Meltwater is a Norwegian clipping service that monitors news about its clients on the Web. These paying clients include companies and governments that fork out good money to outsource trolling the internet for news items themselves. Meltwater provides them with news alerts, newsletters and access to a searchable database.
Those newsletters include introductory sections of news stories (aka “ledes”) that were taken from the Associated Press (AP) and other sources. AP promptly demanded that Meltwater buy a license to distribute news story excerpts. Meltwater refused, pointing out that lifting those ledes from the internet is covered by the fair use rules. AP then sued Meltwater for copyright infringement.
In court, Meltwater argued its activities are identical to those of search engines such as Google (which is showing headlines and text snippets in search results and is covered by the fair use rules. Meltwater would therefore be allowed to clip and display news stories that were found on internet.
U.S. District Judge Denise Cote disagreed and ruled that there are limits to the amount of content an internet scraping service such as Meltwater can lift from internet without payment stating: “Instead of driving subscribers to third-party websites, Meltwater News acts as a substitute for news sites operated or licensed by AP.”
This ruling is also based on the “click-through” rate of the news stories Meltwater dissipated. According the judge, Meltwater had lifted more than was necessary for a search engine and that is therefore harmed AP stating: “Paraphrasing James Madison, the world is indebted to the press for triumphs which have been gained by reason and humanity over error and oppression [...] Permitting Meltwater to take the fruit of AP’s labor for its own profit, without compensating AP, injures AP’s ability to perform this essential function of democracy.”
Reactions to the ruling were mixed. According to Techdirt’sMike Masnick, the judge misinterpreted the “fair use” rules, while AP and the New York Times were happy.
Needless to say, Meltwater appealed, so stay tuned!