Are Stock Newsletter Recommendations Protected Expression?

What is the name of your state? Florida, where voting is not just a privilege, it's a competition sport.


I subscribe to several investment newsletters that issue predictions of future economic conditions and stocks to buy to capitalize on those conditions.

Having training in economics and investing myself, as well as experience in investing, I evaluate the author's predictions and recommendations and form my own conclusions as to whether or not his analysis is sound. Then, I invest accordingly.

Frequently I synthesize bits of the author's analysis with my own, or with that which I read from other newsletters, or elsewhere.

I have decided to begin offering my advice to other investors in the form of a periodic newsletter I will sell. The following two general expository formats will comprise most of the newsletter:

(1) Many of my recommendations will be drawn from the newsletters I read, and I may cite them as the source of the recommendation from time to time. I may also offer a rephrased version of the author's analysis with my own commentary on it's validity, the original author's track record, and my estimation of his abilities.

(2) At other times I will not mention the author or the newsletter(s) from which I draw my source material, instead synthesizing a rephrased summary of the original author's reasoning for the stock selections.

Will I be violating the original author's copyright by publishing and selling my newsletter for profit? I have seen other newsletters which devote themselves to openly summarizing the stocks that other newsletters recommend - is it likely that they have obtained permission from the original authors or is this permissable under the copyright law?

Many of my recommendations will be drawn from the newsletters I read, and I may cite them as the source of the recommendation from time to time.

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A: Perfectly fine.

I may also offer a rephrased version of the author's analysis with my own commentary on it's validity, the original author's track record, and my estimation of his abilities.

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A: Perfectly NOT fine.

At other times I will not mention the author or the newsletter(s) from which I draw my source material, instead synthesizing a rephrased summary of the original author's reasoning for the stock selections.

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A: Perfectly NOT fine.

If you're going to do this then do so with option one above. Unless in the other two options you not only attributes the author of the 'paraphrased' piece and give a link where the true and accurate articles/newsletters can be found, but also clearly state that your representation is not a verbatim copy of this author's opinion, you will be diving headfirst into the shallow end of litigation.

I have seen other newsletters which devote themselves to openly summarizing the stocks that other newsletters recommend - is it likely that they have obtained permission from the original authors or is this permissable under the copyright law?

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Clear attribution of another's work falls under 'fair use'. Your scenarios above (except as noted) do not.

I both agree and disagree with BelizeBreeze.

Frequently I synthesize bits of the author's analysis with my own, or with that which I read from other newsletters, or elsewhere.

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The problem here is that the author's analysis IS protected under copyright. You may be aware of court cases with DATA, such as sports scores and the like, where it was found to be non-infringing when someone got, say sports scores from a newsletter or Internet site, and then republished the,. This is different, however -- when you have someone's interpretation of data, then that becomes protectable material.

So, it's okay to take actual DATA from a newsletter, and then come up with your own opinions, but it is probably not okay to use other's analysis to develop your own analysis -- unless you have permission to do so.

Obviously, if all you are taking is bits and pieces from numerous sources to form your own analysis, its unlikely that any laws are broken. If you are looking at the raw data, articles on CNET, Yahoo Groups, Fortune, Business Week, or whatever, and then coming up with your own analysis, thats okay. However, if you read only one newsletter (or a very limited number of newsletters) such that you own analysis is essentially merely a digest of others work, that is where you cross the line into infringement.

(1) Many of my recommendations will be drawn from the newsletters I read, and I may cite them as the source of the recommendation from time to time. I may also offer a rephrased version of the author's analysis with my own commentary on it's validity, the original author's track record, and my estimation of his abilities.

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Merely citing to them will not protect you from copyright infringement, if you are indeed infringing on their copyrights. It may protect you against misappropriation, as BB suggested, but cites or disclaimers are never sufficient to protect you from copyright infringement.

A "rephrased version of the author's analysis" will almost certain run afoul of copyright. Your own opinion of the validity of an analysis or the author's track record or his abilities are actually much more likely to be acceptable under copyright law -- you can certain give your opinions, but you would likely not be able to take big chunks of his writing and publish them along with your commentary.

(2) At other times I will not mention the author or the newsletter(s) from which I draw my source material, instead synthesizing a rephrased summary of the original author's reasoning for the stock selections.

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See above. As BB noted, this would not only be infringement, but perhaps misappropriation (which is actually a trademark violation under the Lanham Act).

Will I be violating the original author's copyright by publishing and selling my newsletter for profit?

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As always, it depends exactly on what you decide to use. Anytime you use copyrighted work without permission, you had the potential for infringement. BB noted that for some works you have a "fair use" defense, and that is true -- but note that while "fair use" does permit the lawful use of quite a bit of infringing material, if you are using the potentially infringing material for commercial use -- that is, for profit -- you have a LOT less protection than if you were using the materials for a not-for-profit use.

