plans will be governed by unified federal law, thus simplifying life for employers administering plans in several states, because a patchwork scheme of regulation would introduce considerable inefficiencies in benefit program operation. (internal quotation marks and brackets omitted)). This is a pressing concern when considering the narrow hot news misappropriation exemption from preemption. The broader the exemption, the greater the likelihood that protection of works within the general scope of the copyright and of the type of works protected by the Act will receive disparate treatment depending on where the alleged tort occurs and which state's law is found to be applicable. The problem may be illustrated by reference to a recent case in the Southern District of New York. In Associated Press v. All Headline News Corp., 608 F.Supp.2d 454 (S.D.N.Y.2009), the court sought to determine whether there was a difference between New York and Florida hot news misappropriation law in order for it to analyze, under choice-of-law principles, which state's law applied. Judge Castel observed that [n]o authority has been cited to show that Florida recognizes a cause of action for hot news misappropriation. Then again, defendants have not persuasively demonstrated that Florida would not recognize such a claim. [30] Id. at 459-60. It appears, then, that the alleged hot news misappropriation in All Headline News Corp. might have been permissible in New York but not in Florida. The same could have been said for the aggregation and publication of basketball statistics in NBA, and the same may be said as to the aggregation and publication of Recommendations in the case at bar. To the extent that hot news misappropriation causes of action are not preempted, the aggregators' actions may have different legal significance from state to state  permitted, at least to some extent, in some; prohibited, at least to some extent, in others. It is this sort of patchwork protection that the drafters of the Copyright Act preemption provisions sought to minimize, and that counsels in favor of locating only a narrow exception to Copyright Act preemption.