742 F.3d 17
2d Cir.2014Background
- Swatch Group (via subsidiary Swatch) held a post‑earnings analysts’ conference call, recorded by an audio vendor; attendees were invited analysts (no press). The vendor announced the call "must not be recorded for publication or broadcast."
- Bloomberg obtained an audio recording and transcript of the call without Swatch’s authorization and made both available unchanged to subscribers of its paid Bloomberg Professional service within minutes of the call.
- Swatch sued for copyright infringement in the sound recording; it registered a narrowed copyright covering Swatch executives’ statements. District court ultimately granted summary judgment to Bloomberg on fair use grounds; Swatch appealed.
- Swatch argued the district court prematurely granted summary judgment and that discovery was needed on Bloomberg’s purpose, state of mind, and subscriber listening habits; Swatch also contested the court’s finding that the work had been "published."
- Bloomberg cross‑appealed seeking a ruling that the recording was not copyrightable; the Second Circuit dismissed the cross‑appeal for lack of appellate standing and jurisdiction because the appealed judgment favored Bloomberg and the later dismissal of Bloomberg’s counterclaim was not timely appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Bloomberg’s copying/dissemination is fair use (overall) | Swatch: district court prematurely decided fair use without discovery; use was commercial, non‑transformative, and harmed Swatch’s rights | Bloomberg: disseminating the unaltered recording to inform investors/analysts is news/public‑interest use; limited harm to Swatch | Court: Fair use — balanced §107 factors favor defendant under these facts. |
| Role of publication status in fair use (was the call "published") | Swatch: statutory definition (§101) controls; recording was unpublished, weighing against fair use | Bloomberg: even if statutorily unpublished, Swatch publicly disseminated its executives’ statements to >100 analysts, so the publication consideration favors fair use | Court: Although statutorily unpublished, prior broad dissemination (de facto publication) + thin copyright supports fair use. |
| Need for discovery / propriety of sua sponte summary judgment | Swatch: discovery needed on Bloomberg’s purpose, intent, and subscriber behavior; Rule 56 procedural safeguards required | Bloomberg: record sufficient; further discovery would not change outcome | Court: No genuine issue of material fact that would alter result; sua sponte summary judgment was appropriate after giving notice. |
| Appellate standing and jurisdiction for Bloomberg’s cross‑appeal | Bloomberg: seeks ruling on copyrightability; asserts aggrievement despite judgment in its favor | Swatch: Bloomberg is not aggrieved by a judgment entered for it; later dismissal of counterclaim was not designated in notice of appeal | Court: Dismissed Bloomberg’s cross‑appeal for lack of standing and lack of jurisdiction (no timely notice re: later order). |
Key Cases Cited
- Campbell v. Acuff‑Rose Music, Inc., 510 U.S. 569 (1994) (articulates transformativeness and §107 factor framework)
- Harper & Row Publishers, Inc. v. Nation Enters., 471 U.S. 539 (1985) (news reporting does not automatically permit copying of unpublished or unpublished‑type works; market harm is critical)
- Bill Graham Archives v. Dorling Kindersley Ltd., 448 F.3d 605 (2d Cir. 2006) (discusses copying entire works and transformative purpose in historical/reference contexts)
- Nihon Keizai Shimbun, Inc. v. Comline Business Data, Inc., 166 F.3d 65 (2d Cir. 1999) (rejected fair use where defendant repackaged and sold factual content without transformation)
- Wainwright Sec., Inc. v. Wall St. Transcript Corp., 558 F.2d 91 (2d Cir. 1977) (similar limitation on re‑dissemination of financial information by competitors)
- Financial Information, Inc. v. Moody’s Investors Service, Inc., 751 F.2d 501 (2d Cir. 1984) (refused fair use where defendant appropriated competitor’s compiled financial data)
- Blanch v. Koons, 467 F.3d 244 (2d Cir. 2006) (fair use is a context‑sensitive inquiry; methodological guidance on factor analysis)
- Barclays Capital Inc. v. Theflyonthewall.com, Inc., 650 F.3d 876 (2d Cir. 2011) (a firm’s ability to make market‑moving disclosures does not give it the right to control who republishes the information)