The 11th U.S. Circuit Court of Appeals has scheduled oral arguments Aug. 17 in Atlanta on the dispute between Fastcase and Casemaker over the latter’s claims of copyright in Georgia administrative regulations.

Fastcase sued Casemaker in federal court in Atlanta in 2016 after Casemaker served it a written notice demanding that it remove Georgia administrative rules and regulations from its research collection. Casemaker’s parent company, Lawriter, has an agreement with the Georgia Secretary of State designating it as the exclusive publisher of the Georgia Rules and Regulations and giving it the right to license that content to other publishers.

After the court dismissed that lawsuit without prejudice in January 2017, Fastcase filed a second complaint against Casemaker in February 2017. Casemaker filed a motion to dismiss that second lawsuit. In July 2017, the court granted the motion to dismiss, concluding that it lacked subject-matter jurisdiction because Casemaker had never registered a copyright in the Georgia regulations. Fastcase appealed to the 11th Circuit.

In its brief on appeal, Fastcase — represented by Baker Donelson attorneys Robert G. Brazier, Steven G. Hall and Joshua Tropper — argues that the district court erred in concluding that it lacked jurisdiction. Fastcase argues that jurisdiction exists on two grounds:

  • Diversity jurisdiction based on the amount in controversy. Fastcase alleges that its potential losses exceed the $75,000 amount-in-controversy requirement. The district court ruled that Fastcase failed to provide sufficient evidence to establish this and that the value of the litigation was therefore too speculative and immeasurable. Fastcase argues that the district court applied the wrong legal standard in making this ruling and should have found diversity jurisdiction.
  • Subject-matter jurisdiction based on Lawriter’s threat to sue Fastcase for copyright infringement. The district court concluded that it lacked subject-matter jurisdiction because Casemaker failed to register its copyright. Fastcase argues that Casemaker’s threat of a copyright infringement suit was one it could easily make good on and was sufficient grounds to establish federal copyright jurisdiction.

In its brief to the 11th Circuit, Casemaker — represented by Kurt M. Rozelsky and Joseph W. Rohe of Smith Moore Leatherwood in Greenville, S.C. — defends the district court’s dismissal. It argues:

  • Diversity jurisdiction does not exist. It contends that in cases seeking declaratory judgment, such as this, the plaintiff bears the burden of proving that the amount in controversy exceeds $75,000. Fastcase’s claims of damages were purely hypothetical, it argues, and the district court therefore was correct in dismissing the case.
  • Subject-matter jurisdiction does not exist. It says that established 11th Circuit precedent requires a copyright holder to have at least applied to register a copyright in order to invoke subject-matter jurisdiction. Not only has it not even applied for copyright, it says, but it has provided Fastcase a covenant not to sue for copyright infringement.

In a further reply brief, Fastcase portrays Casemaker’s arguments as “litigation gymnastics” designed to preserve its “exclusive copyright-like rights” in Georgia’s regulations.

Simply put, full, free and unfettered access to our laws is vital to our democracy and cannot be defeated by carefully orchestrated efforts to restrict access and evade judicial review. This case presents, at its core, a single simple, but very important question, fundamentally a matter of federal law: can a private party — with or without the complicity of a governmental office — obtain and exercise exclusive copyright-like rights to the publication of public law? Putting aside strategic artifice, it cannot.

In an email exchange earlier this year, Fastcase CEO Ed Walters said that he considers it a good sign for Fastcase that the 11th Circuit requested oral arguments. “If the district court had the Eleventh Circuit’s precedents right, the court of appeals could simply affirm without argument,” he said.

When I reached out to Casemaker earlier this year about the appeal, the company declined to comment.

The legal research company Casemaker has quietly changed its leadership, as long-time CEO David Harriman retired in January and two legal publishing veterans were named to oversee the company.

Taking over as chief operating officer is Sarah Gorman, who has worked in legal publishing for more than 30 years. Gorman, who was named COO last October, has been with Lawriter LLC, Casemaker’s parent company, since 2000. She started her career in publishing with the Michie Company in 1989 and held a number of management positions in LexisNexis.  She has a law degree from Washington and Lee University and is a member of the Virginia bar.

