Morris Communications Corp. v. Pga Tour, Inc., 3:00-CV-1128-J-S0TJC.

• Decision Date: 13 December 2002
• Docket Number: No. 3:00-CV-1128-J-S0TJC.,3:00-CV-1128-J-S0TJC.
• Citation: 235 F.Supp.2d 1269
• Parties: MORRIS COMMUNICATIONS CORPORATION, a Georgia Corporation, Plaintiff, v. PGA TOUR, INC., Defendant.
• Court: U.S. District Court — Middle District of Florida

235 F.Supp.2d 1269

MORRIS COMMUNICATIONS CORPORATION, a Georgia Corporation, Plaintiff, v. PGA TOUR, INC., Defendant.

No. 3:00-CV-1128-J-S0TJC.

United States District Court, M.D. Florida. Jacksonville Division.

December 13, 2002.

COPYRIGHT MATERIAL OMITTED

George D. Gabel, Jr., Timothy J. Conner, Holland & Knight LLP, Jacksonville, FL, Jerome W. Hoffman, Holland & Knight, Tallahassee, FL, for Plaintiff.

Gregory F. Lunny, James M. Riley, Richard S. Vermut, Peter Andrew Smith, Rogers, Towers, Bailey, Jones & Gay, Jacksonville, FL, Jeffrey A. Mishkin, Skadden, Arps, Slate, Meagher & Flom, LLP, New York City, for Defendant.

C. Ryan Reetz, Greenberg Traurig, P.A., Miami, FL, for Intervenor.

ORDER

SCHLESINGER, District Judge.

This cause is before the Court on Defendant's Motion for Summary Judgment (Doc. No. 109, filed June 24, 2002) and Plaintiff's Response (Doc. No. 136, filed June 24, 2002); Plaintiff's Motion for Partial Summary Judgment on Liability (Doc. No. 125, filed June 24, 2002) and Defendant's Memorandum of Law in Opposition (Doc. No. 139, filed June 24, 2002)¹; and Defendant's Motion to Strike Plaintiff's Second Notice of Supplemental Authority (Doc. No. 150, filed July 16, 2002). Following a hearing during which both sides presented oral argument on the summary judgment motions, all pending motions are ripe for consideration.

As an initial matter, Defendant's Motion to Strike is DENIED.

I. Background

Introduction

Many issues revolve around the periphery of this case, and the Court will take a minute to address what the case is and is not about. The quintessential issue is who has the right to instantaneous information and its value. This case is not about the ability or right of a publisher to disseminate and profit from information and facts released into the public domain through radio or television broadcasts or through a web site. Nor is this case about the ability of the media to cover and publish information for a story in the next day's paper or even in that evening's television news coverage. The First Amendment freedom of the press, while at first blush might appear to be relevant, is not involved. See National Broadcasting Co. v. Communications Workers of America, 860 F.2d 1022, 1024 (11th Cir.1988)(stating that the First Amendment right of Free Press does not apply absent state action). The case, in general, does not resolve issues of journalistic integrity.² This case is to some extent about Morris's claimed ability or need to track a single player, ranked 100, from a small town who is not currently covered by the leader-board or being covered by the broadcast station. Morris needs access to all the players' scores to relate to a local following in that small town where its native son or daughter stands in relation to the other players in the tournament. Finally, this case is not about "streaming" video and audio or "webcasting."³

Factual Background⁴

Plaintiff, Morris Communications Corporation ("Morris"), is a Georgia corporation that publishes over thirty traditional print newspapers as well as a number of Internet-based, electronic newspapers. Defendant, PGA Tour, Inc. ("PGA Tour"), is a Maryland corporation with its principal place of business in Ponta Vedra, Florida. The PGA Tour is mainly engaged in the business of promoting professional golf tournaments throughout North America, collectively known as the PGA Tour. Players on the PGA Tour, generally recognized to be among the best golfers in the world, assign all television, radio, motion picture and other rights related to PGA Tour events to the PGA Tour, and with limited exceptions, are restricted from competing in tournaments sponsored by other entities. The record evidence in this case shows that the PGA Tour is the most widely recognized professional golfing tour in the United States. Although there are other golf tournaments which generate fan interest, few can rival PGA Tour events in terms of overall popularity.

