March 12, 2005

iWin: Apple's Blogger Trade Secret Judgment Skirts Question of Bloggers-As-Journalists

Apple Beats the Bloggers on Trade Secret GroundsYesterday a judge in California ordered three online "reporters" to reveal their sources to Apple Computer after the company brought a lawsuit against the bloggers demanding they reveal who leaked information to them about new music software the company planned to introduce that Apple considers a trade secret.

This was particularly disappointing for most onlookers to the case who had wanted to see what it would mean for online reporters and bloggers in the future, especially in a state like California with a so-called "sheild law" that protects journalists from revealing the identities of their confidential sources. An initial ruling about whether bloggers and other part-time, amateur or hobbyist writers are in fact bona fide members of the Fourth Estate would have surely brought about much consternation throughout the rest of the journalistic enterprise... instead, the judge skirted the issue by equating the release of proprietary information to stealing:

    The ruling came in the three-month-old lawsuit brought by Apple against the unnamed individuals, presumably Apple employees, who reportedly leaked information about new music software, code-named Asteroid, which the company said constituted a trade secret. Under California law, divulging trade secrets is subject to civil and criminal penalties.

    That information was published on three Apple enthusiast Web sites, Apple Insider, Think Secret and PowerPage. The Web sites were not named in the suit.

    In the course of discovery, Apple served a subpoena on Nfox.com, the e-mail service provider for PowerPage, seeking information and documents that might identify the source of the disclosure of Apple's new product. The Web sites sought to block that subpoena.

    The case has been closely watched for its potential impact on the publishers of Web sites and bloggers, who say the privilege of reporters to protect their confidential sources should extend to online writers.

    But Judge Kleinberg wrote that assuming Apple's accusations are true, the information is "stolen property, just as any physical item, such as a laptop computer containing the same information on its hard drive (or not) would be."

    He went on to say that "the right to keep and maintain proprietary information as such is a right which the California Legislature and courts have long affirmed and which is essential to the future of technology and innovation."

    As for Jason O'Grady, the publisher of PowerPage, and his claim to a journalist's privilege to protect confidential sources, the ruling said, "whether he fits the definition of a journalist, reporter, blogger or anything else need not be decided at this juncture for this fundamental reason: there is no license conferred on anyone to violate valid criminal laws."

    Judge Kleinberg also said: "Defining what is a 'journalist' has become more complicated as the variety of media has expanded. But even if the movants are journalists, this is not the equivalent of a free pass."

    The Electronic Frontier Foundation, the civil liberties organization that represented the Web sites, called the ruling a blow to "constitutional rights," and said it would appeal. The organization argued that authors of Web sites were protected by California's shield law, which protects journalists who refuse to divulge sources.

    Kurt Opsahl, staff lawyer with the foundation, said the ruling could have serious consequences on the rights of all journalists, not only those who write for Web sites.

    "I had hoped the court would see it was important to protect the confidentiality of sources," he said. "It's very easy for a company to contend that any piece of information is a trade secret."

    The organization has seven days to file an appeal with the California Court of Appeals, after which Apple would have 10 days to respond, Mr. Opsahl said. If the appellate court rules for Apple, he said, Electronic Frontier will try to have the case heard by the California Supreme Court. "Given the constitutional nature of the case, I would hope the California Supreme Court would decide this is important," Mr. Opsahl said.

    Apple declined to comment on the ruling, except to repeat Judge Kleinberg's opinion that the publishing of Apple's confidential information was illegal. "The judge ruled that there is no license conferred on anyone to violate valid criminal laws," said Steve Dowling, a spokesman for Apple.

    But to many technology industry experts, the prospect of Apple fighting the bloggers is peculiar.

    "Apple suing its most enthusiastic fans is like the Grateful Dead suing its concert bootleg tape makers," said Paul Saffo, director of the Institute for the Future in Palo Alto, Calif. Fan recordings have fueled that band's popularity over the years. Mr. Saffo said the rumor mill had only helped Apple in the last 20 years.

Well... okay. Despite the failure to address the issue of bloggers as journalists (or not) it will surely engender great speculation on the future of the issue... one that, in an era where jailing "real" journalists like Judith Miller and Matthew Cooper in the Valerie Plame case (related to violation of the Intelligence Identities Protection Act of 1982) could take place if they don't reveal their sources. I agree with BusinessWeek's recent op-ed on the matter:

    ...the imminent jailing of two journalists from Time magazine and The New York Times for protecting what is widely said to be a Bush Administration source who leaked the name of a CIA agent requires action. Some 31 states have shield laws for journalists. It's now time for a federal shield law as well.

    America grants legal exemptions to its citizens reluctantly, but it does grant them. Lawyer-client, clergy-laity, doctor-patient, and husband-wife relationships are all protected under the law, with limits on what testimony prosecutors can compel. Journalists claim the same treatment for their relationship with sources under the First Amendment, arguing that a greater good for society comes from their freedom to investigate matters in the public interest.

    The Supreme Court has never recognized a First Amendment privilege, but Justice Dept. guidelines do instruct prosecutors not to go after reporters except under extreme circumstances. That's precisely the nature of the state shield laws. The severity of the crime and the availability of other sources determine whether journalists must testify. The privileges under state shield laws are not absolute.

    This reasonable balance test of the public interest should now be extended to the federal level. It may very well be that even under a federal shield law, Time magazine writer Matthew Cooper and Times reporter Judith Miller could be called to testify before a grand jury if someone's life had been placed in jeopardy. But this appears not to be the case. It's not even clear that a crime was committed. The prosecution of Cooper and Miller fails to meet the balance test.

A "Federal Shield Law" that includes the class of bloggers that covered the national political conventions could make the whole question moot.

- Arik

Posted by Arik Johnson at March 12, 2005 08:12 PM