Named chief information officer is Dan McCade, who has 30 years of experience in the technology industry, with degrees in computer science, information systems and business. After working as an IT consultant on federal and state government projects, he has spent the last 18 years working on various online legal research platforms.

These changes became more visible this week as Casemaker launched a redesign of its company website, with a new look and feel and an expanded offering of instructional videos and webinars.

The Ohio State Bar Association started Casemaker in 1999 as an online legal research service for its members. As other bar associations began to participate in the service, it was sold to a private company in 2008, and then the next year to legal research service JuriSearch.

Harriman was formerly CEO and editor-in-chief of The Michie Company. He joined Casemaker in 2002, when JuriSearch bought the National Law Library and BriefReporter.

The chairman and CEO of Casemaker’s parent company Lawriter remains Satish Sheth, a physician who has overseen the company since 2001, while also maintaining a full-time practice as a pediatrician in California.

The Mississippi Bar today announced that it is switching the research service it offers as a free benefit to its members from Casemaker to Fastcase. The switch will take effect for its more than 9,000 members on June 1.

“This new partnership allows us to support our members by providing free access to tools that will benefit them in their practice of law,” said Deanne Mosley, executive director of The Mississippi Bar, in a statement announcing the switch. “We’re proud to partner with Fastcase to provide access to such innovative research tools and online law libraries.”

Mississippi Bar members will be able to access Fastcase through the bar website at www.msbar.org, where they will be able to log in with their bar username and password.

According to Fastcase, 30 state bar associations and dozens of metro, county, and specialty bar associations offer its service as a free benefit to members. Through those partnerships, Fastcase says, its service is available for free to more than 800,000 lawyers — two-thirds of all lawyers in the U.S.

Twelve of those states switched to Fastcase after previously offering a different legal research service. Ten switched from Casemaker to Fastcase.

In 2016, the Minnesota Bar made the reverse switch, from Fastcase to Casemaker, only to reverse itself six months later.

 

Westlaw and LexisNexis are typically viewed as the dominant leaders among legal research services. But a recent survey found that Fastcase is in a virtual dead heat with Westlaw and LexisNexis among smaller-firm lawyers.

The just-released information comes from a survey conducted in 2016 by law practice management company Clio. The survey asked Clio users what tool they use for legal research. Out of 2,162 respondents, their top-three answers were:

  1. Westlaw, 20.58 percent (445 respondents).
  2. Fastcase, 20.35 percent (440 respondents).
  3. LexisNexis, 20.21 percent (437 respondents).

As you can see from the numbers, this is a virtual tie, with only eight responses separating the top three.

Next in order was Google Scholar, named by 13.6 percent of respondents, and Casemaker, named by 10.22 percent of respondents.

Two important caveats to note:

  1. Clio’s users are primarily solo, small and mid-sized firms. Larger firms are not represented in these numbers.
  2. Clio and Fastcase have an integration which may prompt more Clio users to use Fastcase.

“There’s no ‘big two’ in legal research anymore,” Fastcase CEO Ed Walters said this morning. “From now on, it’s the big three – and Fastcase is still growing.”

The legal research service Casemaker has partnered with the international legal research service vLex in a joint licensing agreement that gives clients of both companies access to more of the world’s laws.

The agreement enables Casemaker clients for the first time to search for international case law and materials directly from Casemaker’s website. vLex clients will receive access to Casemaker’s full collection of U.S. federal and state case law, codes, regulations, court rules and constitutions, as well as its CaseCheck+ negative citator system.

Casemaker is a legal research service that is offered free to members of some two-dozen bar association in the U.S. It is based in Charlottesville, Va.

vLex is an international legal research service with materials from more than 100 countries. Its collection includes case law, contracts and forms, books and journals, and other materials.

vLex was founded in Barcelona in 1998 and Spain remains the source of half its revenue. The other half comes from the United States and Latin America.

The company is co-headquartered in Barcelona and Miami and has offices in Madrid, Mexico City, Sao Paulo, Bogotá, Buenos Aires, Santiago de Chile and Lima.

