## Facts

- Elridge Daniel, a law student and securities investor, subscribed to Dow Jones’s fee-based “News/Retrieval” online service that delivered news reports to subscribers via computer and modem.
- The service was marketed as providing timely and accurate news and charged about $3 per minute of use.
- Daniel retrieved a report about a restructuring of Husky Oil that stated monetary amounts without indicating they were in Canadian dollars rather than U.S. dollars.
- Daniel alleged the report was false or misleading and that he relied on it in making securities transactions that caused him economic loss.
- Daniel sued Dow Jones for negligent publication of false and misleading statements, seeking to recover his investment losses.

## Issues

1. Whether a news publisher providing content through an interactive online retrieval service owes a subscriber a tort duty for negligent misstatement absent a special relationship giving rise to a duty to impart correct information.
2. Whether imposing negligence-based liability for a subscriber’s economic loss from allegedly inaccurate news content is inconsistent with New York limits on negligent misrepresentation and with constitutional protections for press activity.

## Decision

- The court, after notice, treated Dow Jones’s motion to dismiss as a motion for summary judgment under CPLR 3211(c).
- Summary judgment was granted to Dow Jones, and the complaint was dismissed.
- The court held Dow Jones owed no negligence duty to Daniel because no special relationship existed beyond that of a general news publisher and subscriber (analogous to a newspaper purchaser).
- The court declined to decide the case on contract limitation-of-liability language because the record did not establish that such terms were incorporated into the subscription contract.
- First Amendment considerations reinforced the refusal to extend negligence liability to this form of news dissemination.

## Legal Principles

- Under New York negligent misrepresentation law, recovery for economic loss based on inaccurate information generally requires a duty arising from a special relationship of trust or confidence, not a mass publisher–reader relationship.
- A news publisher (including an electronic or computerized news-retrieval service) ordinarily has no special relationship with individual subscribers and is not liable in negligence for purely economic loss caused by alleged reporting errors.
- The medium of delivery (electronic, interactive, or real-time) does not, by itself, transform a general news service into a personalized advisory service that owes a duty of care to individual users.
- Extending negligence liability for ordinary reporting inaccuracies that affect financial decisions risks chilling press activity and unduly burdening freedom of the press.

## Conclusion

The court dismissed the subscriber’s negligence claim for investment losses because the publisher of an online news-retrieval service owed no tort duty absent a special relationship, and constitutional concerns supported limiting negligence-based liability for press dissemination of news.


Daniel v. Dow Jones & Co., 137 Misc. 2d 94, 520 N.Y.S.2d 334 (Civ. Ct. N.Y.C. 1987)