Theflyonthewall.com has pressed U.S. District Judge Denise Cote to remove the ban she placed on the company in March in a case brought against them by banking giants Bank of America (NYSE:BAC), Morgan Stanley (NYSE:MS) and Barclays (LSE:BARC).
The request by Theflyonthewall.com came from the decision by Cote to restrict the company from dessiminating research for at least two hours after receiving the information.
According to Cote, the information released by Theflyonthewall.com to its subscribers was “systematic misappropriation,” and constituted a “free ride” in regard to quickly releasing upgrades and downgrades of companies which came from the banks in the case listed above.
What the case centered around was the timing of the release of the information provided by Theflyonthewall.com to its subscribers, which was released before the markets opened. To disallow that, Cote ruled the company must wait until 10 a.m. before releasing the information, and a minimum of two hours for any research they release after that time. Cote gave Theflyonthewall.com a year before they could apply to have the injunction against them lifted; time the company says they don’t have if they are to survive.
According to Theflyonthewall.com, the restrictions on them could violate the first amendment, and since hasn’t been applied to any of their competitors, puts them at an unfair competitive disadvantage.
Glenn F. Ostrager lawyer for Theflyonthewall.com concluded, “A decision by the Court of Appeals vacating or modifying this court’s injunction would be of little real significance if defendant is essentially ‘put out of business’ during the appeal process.” Ostrager added, “Defendant submits that recommendations of Wall Street firms are legitimate news and highly significant to public in general.”