At issue in this case is the extent to which the PGA Tour may be allowed to limit the access of Morris and other media entities to its own private golf tournaments. Specifically, the Court must resolve whether the PGA Tour may legally condition access to its tournaments on Morris's agreement not to syndicate "real-time" golf scores obtained from an on-site media center. As this Court noted in its Order denying Morris's Motion for Preliminary Injunction⁵ and as the parties have emphasized throughout these proceedings, this case is more than simply about golf scores. Rather, it presents a novel and compelling question of who has the "right" to report the news, produced and gathered by others, in an age of near-instantaneous information.

PGA Tour events are covered extensively by a number of different print, broadcast, and electronic media organizations. Although these events are conducted on private golf courses, the PGA Tour issues credentials to members of the media who are thereby invited to its tournaments for the purpose of providing media coverage. Traditionally, Morris and its subsidiary publications have been among the entities that have received media credentials to PGA Tour tournaments. Both the PGA Tour and members of the media have traditionally benefitted from this arrangement in that the media are better positioned to satisfy the public's demand for golf-related information, and the PGA Tour enjoys enhanced publicity, which in turn generates greater demand for its golf tournaments and related goods and services, thus producing revenue for the PGA Tour.

Real Time Golf Scores

The parties' dispute in this case concerns the on-line publication of "real-time" golf scores. Real-time scores, as the term suggests, are scores that are transmitted electronically nearly contemporaneously to their actual occurrence on the golf course. In this way, Internet users are able to track during a golf tournament each participating player's progress on a hole-by-hole basis. In order to improve its scoring capabilities for its tournaments, including transmission of real-time golf scores over the Internet, the PGA Tour has designed and implemented an elaborate electronic relay known as the Real-Time Scoring System ("RTSS").

RTSS works as follows: During a given golf tournament, volunteer workers called "hole reporters" follow each group of golfers on the golf course and tabulate the scores of each player at the end of each hole. The scores are then collected by other volunteers located at each of the eighteen greens on the golf course, who, with the aid of hand-held wireless radios, relay the scoring information to a remote production truck staffed by personnel employed by the PGA Tour.⁶ The scores of all participating golfers are then processed at the remote production truck and transmitted by the PGA Tour to its Internet website, pgatour.com. The PGA Tour claims that it takes "about five minutes" for the information to be routed from the production truck to pgatour.com. At the same time, real-time scores are also transmitted to an on-site media center where accredited members of the media are able to access the scores. The same information is also transmitted to various electronic "leaderboards" located throughout the golf course for public viewing by spectators. The leaderboards do not simultaneously show the real time scores of all participating golfers. Rather, they typically show only the top ten or fifteen scores.

Due to the nature and size of golf courses, which may span as much as 150 acres, comprehensive real-time scores — that is, up-to-the-minute scores of every competitor — can only be compiled using a relay system such as RTSS. During a golf tournament, different groups of players compete contemporaneously at different holes such that any one spectator can only view a limited number of players at any one of the eighteen holes. Thus, in order to generate real-time scores, it is necessary to have individuals stationed at each hole as the tournament progresses so that the entire golf course can be monitored simultaneously. Acknowledging that some kind of relay system is needed to generate the type of real-time scoring information it wishes to syndicate, Morris submits that it is unable to implement such a system itself due to the PGA Tour rules prohibiting unauthorized use of wireless communication devices on the golf course at its tournaments.⁷

Although the exact amount is unknown, it appears that the PGA Tour has invested tens of millions of dollars in RTSS, dating back to the early 1980s. Nevertheless, not all of this investment has been devoted solely to developing Internet-based scoring. The Internet did not rise to prominence until at least the mid-1990s, and pgatour.com did not become operational until 1997. Moreover, the evidence in this case shows that RTSS was, and continues to be, developed with an eye toward enhancing the on-site scoreboards for live spectators and for television broadcasts. For example, Ken Finchem, who is presently the Commissioner of the PGA Tour, noted in 1990 that "the electronic score-board system was created to provide the growing number of spectators at PGA Tour tournaments with up to the minute information on action all around the course."

Additionally, the Internet presently represents only a small fraction of the PGA Tour's overall revenue. For example, the PGA Tour's annual revenues from its Internet syndication contracts is approximately $130,000. In contrast, a 1999 financial audit of the PGA Tour revealed "direct" revenues of $306,510,000, which included revenues from television and tournaments.

Nevertheless, the PGA Tour has made no secret in this litigation of its desire to maintain a commercial advantage in the market for selling real-time golf scores and has vigorously defended its right to protect its proprietary investment in RTSS. To that end, it has enacted a series of regulations designed to prevent potential competitors from immediately...