You may have heard about an important case between Reorg Research and Murray Energy. The case was a potential landmark for journalists and media organizations in New York and beyond. We fought like hell to protect what we knew was right.

Today, we won. 

Here is a link to the opinion: Reorg Murray Decision.

In a unanimous 5-0 decision, the First Department Appellate Division of the New York Supreme Court ruled that Reorg Research’s editorial team is protected by New York’s Shield Law from being compelled to disclose the identities of its confidential sources.

The court held that “because it is a ‘professional medium or agency which has as one of its main functions the dissemination of news to the public,’” Reorg has the benefit of the shield law and is exempt from having to comply with Murray Energy’s request that it reveal its sources.

The decision arose from a “pre-action disclosure petition” that Murray Energy filed with the New York Supreme Court in September after Reorg Research published two stories that reported Murray’s financial results and an agreement between the company and one of its labor unions.

The court noted that while Reorg has a “relatively limited subscriber base” that pays “relatively high” subscription fees and agrees to limited restrictions on further dissemination of its stories, these features are “not uncommon” in today’s media landscape and that the result of ruling in Murray’s favor “is not broader coverage but no coverage at all.”

In a coda likely to resonate far beyond the distressed debt community, the court ended its opinion by noting that “[e]xtending protection to [Reorg] under the Shield Law is consistent with New York’s ‘long tradition...of providing the utmost protection of freedom of the press’” and “[t]o condition coverage on a fact-intensive inquiry analyzing a publication’s number of subscribers, subscription fees, and the extent to which it allows further dissemination of information is unworkable and would create substantial prospective uncertainty, leading to a potential “chilling” effect.”

I want to thank our amazing team at Davis Wright Tremaine, the amici, our general counsel Jude Gorman and finally, the amazing team of journalists and contributors at Reorg who day in and day out, provide the world's most comprehensive and in-depth coverage of the high yield and distressed debt market.

-Kent