Who Owns Real Estate Broker Data?
There was never a question of who owned broker data before the advent of the Web. Brokers owned the listings, descriptions, and photographs they gathered and aggregated. Such content was private. And now, says still another court decision, it still is.
The importance of broker data is plain: Major web sites need broker data and therefore it has value. Because broker data has value, it follows that brokers should be able to control their data and be paid for the content they create. And “payment,” it says here, should be in the form of cash, stock, and content control — how the data is used.
It’s not just broker data that’s an issue. All those who produce “intellectual property” are equally concerned that their materials will somehow be converted into “public” property once digitized. As examples:
- When it comes to copyrights and the ownership of intellectual property, says Michael Eisner, Disney’s chairman and CEO, “Internet pirates try to hide behind some contrived New Age arguments of the Internet, but all they are really doing is trying to make a case for Age Old thievery.”
- The heavy metal rock band, Metallica, has sued Napster, Inc, alleging that the company’s software allows the band’s songs to be copied and distributed online without payment or permission. Dr. Dre, another musician, has also threatened to sue Napster for alleged copyright infringement.
- When New Hampshire adopted a tough executive order this month forbidding the use of pirated material by state offices, Mike Kosek, general manager of Microsoft, New England, said, “we are encouraged to see New Hampshire take a leadership role in addressing the issue of intellectual property rights, as both consumers and governments move into the digital era where the online world becomes the norm for business transactions.”
“Let me make very clear that we support free expressions on the Internet,” says Eisner. “We just don’t support stealing the expression of others and offering it for free.” (Emphasis his.)
Okay, if Disney, Microsoft, and musicians have intellectual property rights, why not brokers? When did MLS data that was once private become public?
Answer: It never happened.
Today’s technology makes it easy to grab someone else’s content. But the fact that mis-use is easy doesn’t make it right.
MLS data is sometimes seen as a collection of facts, just like a phone book. And it happens that the Supreme Court, in the Feist decision, ruled that one cannot copyright listings such as those found in the telephone white pages.
“To qualify for copyright protection, a work must be original to the author,” said the court.
“Original, as the term is used in copyright, means only that the work was independently created by the author (as opposed to copied from other works), and that it possesses at least some minimal degree of creativity. To be sure, the requisite level of creativity is extremely low; even a slight amount will suffice.”
And, added the Court, “the vast majority of works make the grade quite easily, as they possess some creative spark, Originality does not signify novelty; a work may be original even though it closely resembles other works, so long as the similarity is fortuitous, not the result of copying.”
But isn’t an MLS an obvious listing arrangement, just like a telephone directory?
In 1995, in Montgomery County Association of Realtors, Inc. v. Realty Photo Master Corp., this precise question arose. In this case, a court ruled that a Maryland MLS database could be copyrighted. Why? Because an MLS has several unique components including the way data is arranged and the use of a complex system of abbreviations.
The Montgomery County case is interesting for two reasons. First, the decision was issued after Feist. Second, the Montgomery County decision is routinely held up by those claiming copyright protection. For instance, in its “proposed conclusions of law” regarding the anti-trust case in which it is now involved, Microsoft cited the Montgomery County decision to bolster its copyright claims.
Given this background, it should come as absolutely no surprise that a Florida judge has just ruled that MLS data is intellectual property and that it has value.
In Realtor Association of Greater Ft. Lauderdale v Property America Corporation, the judge noted that the Association held a registered copyright for its MLS database (strong evidence, said the court, of the copyright’s validity) and that the unauthorized use of MLS data could actually or potentially impair the work’s value.
How can brokers and their MLS systems protect their data? Several strategies seem clear:
Work with an attorney to determine your rights.
Copyright MLS data in a formal registration with the U.S. Copyright Office.
Seek injunctions and damages against those who purposefully and willfully pirate data, and who refuse to stop such actions once asked.
Salt listings. This is a common practice in the mailing list industry — a list is rented for a single use and within the list are several names which go back directly to the list owner. If the list owner gets more than one mailing, the mailer then gets a second bill — or gets sued.
Mark property and personal photos with searchable “intelligent indicia.” Such symbols, which are similar to bar codes, provide a quick way to identify with certainty who owns what.
In the future, just as today, there will be continuing efforts to separate brokers from their property without compensation or control. But as always, the bottom line will remain the bottom line: the broker’s data belongs to the broker.
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Published originally by Realty Times on April 25, 2000 and posted with permission.
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