A week ago, I reported here that that a federal judge in Georgia had dismissed without prejudice Fastcase’s declaratory judgment lawsuit against Casemaker over the latter’s claims of copyright in Georgia state regulations. Yesterday, Fastcase refiled the suit.

The court had dismissed Fastcase’s lawsuit for lack of jurisdiction on two grounds. One was that, because Casemaker had never registered a copyright in the materials at issue, it would not be entitled to file an infringement action against Fastcase. The second reason was for lack of diversity jurisdiction. The judge concluded that Fastcase had failed to meet the amount-in-controversy threshold for diversity jurisdiction of $75,000 because it had failed to allege damages with sufficient specificity.

In the complaint filed yesterday, Fastcase has now pled its damages with specificity.

“The State Bar of Georgia requires us to include the Georgia Regulations as part of its state bar member benefit,” Fastcase CEO Ed Walters told me. “If we don’t, we risk being in breach of that contract, which is for more than $75,000 per year.”

In addition, he said that Casemaker’s terms of use on the Georgia regulations site say that every visit to the site for commercial purposes, every download of the regulations, and every commercial sale is in violation and that, “If you violate this agreement, or if you access or use this website in violation of this agreement, you agree that Lawriter will suffer damages of at least $20,000.”

“Since we ordinarily update these sites multiple times per week, and sell access to the Georgia regs multiple times per day, Casemaker’s own valuation of its damages puts the amount in dispute more than $75,000,” Walters said.

Read the full complaint here: complaint filed 2/2/17.

[Updated 1/27/17, 11 a.m. Eastern, to add comments of Fastcase CEO Ed Walters.]

A lawsuit by Fastcase against Casemaker that many hoped would define the parameters of copyright in government information has been dismissed for lack of jurisdiction.

A year ago, Fastcase preemptively filed the declaratory judgment lawsuit against Casemaker in federal court in Atlanta after Casemaker served it a written notice demanding it take down from its research collection the Georgia Administrative Rules and Regulations.

Casemaker’s parent company, Lawriter, has an agreement with the Georgia Secretary of State designating it as the exclusive publisher of the Georgia regulations and giving it the right to license that content to other publishers. But Fastcase maintains that the regulations are public law in the public domain and that Casemaker cannot claim an exclusive right to their publication.

Yesterday, U.S. District Judge Timothy C. Batten Sr., ruling on Fastcase’s motion for summary judgment, denied the motion and dismissed the lawsuit without prejudice, meaning that Fastcase is not barred from refiling the lawsuit in another court.

Judge Batten concluded that the federal court lacked jurisdiction over the lawsuit. He reached that conclusion on two grounds.

First, he said that there is no cause of action under federal law. The only federal claims potentially implicated by Casemaker’s threatened litigation are copyright claims, he said. But because Casemaker has never registered a copyright in the materials at issue, it would not be entitled to file an infringement action in federal court.

The 11th U.S. Circuit Court of Appeals has squarely ruled, Judge Batten said, that where a copyright owner could not sustain an infringement action in federal court, then the would-be defendant in a potential coercive action cannot bring an anticipatory declaratory judgement action.

“The fact that Lawriter continues to threaten legal action, including under the copyright laws, does not alter the effect of the Eleventh Circuit’s decision,” Judge Batten said.

Judge Batten’s second reason for dismissing the action was lack of diversity jurisdiction. He concluded that Fastcase failed to establish that the case met the amount-in-controversy threshold for diversity jurisdiction of $75,000.

Fastcase attempts to carry this burden first by pointing out that it ‘has sold, or offered to sell, access to electronic databases including the Georgia Regulations with a cumulative value in excess of $75,000.’ But the Georgia Regulations are just one component of Fastcase’s database, and that is the only component at issue in this lawsuit. Therefore, any monetary value that Fastcase stands to gain from a judicial victory must be measured not by its total subscription revenue but rather by the incremental value of including access to the Georgia Regulations in those subscriptions. … Fastcase has not even attempted to quantify the value to it of continued access to the Georgia Regulations, and allegations about its cumulative subscription revenue for the database as a whole do not carry the day.

The full memorandum is embedded below. You can also find it at this link.

