Vol 7 No 1 - Roger Williams University School of Law
Vol 7 No 1 - Roger Williams University School of Law Vol 7 No 1 - Roger Williams University School of Law
wish to encourage private lawsuits, and believe that marketincumbents, particularly sole-source providers, will think twicebefore complaining about data piracy to one of the country’s twofederal antitrust enforcement agencies.Although Title I would be enforceable only through the FTCproceedings, the theory of liability is akin to the common law tortof misappropriation of “hot news.”179 Value-added andtransformative uses are permitted, as H.R. 1858 considers a copyto be an infringement only if it is “substantially the same” as theoriginal,180 and prohibits the public sale or distribution of aduplicate database only where it is distributed in competition withthe original database.181Title II of H.R. 1858 would create a separate prohibitionagainst the “misappropriation” of real-time market information.Section 201 states that any person who “obtains directly orindirectly from a market information processor real-time marketinformation,” and “directly or indirectly sells, distributes,redistributes, or otherwise disseminates such information withoutthe authorization of such market information processor, shall beliable to that market information processor . . . .”182 In contrast toTitle I, the prohibition of Title II is not limited to the wholesaleduplications of real-time market information, nor to the sale ordistribution of the information in competition with theinformation processor. Moreover, this prohibition would beprivately enforceable through a civil action for monetary andinjunctive relief.183While the protection that H.R. 1858 would provide couldhardly be called comparable to that specified in H.R. 354 ormandated by the EU Database Directive, this is not to suggestthat enactment of H.R. 1858, rather than H.R. 354, would leaveU.S. database producers wholly unprotected in Europe. To themisappropriation suits involving databases will generally be preempted under section105(b) of the proposed act. Id. at 10 n.68. However, section 105(b) merely states that“no State law that prohibits or that otherwise regulates conduct that is subject to theprohibitions specified in section 102 shall be effective to the extent that such State lawis inconsistent with section 102.” H.R. 1858 § 105(b), 106th Cong. (1999) (emphasisadded).179. See supra notes 34-45 and accompanying text.180. H.R. 1858 §§ 101(2), 102.181. Id. § 102.182. Id. § 201 (proposing to amend § 11A of the Securities Exchange Act of 1904).183. Id.
contrary, U.S. database producers would arguably be entitled toprecisely the same protection in Europe that they would be (and infact currently are) entitled to in the United States. This is sobecause Article 10bis of the Paris Convention states that membercountries of the Paris Union are bound to assure nationals of suchcountries effective protection against unfair competition, and goeson to state that any act of competition contrary to honest practicesin industrial or commercial matters constitutes an act of unfaircompetition.184 Given that the EU has now mandated sui generisprotection for database contents even against non-competitiveextractions and re-utilizations, European countries can hardlyargue that wholesale duplication of database contents in order tocompete with the database producer is not an act of unfaircompetition within the meaning of Article 10bis of the ParisConvention.Thus, the argument that enactment of sui generis protectionof the sort spelled out in H.R. 354 is necessary (or sufficient) forU.S. database producers to obtain protection for their databases inthe EU is suspect. As we have also seen, it is not clear thatpassage of H.R. 354 will be deemed sufficiently comparable toqualify U.S. database producers for the (arguably over-broad) suigeneris protection now available in Europe. Indeed, one featurethat H.R. 354 and H.R. 1858 have in common distinguishes bothbills from the type of protection mandated by the EU Directive,and further undermines the argument that either bill wouldprovide comparable protection. This feature concerns theenforceability of contracts that put additional restrictions on theuse of database contents.3. Contractual CircumventionWhile the two U.S. bills provide two different approaches tothe protection of database contents, both bills make it clear thatnothing in the legislation would preempt contracts that placeadditional restrictions on the use of a database. H.R. 354 isparticularly adamant in this regard. Section 1405(a) of H.R. 354states that nothing in this bill “shall affect rights . . . orobligations relating to information, including . . . the law of184. Paris Convention for the Protection of Industrial Property, Mar. 20, 1883, 13U.S.T. 2, 828 U.N.T.S. 107, as last revised at the Stockholm Revision Conference, July14, 1967, 21 U.S.T. 1538, 828 U.N.T.S. 303, art. 10bis.
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wish to encourage private lawsuits, and believe that marketincumbents, particularly sole-source providers, will think twicebefore complaining about data piracy to one <strong>of</strong> the country’s tw<strong>of</strong>ederal antitrust enforcement agencies.Although Title I would be enforceable only through the FTCproceedings, the theory <strong>of</strong> liability is akin to the common law tort<strong>of</strong> misappropriation <strong>of</strong> “hot news.”179 Value-added andtransformative uses are permitted, as H.R. 1858 considers a copyto be an infringement only if it is “substantially the same” as theoriginal,180 and prohibits the public sale or distribution <strong>of</strong> aduplicate database only where it is distributed in competition withthe original database.181Title II <strong>of</strong> H.R. 1858 would create a separate prohibitionagainst the “misappropriation” <strong>of</strong> real-time market information.Section 201 states that any person who “obtains directly orindirectly from a market information processor real-time marketinformation,” and “directly or indirectly sells, distributes,redistributes, or otherwise disseminates such information withoutthe authorization <strong>of</strong> such market information processor, shall beliable to that market information processor . . . .”182 In contrast toTitle I, the prohibition <strong>of</strong> Title II is not limited to the wholesaleduplications <strong>of</strong> real-time market information, nor to the sale ordistribution <strong>of</strong> the information in competition with theinformation processor. Moreover, this prohibition would beprivately enforceable through a civil action for monetary andinjunctive relief.183While the protection that H.R. 1858 would provide couldhardly be called comparable to that specified in H.R. 354 ormandated by the EU Database Directive, this is not to suggestthat enactment <strong>of</strong> H.R. 1858, rather than H.R. 354, would leaveU.S. database producers wholly unprotected in Europe. To themisappropriation suits involving databases will generally be preempted under section105(b) <strong>of</strong> the proposed act. Id. at 10 n.68. However, section 105(b) merely states that“no State law that prohibits or that otherwise regulates conduct that is subject to theprohibitions specified in section 102 shall be effective to the extent that such State lawis inconsistent with section 102.” H.R. 1858 § 105(b), 106th Cong. (1999) (emphasisadded).179. See supra notes 34-45 and accompanying text.180. H.R. 1858 §§ 101(2), 102.181. Id. § 102.182. Id. § 201 (proposing to amend § 11A <strong>of</strong> the Securities Exchange Act <strong>of</strong> 1904).183. Id.
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