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Swatch Group and Bloomberg have been fighting for three years in New York federal courts regarding the publication of a conference call between Swatch and financial analysts. Closely watched by news outlets, a line has now been drawn in the sand by the Second Circuit.
The Conference Call and Publication
On February 8, 2011, Swatch publicized its 2010 earnings report, and as customary, later that day had a conference call with Swatch executives and 132 financial analysts. Though Bloomberg was not invited, and did not attend, shortly after the call, Bloomberg received an audio copy and transcript of the call. The call did not contain any information that was not already revealed in the published earnings report. That day, Bloomberg made the transcript and recording available on its online financial research service website Bloomberg Professional.
Two days later, Swatch learned of the publication and sent Bloomberg a cease-and-desist later, followed by filing a claim for copyright infringement in federal court on February 14, 2011. On March 2, 2011, Swatch filed a copyright application for the sound recording, and the copyright was registered on April 27, 2011.
This case never made it to trial, though the district court issued two separate opinions and orders. Bloomberg made a motion for summary judgment for failure to state a claim, which the court denied. After court conferences, oral arguments, and more briefing, almost one year later to date, the court sua sponte granted summary judgment to Bloomberg finding Bloomberg's use fair use.
On appeal, the main issue before the court was whether Bloomberg's use was actually fair use.
Bloomberg's Fair Use
The Second Circuit applied the four-factor fair use test, and found that three factors weighed in favor of fair use, while one factor was neutral, and held that Bloomberg's publication of the audio recording was fair use.
U.S. news media have scored a victory in this latest fair use decision. Though each case will have different factors that will affect the balance of factors, courts will continue to give the interests served for the "public purpose" much weight.