The AP argues that Meltwater is a clipping service that doesn't pay for the papers it "clips" from. In addition, while recognizing that their summaries do not violate copyright, that if you add up the headline and "a short snippet of text," Meltwater clients might obtain a significant percentage of a story, violating the limits of fair use. The AP also argues that that Meltwater, by providing a link to the original story, may be contributing to later copyright violations by the clients.
Those claims, Meltwater alleges in a formal response filed in the suit, that the type of violations AP alleges challenge the core functions of search engines. The Courts long ago found that search engines use of such content fell under fair use. It is difficult to see how Meltwater differs, except in providing their own summaries, which in fact would be original stories that Meltwater held copyright to.
In commenting on the suit, one blogger noted the dangerous precedent of the AP's "contributory" argument -
Because users can cut and paste AP stories from their original websites and “save” them in a Meltwater archive, Meltwater is guilty of violating copyright law. Under that argument, so is any email program or word processing program.The filing also contains the foundation for a countersuit, arguing that the AP's very public pursuit of the infringement claim has disrupted its business relationships and scaring away prospective clients.
Its hard to see, from the reports anyway, that the AP even has the standing to sue (that would depend on whether Meltwater uses AP wire reports, or newspaper articles based on them). It also seems like the AP is trying to argue that Meltwater's actions might result in infringement (by themselves or their clients), rather than basing the suit on actual evidence of wrongdoing. That last is a disturbing trend in IP policy and Court cases - using the possibility of infringement, rather than actual violation, as the basis for legal action.
Source - Meltwater says AP's copyright lawsuit threatens all search engines, Poynter MediaWire