Apple thwarted in bid to unmask leaker

Appeals court rules that communications between a product leaker and an enthusiast Web site are protected by law.

Ina Fried Former Staff writer, CNET News
During her years at CNET News, Ina Fried changed beats several times, changed genders once, and covered both of the Pirates of Silicon Valley.
Ina Fried
4 min read
Apple Computer suffered a setback in its effort to plug an internal leak, after a state appeals court ruled that the computer maker can't immediately get its hands on records of who may have contacted an Apple enthusiast site with details on an unreleased product.

A lower court had ruled Apple should have access to the records of AppleInsider as it tried to unmask who had revealed information about an unreleased product. On Friday, though, the California appeals court ruled (click here for PDF) that the communications between the product leaker and the enthusiast Web site are protected by federal and state law.

The three-judge appeals court had appeared to take a dim view of Apple's case in a hearing last month.

The court's ruling is a boon to those who argued that journalists, including bloggers, should be entitled to protect confidential sources, and a setback for those who said that intellectual-property rights, in this case trade secret law, should take precedence.

Court shields Web sites
A California appeals court ruled Friday that independent Web publishers should be treated as journalists under the state constitution. Here's the relevant section:

"A publisher, editor, reporter or other person connected with or employed upon a newspaper, magazine, or other periodical publication...shall not be adjudged in contempt by a judicial, legislative or administrative body, or any other body having the power to issue subpoenas, for refusing to disclose the source of any information procured...for publication...or for refusing to disclose any unpublished information obtained or prepared in gathering, receiving or processing of information for communication to the public."

Source: California Constitution

"Today's decision is a victory for the rights of journalists, whether online or offline, and for the public at large," Kurt Opsahl, a staff attorney for the Electronic Frontier Foundation, said in a statement. Opsahl argued on behalf of AppleInsider at last month's hearing. "The court has upheld the strong protections for the free flow of information to the press, and from the press to the public."

Peter Scheer, executive director of the California First Amendment Coalition, agreed. "It's a very important case in a couple of respects. One key respect is it addresses the whole problem of protecting confidential sources when the reporter is not a traditional mainstream newspaper reporter," he said. The court's ruling that sites like AppleInsider are protected by the California Shield Law is heartening for the growing legions of bloggers reporting on companies and governments, he said.

But there was probably another motive behind Apple's request for AppleInsider's communications, Scheer said. Apple "probably initiated the litigation to scare employees, to deter further leaking. As of today, that strategy has backfired badly."

Apple representatives were not immediately available for comment.

"I'm extremely gratified by the court's decision, as it recognizes the importance of allowing online journalists to protect the confidentiality of their sources," said Kasper Jade, the pseudonymous publisher and editor-in-chief of AppleInsider. "It's a great victory for journalists of all stripes."

Shield law protections
The appeals court pointedly took issue with Apple's argument that the Web sites were not legitimate journalistic enterprises. Apple had claimed that the sites were engaged not in "legitimate journalism or news" but instead in "trade secret misappropriation" and copyright violations.

Judge Conrad Rushing of the California Court of Appeal, Sixth Appellate District, who wrote the opinion, said: "We decline the implicit invitation to embroil ourselves in questions of what constitutes 'legitimate journalism.'" To do otherwise, Rushing warned, would imperil the very values the First Amendment was intended to protect.

Rushing and his two colleagues went even further, saying that the California reporter's shield law protects Web publishers--which appears to be the first decision that makes such status official. "Beyond casting aspersions on the legitimacy of petitioners' enterprise, Apple offers no cogent reason to conclude that they fall outside the shield law's protection," Rushing wrote.

California's shield law, like many such laws in other states, was written long before the Internet became popular. It protects anyone currently or previously employed by "a newspaper, magazine or other periodical publication, or by a press association or wire service." (The term "other periodical publication" was added in 1974.)

The court said the intent of the legislature was to be generous with that definition--and concluded that "petitioners' Web sites are highly analogous to printed publications" and should enjoy the same legal protections against divulging their sources.

The three-judge panel overturned Santa Clara County Superior Court Judge James P. Kleinberg's ruling from March 2005 and ordered him to grant the Web sites a protective order. The judges said that the Web sites' status as journalistic enterprises, coupled with Apple's half-hearted efforts to investigate the leak internally and exhaust other sources of information, justified granting the order.

Apple is not suing AppleInsider directly in the lawsuit, which dates to 2004, but had sought subpoenas to obtain e-mail records of AppleInsider and another site, PowerPage.org. In a separate case, Apple directly sued another enthusiast site, Think Secret, alleging that it directly infringed on Apple's trade secrets by soliciting inside information.

In a telephone interview, Opsahl said Friday's ruling could help Think Secret in its bid to get Apple's lawsuit thrown out. "Perhaps this opinion will be useful to the court's decision in that (case)."

CNET News.com's Tom Krazit contributed to this report.