Some legal theories, like the proverbial vampire, refuse to die. The common law tort of misappropriation is one such legal theory, and the recent Restatement (Third) of Unfair Competition (Restatement) may finally lead to the demise of this outdated cause of action. Misappropriation began advisedly enough as a means of protecting certain intellectual property rights from unjust usurpation, often by direct competitors employing improper means. Arising before comprehensive copyright, patent, and trademark laws were fully developed, the tort may have played an important role in protecting intangible proprietary interests.The tort's high water mark was the 1918 Supreme Court decision in International News Service v. Associated Press. Since then, the role of the misappropriation tort has withered with the expansion of statutory intellectual property rights, particularly the Copyright Act of 19763 and the Lanham Trademark Act of 1946. Nonetheless, the tort has continued to exist as an alternative--and often unbridled--avenue for relief when statutory law denies protection in particular cases. The new Restatement confronts the tort directly and contends that it no longer plays a role as an independent cause of action. This position is consistent with most cases addressing the issue, as well as with sound intellectual property policy. In particular, the tort of misappropriation threatens the existence of a well defined “public domain” of information to which the public can freely obtain access. This article contends that the Restatement's position is the correct one based upon intellectual property law and policy. The tort of misappropriation does not systematically further incentives for creative effort. At the same time, its broad definition of “unfair competition” threatens competitive freedom and consumer welfare. The misappropriation tort's ill-defined and potentially harmful breadth is unwarranted, and its demise is long overdue.
Gary Myers, The Restatement's Rejection of the Misappropriation Tort: A Victory for the Public Domain, 47 S.C. L. Rev. 673 (1996)