U.S. District Judge Kevin Castel agreed to dismiss two counts of the Associated Press lawsuit against All Headline News but will hear the news coop’s claims that the aggregator is misappropriating “hot news.” AHN wanted the case, now in U.S. District Court for the Southern District of New York, to be considered under Florida law, where it is based and which they claim has already rejected the “hot news” argument—and it claimed federal copyright law preempts the claim. Neither argument won over the judge. The idea of treating “hot news” or “breaking news” differently from other news dates back to International News Service v. Associated Press, a 1918 Supreme Court decision holding that breaking news is the “quasi property” of a news-gathering organization and that allowing one news agency to profit from the work of another “would render publication profitless, or so little profitable as in effect to cut off the service by rendering the cost prohibitive in comparison with the return.” That may have been preempted by federal law but it is still recognized as a cause of action in many states.

The lawsuit has been pending since January 2008.

Full court filing embedded after the jump