Fastcase CEO Responds

In an email this morning, Ed Walters, CEO of Fastcase, indicated that he sees the ruling as a partial victory:

We want the court to establish that private companies can’t own public law. That seems simple enough. Although the court dismissed our suit on jurisdictional grounds, it’s an important copyright precedent. One of the reasons the court believes it doesn’t have jurisdiction is because Casemaker can’t make a colorable claim to copyright in the Georgia Regulations. It hasn’t filed the copyright, and the copyright office has said that it won’t register copyright in public law. After the court’s holding here, copyright is off the table.

Casemaker has tried to wiggle out of this lawsuit by creating its own little private copyright. When you click OK on the Georgia Regulations now, Casemaker believes that you create a private contract granting Casemaker the same rights that they can’t get in copyright – the right to exclude others, set prices, threaten lawsuits, and the like. Wrong in copyright, wrong in contract. We just won the first part. This is the beginning, not the end.

Related Litigation

A second lawsuit over Georgia’s claims of copyright in state law remains pending. In that case, the state of Georgia has sued Public Resource, a site run by Carl Malamud that is devoted to making government information more accessible to the public at large, over its copying and publishing of the Official Code of Georgia Annotated.

CasemakerHome

Earlier this week, I wrote about the Minnesota State Bar Association’s decision to switch back to Fastcase as a member legal-research benefit, just six months after leaving Fastcase for Casemaker. Although I had reached out to Casemaker for comment, I did not hear back from the company until after I published that post. Yesterday, I had the opportunity to discuss the Minnesota situation with David Harriman, Casemaker’s CEO; Jim Corbett, director of business development; and Linda Franklin, director of client relations. Most of the comments were provided by Corbett.

I will provide more details below. But I would sum up our conversation by saying that Casemaker made two overarching points with regard to Minnesota’s decision:

  1. The reason the bar chose to switch to Casemaker in the first place was that it is in fact a superior research platform.
  2. Member dissatisfaction with Casemaker resulted from circumstances and misunderstandings unrelated to the core Casemaker service or platform.

Let me expand on each of those points.

A Rigorous Evaluation Process

Corbett started off by saying that there were compelling reasons why the Minnesota bar made the switch last June from Fastcase to Casemaker. Before making the switch, the bar appointed a study committee and went through a rigorous evaluation process. At the end of the process, Corbett said, the bar chose Casemaker for several reasons.

Key among the reasons was that the bar concluded that Casemaker has a superior citator. Whereas Casemaker has a comprehensive and integrated citator on a par with Shepard’s or KeyCite, Corbett asserted, Fastcase has only an automated tool that is not a real citator. “The bar was concerned that their members were not getting the advantage of a citator and they were impressed with ours.”

Another key reason the bar chose Casemaker, Corbett said, is that the statutes and administrative codes it provides are “bar none the most current of any online, including Westlaw and Lexis.” Casemaker’s CEO Harriman was formerly president of The Michie Company, and when LexisNexis acquired Michie, Casemaker hired its statute editors. These editors track all 50 state legislatures and the U.S. Congress and, as bills are enacted, they typically get them online within four days. Historically, Corbett says, Fastcase updated its codes only once a year.

(Let me interject that the purpose of this post is not to get into a factual, head-to-head comparison. I am simply reporting my conversation with Casemaker. For example, as to the latter point, Fastcase CEO Ed Walters says it is not true and that Fastcase regularly, for many states daily, updates its codes. I did write a head-to-head comparison in 2009 and clearly it is time for an update. But that will have to wait for another day.)

Still another reason, Corbett said, was the Casemaker Digest, its service for keeping subscribers up to date on case law developments of interest to their practice areas. Prior to switching to Casemaker, the Minnesota bar was producing its own update service for members. Part of its reason for switching was replace its service with Casemaker’s and thereby free up staff time for other purposes.

Two further reasons the bar switched, according to Corbett, were:

  • User interface. “To a man, everybody on the evaluation committee agreed the Casemaker interface was far easier and more intuitive than the Fastcase interface,” Corbett says.
  • Collection of materials. “It was clearly demonstrated to the evaluation committee that Casemaker has a more comprehensive collection of material,” Corbett says. “There are many materials we have that just don’t exist in Fastcase.”