I have seen other newsletters which devote themselves to openly summarizing the stocks that other newsletters recommend - is it likely that they have obtained permission from the original authors or is this permissible under the copyright law?

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Obviously, if you are providing your OWN opinions about stocks, based on your OWN research and analysis, that's okay, even if some other newsletters have the same stocks analyzed.. The problem is, say, if a newsletter has a list of "hot stock for this week" or something, then has a list of stocks that they select, then the actual listing IS protectable, as is presumably required some thought and creativity to come up with -- so if you simply used their list, then that would be infringing. If the lists are random, or otherwise non-creative groupings (like all biotech stocks or something), then there would be no protection for the list, and you could use it.

Again, like everything here, the answer to all of your questions is "it depends."

The tough thing here is figuring out what is protected intellectual property and what isn't. Raw data is never protectable, period. Analysis of data is. In general, a list of things is not protectable -- but if some "creativity" or "analysis" went into determine what goes on the list, then it would be protectable. How much "creativity" or "analysis" is necessary to make something protectable, or just how "raw" the data has to be, are fact-specific questions without any bright-line rules.

I thought I read in a Nolo publication that ideas, per se, were not protectable under copyright - only the *original* expression of those ideas could be protected. Especially when dealing with data in the public sphere, and in a context in which the ideas are essentialy statements of established facts and their obvious consequences (e.g. XXX Porno Publications is going to get a big boost in earning next quarter because they have gotten a contract to be the exclusive supplier of gentlemen's magazines to the troops in Iraq), I would think that it would be difficult to determine original expression of an idea.

Now, if a newsletter had some formula they dreamed up to rank stocks, I can easily see how citing the ranking and the criteria comprising it in the particular unique way that it's creator did would be infringement. Similarly if I just stole somebody else's list and reprinted it, that too seems obviously infringement.

But if I go over the list and evaluate it, choosing some of the stocks for further analysis, and then ultimately decide to recommend one or two out of a list of eight or ten, then haven't I worked with data that is freely available to all and with ideas that would be apparent to anyone who saw the data ?(big sales coming up for XXX Porno means big earnings for XXX Porno, thus they will be able to pay off the 20,000,000 note they have outstanding, and hence reestablish their credit which should ultimately not only add to sales but insure more timely deliveries from their suppliers)

There must be some level of public discourse about a businesses and business conditions which can't be protected, otherwise one would not be able to read the same bit of analysis played over and over again in different business magazines, albeit each time to a different tempo and with different phrasing. Where would I have to go to find out where the line is? Case Law?

I thought I read in a Nolo publication that ideas, per se, were not protectable under copyright - only the *original* expression of those ideas could be protected.

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That's right, and not quite ritgh at the same time. Ideas themselves are not protected, as you correctly note. But "original expression" is more than just a fancy way to put the info in a newsletter. "Analyzing Cisco over the next quarter" is an idea, and unprotectable; howver, a specific analysis of Cisco over the next quarter would be protectable -- it is an "original expression" of a more general idea.

So, analysis can easily be protected -- it doesn't have to be as mechanical as dreaming up a formula or something.

Especially when dealing with data in the public sphere, and in a context in which the ideas are essentialy statements of established facts and their obvious consequences (e.g. XXX Porno Publications is going to get a big boost in earning next quarter because they have gotten a contract to be the exclusive supplier of gentlemen's magazines to the troops in Iraq), I would think that it would be difficult to determine original expression of an idea.

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That very well be true. One thing to remember about copyright law -- it protects original expression, but it doesn't protect against other people coming up with the same "original expression," as long as they do it completely independently of one another. So, if 10 different analysts used public data to analyze a particular stock, each working independently, and they all came up with the same analysis, each would be protected, and none could go after the other for infringement. However, if a later analyst came along and used the info from the previous 10 analysts, then there might be a copyright problem. A subtle difference, but there nonetheless.

There must be some level of public discourse about a businesses and business conditions which can't be protected, otherwise one would not be able to read the same bit of analysis played over and over again in different business magazines, albeit each time to a different tempo and with different phrasing. Where would I have to go to find out where the line is?

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As I noted above, if you start with RAW data -- not analysis -- it doesn't matter if you come up with the same analysis as everyone else -- you're work is just as protected as anyone esles, and you are not stepping on another's rights. However, if you start YOUR analysis by looking at OTHER'S analyses, that's when you start getting into trouble, at least from a copyright perspective.

Now, from a practical standpoint, if you are really looking far and wide and drwaing your info from many sources, the chances of anyone coming after you are probably mighty slim, and hard to prove. The place where you might be looking at trouble is if you get your info from a very small number of pulications -- so if a publication always publishes a list of 8-10 "hot stocks," and you always pick stocks from that list to review, THAT might start to look suspicious.

So overall, practically speaking, as long as your work is not some sort of summary or digest of one or two other works, you are probably okay. The more you start to look like a digest or republisher, the more you risk getting into trouble.