Existing Legal Protections
Even while they lobby for legislation to extend their rights, the big three use an effective mix of existing protections to guard their data and their market share. Most prominently, they use the trifecta of intellectual property rights: copyright, patent and trademark. Among the big three, Thomson has been the most aggressive in using current law. As noted in Appendix C, Thomson has registered over 48,000 trademarks for works and serials. In comparison, Reed Elsevier and Wolters Kluwer combined have registered just over 5,300 trademarks. Appendix B lists patents that Thomson and Reed Elsevier hold; each has attempted to protect the methods they have developed that allow lawyers to quickly find relevant information in their vast databases. Completing the trio of intellectual property rights, the big three publishers all use trademark protection extensively to protect their brands. It is perhaps in Appendix A’s listing of trademarks that the average reader can appreciate the extent to which these three companies so completely dominate the legal publishing market. Nearly all the information a lawyer might need in the normal course of law school and as a practitioner can be found within the big three’s product catalogs.
In addition to using traditional intellectual property rights, the big three employ “click wrap” contracts to lock up their data. For example, to gain access to westlaw.com all users must agree not to “reverse engineer, decompile, disassemble or otherwise attempt to discern the source code of the components of westlaw.com[.]” This portion of the agreement should be unnecessary if Thomson patented the eligible portions of its site, preventing competitors from replicating westlaw.com’s value added services until the patents expire. In addition to protecting the information architecture and searching tools that make Westlaw so valuable, the User Agreement goes on to prohibit a user from permanently storing any of the information downloaded from westlaw.com: “User may store temporarily insubstantial amounts of Downloaded Data.” This effectively prohibits a user from using westlaw.com to compile a database of case law, even though the text of each downloaded decision is not copyrightable. Again, it would seem unnecessary for Thomson to have included this provision, as its 48,000 registered copyrights must include all copyrightable material on westlaw.com. The User Agreement attempts to lock up all the data Thomson has compiled, whether it did so creatively or by the sweat of its brow. Thomson’s ability to force users to agree to contracts limiting their rights beyond what lawmakers intended should not be underestimated, especially in light of publishers asking for additional protections.
To gain and keep market share both Reed Elsevier’s LexisNexis and Thomson’s westlaw.com use loyalty programs, issuing points to users much like airlines’ frequent flyer miles. These loyalty programs are designed to attract law students who, as students, receive both LexisNexis and Westlaw for “free.” Law students are oblivious to the real world expense of the services they are using; they are often ignorant of other more cost-effective or free options (limited as they are) and often become “hooked” on these very convenient and effective tools. These programs are designed to make law students more likely to pay for them as practitioners.
The big three have been very effective at using existing law and savvy marketing to create demand for their service while making sure there are no competitors benefiting from their hard work and ingenuity. The existing palette of protections has been more than adequate for the big three to make a hefty profit and, after a review of the success they have had in protecting their data and their profitability, it seems unnecessary to add any more legislative or regulatory barriers to a market already dominated by three large players.
As the market has shown, raw information does not need to be legally protected so long as the interface for retrieving it is significantly more convenient than the free alternatives, and the information is highly reliable and “complete.” This added ease of use and guaranteed reliability provided as a wrapper around the facts themselves drive attorneys to pay a high price for the law even when there are less expensive means of obtaining it.
Even after unfavorable court decisions (Bender and Hyperlaw) that opened the market to free riders, Thomson, Reed Elsevier, and Wolters Kluwer have remained dominant and continued to expand. The reaction to the decision in Bender was very favorable. Librarians expected the price of obtaining legal information to fall. But it has not, perhaps because there is very little competition from independent publishers. In purchasing or providing private, free sources of law and also in reliably gathering a “complete” history of the law in a single place, Thomson, Reed Elsevier, and Wolters Kluwer have captured the legal publishing market in a way that ensures their continued success, regardless of the Bender and Hyperlaw decisions. Because of their business practices and the nature of the industry they serve, these companies are not vulnerable to competition from the free riders they seek to protect themselves from by gaining legal protection for their databases as a whole. While not having this protection may cost the big three occasionally, they have established a pattern of buying any significant competitor that threatens their grip on the industry. As such, the “market” is working as it was intended. The existence of three main legal publishers ensures that there will continue to be innovation as they compete with each other for market share. So far no lower-cost provider has been able to make available a close enough subset of services to force the big three to lower their prices. Given the current state of the legal publishing industry, it would be absurd to further limit any avenues of outside competition in what is, and has for over a century been, a tremendously profitable cartel for the dominant players.
Selected Patents Assigned to Thomson Publishing, Reed Elsevier and their subsidiaries (note: no patents were found assigned to Wolters Kluwer or its subsidiaries):
Viveca Novak and Michael Weisskopf, The Cheerful Giver: A Businessman with a Corner on Publishing Court Documents Was Also a Master of Political Donations, TIME, April 21, 1997, available at http://www.cnn.com/ALLPOLITICS/1997/04/14/time/novak.html.
Opensecrets.org, supra note 101.
Follow the Money: The Institute of Money in State Politics, at http://www.followthemoney.org/database/StateGlance/contributor.phtml?si=200223&d=2515509 (last visited August 29, 2004).
See infra, Appendix C.
See infra, Appendix B.
See infra, Appendix A.
Westlaw User Agreement for Law School Students, at http://lawschool.westlaw.com/pdf/law school student user agree.pdf (last visited September 5, 2004).
Students receive points for logging onto the services and for completing training programs designed to showcase the value-added features unique to each service. The points are redeemable for a variety of products, such as travel and electronics.
Law students receive unlimited-use subscriptions to LexisNexis and Westlaw, paid for by their law schools, but presumably included in the cost of tuition. These unlimited accounts are only available for academic use and while the student is taking classes or doing other school-related work.
For an analysis of how to engineer an effective loyalty program see generally Brian Wansink and Scott Seed, Making Brand Loyalty Programs Succeed, 8:3 JOURNAL OF BRAND MANAGEMENT 211 (February 2001).
Our legal information market is based on an elaborate fiction—significant numbers of decisions are “unpublished,” which merely means an editor at West (or whomever the publisher of the reporter is in any given jurisdiction) decided that it wasn’t worthy of being published. These decisions are valid case law but nonetheless many courts will not accept a citation to an “unpublished” opinion. As such, a “complete” database of case law contains not every decision from a court, but only those which are “published.”
Higgins, supra note 62.
Svengalis presentation, supra note 14.
by Jason Gelman