“No bar committee takes a process like this lightly,” Corbett said. “It was a very thorough and very intensive process. They looked at all these advantages and thought, this is a compelling reason to make the change.”

Circumstances after the Switch

When Casemaker learned that the bar had decided to switch back to Fastcase, “we were disappointed,” Corbett said. He attributes the decision to two circumstances that arose after the bar implemented the Casemaker service in June.

The first had to do with the digest service. To operate the digest service in the way that the bar envisioned, Casemaker had to make several adjustments to its existing service, Corbett said. Before it was done making those adjustments and before the service was ready, the bar released the service to its members. As a result, Corbett said, it did not work well and caused a lot of frustration among the members who were using the digest service.

Members began to complain about the service and say that they wanted to go back to the digest reports that Fastcase had been providing, not realizing that it had been the bar, not Fastcase, previously providing the service.

“They attributed this benefit to Fastcase when Fastcase had nothing to do with it,” Corbett said. “We got lambasted for the bar’s releasing this product early. Fastcase got credit for something they weren’t even doing.”

Casemaker continued to work on improving the digest product and was finally ready to roll out the improved version when the bar announced its return to Fastcase.

The other circumstance related to the organization of the Minnesota bar. The bar’s CLE arm, Minnesota CLE, is a separate non-profit corporation from the bar itself. In other states where Casemaker is a member benefit, it works with the bars to provide extensive member training programs, Corbett said. But because of the separation between the bar and its CLE entity, Minnesota never gave Casemaker the opportunity to provide such training.

“We weren’t able to show people the advantages that Casemaker has over Fastcase,” he said.

It was these two circumstances that led to members’ complaints, Corbett said, and the bar never gave Casemaker a chance to remedy them. “When these two things that were beyond our control happened, the bar responded to comments from their members who were frustrated. The bar did not call us and say, ‘Let’s create a program to correct these problems.’”

None of this should be taken as evidence that Fastcase is superior to Casemaker, Corbett argued. “This does not prove, as Fastcase says, that it is a superior service. We have the superior service. That is why the Minnesota bar chose Casemaker after an extensive evaluation. These other things were added in that had nothing to do with the core product.”

“I’m not saying they didn’t give us a fair chance,” he continued. “We thoroughly enjoyed working with the staff there. They believed that they were responding to the will of their members. But I think the will of their members was distorted by attributing value to Fastcase that which Fastcase had nothing to do with.”

Gavel

When last we left the litigation between Fastcase and Casemaker, it was mid-May and Fastcase had just filed a motion for summary judgment. A lot has happened since then, including just this week, so let me bring you up to date.

But first, to recap: Last February, Fastcase preemptively filed the declaratory judgment lawsuit in federal court in Atlanta after Casemaker served it a written notice demanding it take down from its research collection the Georgia Administrative Rules and Regulations.

Casemaker’s parent company, Lawriter, has an agreement with the Georgia Secretary of State designating it as the exclusive publisher of the Georgia regulations and giving it the right to license that content to other publishers. But Fastcase maintains that the regulations are public law in the public domain and that Casemaker cannot claim an exclusive right to their publication.

Initially, Casemaker said it would not fight the lawsuit and agreed that state law should not be subject to copyright. But it subsequently filed an answer and counterclaim in which it asserted “the right to claim copyright in any copyrightable materials, electronic files, data, source code and/or anything in addition to the statutory text and numbering in the content of the site(s).”

Then came Fastcase’s motion for summary judgment. It argued that there is no genuine dispute as to any material fact and that the court should enter a judgment declaring that Casemaker has no copyright in the Georgia regulations and that Fastcase is therefore not infringing any copyright by publishing those regulations on its own site.

For more detail on all of what previously transpired, see these posts:

Now on to the latest news.

Staking Out Their Legal Arguments

After Casemaker filed its initial answer and counterclaim, it then filed an amended answer. The amended answer is interesting in two respects:

  • The amended answer adds this statement: “Defendant does not intend to commence, institute and/or file any litigation regarding any use of the Electronic Files by Plaintiff prior to April 7, 2016.” Recall that Casemaker’s initial take-down notice said that if Fastcase did not comply, Casemaker would take whatever steps it deemed necessary, “which may include litigation.” So now Casemaker is affirmatively stating that it will not commence litigation against Fastcase, at least with respect to past use of the materials.
  • The amended answer drops all counterclaims against Fastcase. The original answer included counterclaims for unjust enrichment and quantum meruit.

