Daring Fireball on the NYT and Think Secret

John Gruber writes on  the differences between Think Secret and the New York Times, in On the Credibility of The New York Times. One passage sticks out:

Markoff quotes analysts and unnamed individuals “close to the company”, but offers no genuine inside information from Apple employees. Now, obviously, one reason for that is that he was wrong — Apple was not on the cusp of releasing an iPhone in 2002. But even if Apple had gone on to release an iPhone soon after Markoff’s report, it wouldn’t have been grounds for Apple to sue The Times. Speculation is not a violation of trade secret law.

Ignore the fact that Markoff was wrong, for a second, and suppose that he was right. Who were those “sources close to the company”? Almost certainly, they were third parties – developers, hardware makers, or major customers – who had been briefed about the putative product under NDA. Markoff, of course, would have spoken to these people and asked them if they knew anything. At no point would he have asked them to break an NDA – in fact, as standard procedure, he wouldn’t have even asked if they were under NDA.

However, he would certainly have known that the information published would have been a trade secret under the restrictive definition that the court has applied. He would also have been guilty of soliciting for trade secrets simply by asking if someone knew anything about a new Apple product. He would certainly have offered the source anonymity – again, an inducement under the rules the court in the recent case has laid out. Clearly, John G is wrong on this one: Apple would have had grounds to sue.

Now, what was that difference between the NYT and Think Secret again? In this case, there is none. Of course, the real difference is simply that Apple wants to keep on the right side of the NYT, because it values positive coverage from the paper.

  • John

    Well, there was a difference, namely, Apple did not release the product. This leads to at least two possibilities:

    1. The people spoken to by Markoff were not speaking from knowledge of protected information, evidenced by their information being wrong. They may have simply been speculating given all the trends at the time and they may have had other reasons for desiring anonymity.

    2. The people were leaking protected information about something in Apple’s labs, but since Apple had chosen not to release such a product, there was no “independent economic value” involved.

    In both cases, Apple would have no basis to sue. Therefore, your conclusion, about not suing the NYT because they wanted good relations, cannot use this single point as its basis. You may be right but this example by itself doesn’t demonstrate it.

  • http://technovia.typepad.com Ian Betteridge

    John G is claiming that, as the quote above clearly states, “even if Apple had gone on to release an iPhone soon after Markoff’s report, it wouldn’t have been grounds for Apple to sue The Times.” Therefore, neither of your points is valid.

  • John

    Okay, Ian, you’ve pulled me back into this. So first, my points are valid regarding the actual scenario I mentioned. But let’s back up and look at this in detail. Given that there are two actual cases (Asteroid and Think Secret), let’s deal with them separately.

    1. Asteroid case: Would Apple subpoena the NYT for access to its sources if the iPhone was real? First, Apple would need to show that the published information come from protected information (which they did in the Asteroid case –picture, spec list- see ruling). If Apple could, based on the Kleinberg ruling, the answer would be yes. So if the NYT was the initial source of that Asteroid picture, I believe they would’ve been subpoenaed.

    Now to the iPhone, I haven’t read and don’t have access to the Markoff article, but let’s assume the specs were exactly right. If the article had no copied diagrams or codenames but only referenced people “close to the company,” I think Apple would have a hard time showing that Markoff used protected information containing trade secrets instead of good marketing/engineering sources who could anticipate what would be a good Apple product given the industry possibilities. Apple might choose not to sue given this difficulty.

    2. Think Secret case: Would Apple sue the NYT for violating its trade secrets? Again, Apple would need to show that the published information come from protected information. I believe that the NYT (and most sites) would’ve pulled the article if Apple showed them proof. But Think Secret refused even after Apple told them that this is a trade secret. So now we get to the question of exactly how does Apple know if your information came from protected documents? I don’t know as Apple has not ever had such a conversation with me. But here are some possibilities:

    1. Picture of the protected document (or portions thereof).

    2. Boasting that you have in possession or have seen an internal Apple document.

    3. Use of codename and specification list – possibly the list has the specifications in exactly the same order as it was in the protected document. Apple could use a codename variant for each variation of a single product, i.e. Q7 for spec list A, Q7a for spec list B, which differs from A in processor speed, product size, button arrangement, or release date, etc.

    The iPhone article does not seem to rise to this level. Even Mary Jo Foley’s work does not.

    But here’s the key: Apple believes it has two made-to-order cases where it can prove its case – it doesn’t matter who the publisher is. All that other stuff we talk about is extraneous. In the Asteroid case, Apple has a specific NEED TO KNOW CONFIDENTIAL document that is clearly violated. In the Think Secret case, Apple has something (not yet shown) regarding iWork and Mac mini documents and TS’ refusal to comply (more to come as the case evolves).

    Apple knows it can’t plug all leaks and it can’t stop rumors. But I think here are two hanging curveballs that Apple knows it can hit out of the park in its quest to find NDA breakers and sites that refuse to comply when requested to remove protected info.

  • http://technovia.typepad.com Ian Betteridge

    John, glad you’re back and thanks for the comments :)

    I’m busy writing a story revealing Apple’s product plans for the next decade, so I can’t reply to all your (well presented and thought out) comments. But to mention one thing: given that we already have iWork, iSync 1.1 and the Mac mini, I can’t wait to see what *extra* Apple can show the court to prove that TS printed its trade secrest. Particularly given that the TS report on the Mac mini wasn’t even all that accurate :)

  • John

    Here’s a product tip for your story: iFlix Movie Store

    Here’s why: iFlix and iFlicks websites/software have QUIETLY disappeared (just like people do in North Korea), but that’s old news. New news: Apple joining the Blu-ray consortium leads me to believe that Apple has a DRM for H.264 digital HD movies both for digital downloads and writing to a Blu-ray DVD. Jobs said last year that the movie studios should not allow digital downloads until movies are secure, or unless computers would not have HD-capable DVD-writers. Sony, Disney, 20th Century Fox are also members of the Blu-ray Board.

    Disclaimer: I have not used internal documents or codenames. I have no sources close to the company. If you’re contacted by Apple, do not reveal my email address. Oh, shoot, it’s revealed automatically!

    Have a great day/evening!