Then, on June 9, Casemaker filed its response to Fastcase’s summary judgment motion. The response builds on the amended answer and argues that Fastcase’s motion should be denied for four reasons:

  1. The court lacks subject matter jurisdiction because Casemaker has not registered a copyright in any of the files or data at issue in the case. For that reason, the complaint presents no federal question under copyright law. Further, there is no diversity jurisdiction because the amount in controversy does not exceed $75,000.
  2. The case no longer presents a justiciable case or controversy because Casemaker has dismissed its counterclaims and has given Fastcase a covenant not to sue with respect to any demands and claims that Casemaker could have made based on the conduct at issue. As a result, under the voluntary-cessation doctrine, Fastcase’s claims are moot.
  3. As to Fastcase’s claim for declaratory judgment related to its copying of materials prior to April 7, summary judgment should be denied based on disputes as to material fact, as well as the need for discovery as to certain material facts.
  4. As to any aspect of Fastcase’s claim based on activities occurring after April 7, Fastcase has pleaded no facts supporting such a claim. On that date, Casemaker altered the Website to require users to agree to express terms of use. If Fastcase were allowed to amend its complaint to state a claim based on the period after April 7, Casemaker would respond with a claim for breach of contract that would not be preempted by the Copyright Act, along with a claim for copyright infringement, depending on whether Fastcase copied any Casemaker materials.

On Tuesday, Fastcase filed its reply to Casemaker’s response. Its memorandum made the following arguments:

  1. The court does have federal question jurisdiction because Casemaker continues to threaten to sue Fastcase for copyright infringement if it updates the Georgia regulations from the Georgia Secretary of State website.
  2. The court has diversity jurisdiction based on the fact that Fastcase is a citizen of Delaware and the District of Columbia while Casemaker is a citizen of Virginia. Further, the amount in controversy is greater than $75,000 because Fastcase updates its materials daily and Casemaker’s new terms and conditions say that each violation would cause Casemaker to “suffer damages of at least $20,000.”
  3. There is a justiciable controversy despite Casemaker’s promise not to sue for anything that happened prior to April 7. The controversy exists because Casemaker continues to insist it could sue Fastcase at any time going forward. The only difference would be Casemaker’s legal theory.
  4. There are no disputes of material fact and Fastcase is therefore entitled to summary judgment.

As of yesterday, the motion papers were submitted to U.S. District Judge Timothy C. Batten Sr. for his review and decision. As of today, that is where the case stands. As always, stay tuned for further developments.

Key Pleadings in the Case

In case you’re interested, here are the key pleadings so far in the case:

Legal research company Fastcase yesterday filed a motion asking for summary judgment in its lawsuit against rival Casemaker over copyright in Georgia  state regulations.

The motion alleges that there is no genuine dispute as to any material fact and asks the U.S. District Court in Atlanta to enter a judgment declaring that Casemaker has no copyright in the Georgia regulations and that Fastcase is therefore not infringing any copyright by publishing those regulations on its own site.

Here are the documents that were filed yesterday:

Fastcase filed the lawsuit in federal court in Atlanta after Casemaker served it a written notice demanding that Fastcase take down from its research collection the Georgia Administrative Rules and Regulations.

Casemaker’s parent company, Lawriter, has an agreement with the Georgia Secretary of State designating it as the exclusive publisher of the Georgia Rules and Regulations and giving it the right to license that content to other publishers.

Fastcase maintains that the regulations are public law published under statutory mandate and are therefore in the public domain, meaning that Casemaker cannot claim an exclusive right to their publication.

Casemaker initially said it would not fight the lawsuit and agreed that state law should not be subject to copyright. But it subsequently filed an answer and counterclaim in which it asserted “the right to claim copyright in any copyrightable materials, electronic files, data, source code and/or anything in addition to the statutory text and numbering in the content of the site(s).”

Prior coverage: