Category Archives: Law Firm News & Views

Who is Marc Kasowitz?

Numerous sources, including Reuters and the Washington Post, are reporting that President Trump has retained trusted longtime counsel Marc Kasowitz to help with the Russia probe despite Kasowitz having no substantial criminal law experience. So who is he?

According to his profile on the Kasowitz Benson Torres LLP website, Kasowitz has been “[d]escribed by CNBC as the ‘toughest lawyer on Wall Street’ and by Bloomberg Financial News as an ‘uberlitigator.'” From the profile:

Marc regularly serves as national trial counsel in complex litigation in the areas of bank finance, fraudulent conveyance, RICO, corporate governance, antitrust, securities, mass tort, product liability, environmental, breach of contract, and other commercial cases.  Marc also has an extensive and successful track record in dealing with investigations and lawsuits by state attorneys general, including path-breaking settlements of tobacco litigation.  Marc has also conducted numerous internal investigations on behalf of boards of directors, management and special committees regarding alleged corporate misfeasance, conflicts of interest, challenges to board authority, insider trading, accounting fraud, market timing, obstruction of justice, market manipulation, and other issues relating to director and officer fiduciary responsibilities and liabilities.

In Marc E. Kasowitz: 5 Fast Facts You Need to Know, we learn

  1. He Has Represented Donald Trump For Over 15 Years
  2. He Wrote a Letter Demanding The New York Times Retract Its Story About Donald Trump’s Alleged Groping Incidents
  3. Another One of His Clients Is the Largest Bank in Russia
  4. His Former Partner Is Now the U.S. Ambassador to Israel
  5. He Has Compared the O’Reilly Scandal to McCarthyism

Regarding the O’Reilly scandal, the article notes that Kasowitz represented Bill O’Reilly during the Fox News host’s legal trouble surrounding alleged sexual harassment in the workplace. See also, ATL’s What’s Going On At Kasowitz Benson? — Joe

Glass half full: An optimistic perspective on the future of the legal profession

“The laws of supply and demand have finally caught up with the modern U.S. legal profession, yet the lawyers that preside over the decaying hierarchy – law professors, BigLaw partners, bar associations, and state and federal judges – are substantially in denial. Why? Because the old order has been too good for too long, blinding its beneficiaries to the core ideals that make a life in the law worth living. But there is good news—those now entering the legal industry will have an opportunity to return to those ideals, albeit this renaissance is borne more out of necessity rather virtue. … This is the core storyline of Ben Barton’s thoughtful and comprehensive new book, [Glass Half Full: The Decline and Rebirth of the Legal Profession (Oxford UP, 2015)]” writes William Henderson in Law and Politics Book Review.

From the book’s blurb:

It would be easy to look at these enormous challenges and see only a bleak future, but Ben Barton instead sees cause for optimism. Taking the long view, from the legal Wild West of the mid-nineteenth century to the post-lawyer bubble society of the future, he offers a close analysis of the legal market to predict how lawyerly creativity and entrepreneurialism can save the profession. In every seemingly negative development, there is an upside. The trend towards depressed wages and computerized legal work is good for middle class consumers who have not been able to afford a lawyer for years. The surfeit of law school students will correct itself as the law becomes a less attractive and lucrative profession. As Big Law shrinks, so will the pernicious influence of billable hours, which incentivize lawyers to spend as long as possible on every task, rather than seeking efficiency and economy. Lawyers will devote their time to work that is much more challenging and meaningful. None of this will happen without serious upheaval, but all of it will ultimately restore the health of the faltering profession. … A unique contribution to our understanding of the legal crisis, the unconventional wisdom of Glass Half Full gives cause for hope in what appears to be a hopeless situation.

Recommended. — Joe

Algorithmic performance of legal tasks will save time but time-savings will be less significant than popular accounts suggest

The title of this post is one of the main conclusions Dana Remus and Frank Levy reach in Can Robots Be Lawyers? Computers, Lawyers, and the Practice of Law. Here’s the abstract:

We assess frequently-advanced arguments that automation will soon replace much of the work currently performed by lawyers. Our assessment addresses three core weaknesses in the existing literature: (i) a failure to engage with technical details to appreciate the capacities and limits of existing and emerging software; (ii) an absence of data on how lawyers divide their time among various tasks, only some of which can be automated; and (iii) inadequate consideration of whether algorithmic performance of a task conforms to the values, ideals and challenges of the legal profession.

Combining a detailed technical analysis with a unique data set on time allocation in large law firms, we estimate that automation has an impact on the demand for lawyers’ time that while measureable, is far less significant than popular accounts suggest. We then argue that the existing literature’s narrow focus on employment effects should be broadened to include the many ways in which computers are changing (as opposed to replacing) the work of lawyers. We show that the relevant evaluative and normative inquiries must begin with the ways in which computers perform various lawyering tasks differently than humans. These differences inform the desirability of automating various aspects of legal practice, while also shedding light on the core values of legal professionalism.

Recommended. H/T to Jeffrey Brandt’s Growing AI Redux post. — Joe

Whittier Law School plans to shutdown; law faculty seek TRO

The New York Times is reporting that Whittier Law School is planning to shut its doors. The school has not set a date but announced that it will not admit 1Ls this fall. Whittier is the first fully accredited school to announce plans to close. For more, see Elizabeth Olson’s DealBook post. See also Whittier Law School may close, as trustees announce no new students (National Jurist) which notes that Whittier’s enrollment has dropped from 700 in 2010 to less than 450. During the same time period, its median LSAT has dropped from 152 to 146. Its bar passage rate has dropped to 38.1 percent for the class of 2015, the most recent data available. It was as high as 69 percent in 2012. Inside Higher Ed reports that some law school faculty members have sued to block the school from closing. The faculty members claim that Whittier College is seeking to profit from a sale of the land on which the law school is located. Here’s their TRO brief. — Joe

BigLaw firm fired for “enabling Trump” by representing him

In what may be a first, blow back in the form a scathing “you’re fired” letter to a BigLaw firm by an investment firm for the firm performing work for the Trump family business and the president’s legal duties and ethical obligations has resulted in the firing of the law firm. Here’s the letter from H. Scott Wallace of Wallace Global Fund to its former counsel Morgan Lewis. Pay particular attention to the “Already, the ethical carnage has begin” section of the letter.

The last paragraph before the former client signed off says it all: “Americans deserve a President of undivided loyalty. Your firm has denied them that. We cannot be complicit.”

What was some of the work Morgan Lewis performed for Trump? See Morgan Lewis Joins Trump’s Reich, Shills For Toothless Interpretation Of Emoluments Clause. — Joe

Is this going to be a trend? BigLaw firm libraries reporting to firm’s chief marketing officer

I hope not. See BNA’s Scott Mozarsky (President of Bloomberg Law and Bloomberg BNA’s Legal Division) ATL post, Large Law’s Not-So-Secret Weapon In Marketing And BD: The Library. (Observing that he only knows of four of the 50 largest firms where the law library reports to the chief marketing officer.)  See also Greg Lambert’s response to Mozarsky’s post at Who Leads the Law Library? How About Law Librarians? — Joe

The big three legal research providers in the small law market

Lexis, Westlaw, and Fastcase are in a virtual tie in the small law market according to a recent survey conducted by the law practice management firm Clio. The results of the survey revealed the following small law market shares:

  1. Westlaw, 20.58 percent
  2. Fastcase, 20.35 percent
  3. LexisNexis, 20.21 percent

See the below pie chart and table for details.

Hat tip to Bob Ambrogi’ LawSites post. — Joe

 

Advice on how to respond to a Trump Twitter attack by Cleary Gottlieb

Cleary Gottlieb has issued a brief memo on how clients should respond to a social media attack. The memo clearly focuses on a Trump Twitter attack. “The advice,” writes Villanova law prof Louis J. Sirico, Jr. on Legal Skills Prof Blog, “is very lawyer-like—full or pros and cons, very thoughtful, very measured.” And very interesting. — Joe

Baker & Hostetler licenses ROSS Intelligence’s AI product for bankruptcy matters

In what is reported to be ROSS Intelligence’s first BigLaw client, Baker & Hostetler has licensed ROSS for use by its Bankruptcy, Restructuring and Creditors’ Rights team. Here’s the joint press release. — Joe

Top ten largest US law firms

According the Law360’s 400, here is the US headcount ranking:

  1. Jones Day
  2. Greenberg Traurig
  3. Morgan Lewis
  4. Sidley Austin
  5. Latham & Watkins
  6. Kirkland & Ellis
  7. Skadden
  8. DLA Piper
  9. Reed Smith
  10. K&L Gates

H/T to Joe Patrice’s ATL post, What’s The Biggest Law Firm In The Country? — Joe

Short Takes On The News: Public Defenders, Lawyer Ideology, and Faculty Pay

Short Takes on the News

The Governor of Maine is promoting legislation that would revise how representation for indigent criminal defendants is organized in that state.  Rather than organizing a public entity to perform the work, the State would contract with lawyers for individual cases.  The story in the Bangor Daily News doesn’t mention this directly, but this would likely save a cat box load of money that would go to government pensions for state employed Public Defenders otherwise.  I wonder if Maine would be willing to try this same approach with the Prosecutor’s Office.  Probably not.

Has anyone ever wondered about the political ideology of the legal academy?  I’d say the answer is no only because the bias anecdotally appears to be liberal.  Well, someone took the time and effort to measure that bias in multiple contexts.  A new paper called The Political Ideologies of the American Lawyer by Adam Bonica, Adam S. Chilton, and Maya Sen seems to confirm just where that bias lines up on a spectrum of left and right.  The legal profession collectively lines up somewhere center left close to where Bill Clinton would be (he’s a marker on the chart along with other well-known politicians).  Medical doctors and bankers tend to be more to the right.  Go figure.

Graduates of elite law schools tend to be more liberal:

The most striking result in Figure 6 is that all 14 top law schools have distributions that lean to the left. That is, there are more liberal alumni from those schools than there are conservative alumni. Not only do all of the schools lean to the left, the skew is fairly extreme in several of the schools. Perhaps unsurprisingly, the University of California, Berkeley has the most liberal leaning distribution of alumni of all the elite law schools. That said, although the ideology of Berkeley graduates skews the furthest to the left, it is obviously not the only school with a heavily left skewed distribution. In fact, all of the top six law schools—Yale, Harvard, Stanford, Columbia, Chicago, and NYU—have a relatively small number of graduates with conservative CFscores.

There’s a joke in there somewhere but I’m not the one who is going to make it.

There is an in depth write-up of the paper in Quartz.  It can be downloaded here.

Finally, the EEOC has investigated pay discrepancies between male and female faculty members at the University of Denver and wouldn’t you know it, there is a pay gap.  Moreover, it’s been going on for at least four decades.  The story is in the Chronicle of Higher Education and the Denver Post.  I guess liberality stops at the paymaster window, at least at UD.

Mark

What Do Legal Employers Want In Law School Graduates?

One of the many issues coursing through law schools these days is revising the curriculum to produce more practice-ready graduates.  This makes a school’s students more likely to be attractive to firms in that they would need less training on the job to be successful.  I attended a panel discussion several months back at the LexisNexis offices here in Chicago that featured librarians from large firms, small firms, and the federal courts.  The discussion centered on the expectations each of their respective organizations had for interns and new hires.

I found it pretty interesting as we in academics teach research from the perspective of skill and strategies without context.  We talk about being cost effective here in the law schools but sometimes I’m not sure our version of cost effective is the same as that as a firm or legal practice.  One would think that a firm would like to keep costs down as much as possible while at the same time getting the research right. That may be true generally, but the approaches the librarians discussed varied depending on the research topic and the available resources.  The point really is that a student/graduate versed in online legal research should ask how research is conducted at the firm in order to use learned research skills effectively.

One of the other things that came up in the discussion was security.  That’s something I admit I never really thought about.  I’m used to seeing email messages with the standard disclaimer to the effect “this communication is intended for ….”  Client privacy, after all, is an ethical issue.  Those same issues come up in research where graduates find that they are restricted in where and when research is conducted.  I’m sure firm librarians reading this will say “Yes, and?”  It may be a shock to students to learn that firms and courts lock down information with prohibitions against thumb drives containing confidential information and other electronic devices that do the same.  Remote access to a firm’s system is definitely not as casual as logging into a law library’s database list.  Or putting it another way, there is a big difference between what is possible and what a firm allows and how it allows it.

With all of that, there is a recent study funded by Lexis that measured some of the expectations of some 300 hundred hiring partners for so-called practice ready graduates.  Here is the executive summary with links to the full report:

Executive Summary

Law Schools and individual faculty are in the process of revising their curriculum and classes to address the demand for more practice-ready graduates. But what are the most desired research, writing and transactional skills and how can law schools develop these skills most effectively? An independent survey was conducted by 5 Square Research, Inc. and funded by LexisNexis®, to answer these questions and more.

The result is a new white paper, Hiring partners reveal new attorney readiness for real world practice, which shares the responses of 300 hiring partners and associates from small to large law firms practicing in litigation and transactional law.

Key findings include:

  • 96% believe that newly graduated law students lack practical skills related to litigation and transactional practice.
  • 66% deem writing and drafting skills highly important with emphasis on motions, briefs and pleadings
  • Newer attorneys spend 40% – 60% of their time conducting legal research
  • 88% of hiring partners think proficiency using “paid for” research services is highly important
  • Students lack advanced legal research skills in the areas of statutory law, regulations, legislation and more…
  • The most important transactional skills include business and financial concepts, due diligence, drafting contracts and more…
  • A law firm spends approximately $19,000 per year, on average, to train a new associate

This study reveals the most important and most lacking practical skills desired by legal employers and will help inform law schools of the specific content and tasks they can integrate into applicable classes and experiential learning programs pursuant to employer demand and the new ABA standards.

Read the full article with charts, Hiring partners reveal new attorney readiness for real world practice, or view this Executive Overview Prezi*.

*Chrome or Firefox is best for viewing Prezi

Mark

More On The New LexisAdvance Interface

There is a longer video from Lexis on the new LexisAdvance interface which reveals more detail about the interface.  There are obvious improvements compared to what currently exists.  I’m not convinced until trying it out.  My uncertainty has more to do with whether the functionality is conducive to work flow.  Lexis seems to think it is.  We’ll see.  As of this writing there are 423 views and no comments for the six minute video. The video is on YouTube here.  While we’re on the subject of videos, some may want to view this video concerning the LexisNexis Digital Library for Law Schools.  –Mark

Short Takes On The News: Justice Thomas, Big Law Money, Apple Appeal, and Firefox

Justice Thomas has made a few statements about race in the United States as reported in Salon and other sources yesterday.  Here are a few quotes:

“My sadness is that we are probably today more race and difference-conscious than I was in the 1960s when I went to school,” Thomas said. “To my knowledge, I was the first black kid in Savannah, Georgia, to go to a white school. Rarely did the issue of race come up.”

“Now, name a day it doesn’t come up,” he continued. “Differences in race, differences in sex, somebody doesn’t look at you right, somebody says something. Everybody is sensitive. If I had been as sensitive as that in the 1960s, I’d still be in Savannah.”

Here’s my favorite quote:

“The worst I have been treated was by northern liberal elites,” Thomas said. “The absolute worst I have ever been treated. The worst things that have been done to me, the worst things that have been said about me — by northern liberal elites, not by the people of Savannah, Georgia.”

Without further clarification, I would suggest that a good chunk of that criticism extends merely to the logic he uses in his opinions and their outcome.  That is fair game in my opinion, as it would be with any other Justice.  Justice Kennedy, for example, gets his share of criticism from religious organizations for his votes on same sex marriage and similar cases upholding privacy in sexual matters.  And don’t get me started on Justice Scalia!

The Atlantic is running an article called The Collapse of Big Law:  A Cautionary Tale for Big Med.  The article details how lawyers measure success in terms of money, not purely as a matter of greed, but in comparison to the competition.  Gone, apparently, are the days when doing something of value for society through law practice is a real metric.  The context of the article is the lack of jobs for recent law school graduates.  The rest of the article compares what’s happening in law to similar practices developing in the medical field.

I’ll give an anecdotal story about a law school application essay as related to me by the Admissions Director at one of the schools at which I have worked.  The Director told me that one student did not write an essay as such but drew a large dollar sign across the page.  I understand the applicant was admitted at least for being honest.  I have to believe there were other qualities that qualified the student for admission.  Anyone pulling that stunt today would be incredibly naive.  That shows how long ago I had that conversation.

Publishers Weekly reports that Apple lost its appeal at the Second Circuit on the limited issue of staying the order of Judge Denise Cote imposing the external compliance monitor on the company.  Apple has complained about Michael Bromwich, the appointee, being intrusive and expensive.  The article describes the Second Circuit’s order:

The court cited the government’s own statements that the monitor, Michael Bromwich, was “empowered to demand only documents relevant to his authorized responsibility” and to “interview Apple directors, officers, and employees” only on subjects relevant to his task. “We agree with that interpretation of the district court’s order,” the court held. “In addition, we take counsel’s statement as a formal representation that appellees also accept that interpretation.”

Oh well, better luck on the main appeal, or not, depending on one’s perspective.

Jonathan Band writes an interesting essay on the Future of Fair Use after Google Books in Project Disco.  That’s “Disco” as in disrupted competition.  Band wrote the amicus brief for the Library Copyright Alliance and was cited five times in Judge Chin’s decision.  The piece describes the ideas in the debate he had with Jon Baumgarten, former General Counsel of the Copyright Office.  I get the impression that the Authors Guild have an extremely limited view of fair use based on the exchange between the two.

And finally, ads in the Firefox browser?  ZDNet has the story. — Mark

A quick recap of the AmLaw 200 Law Firm Leadership Survey

On Dewey B Strategic, Jean O’Grady identifies what’s hot and what’s not based on the findings of this year’s AmLaw 200 Law Firm Leadership Survey. My personal favorite is “Succession planning:  Hot (making a succession plan) Not ( executing a succession plan).” Jean reports that “[a]lthough the majority of firms have a succession plan – 90% of firm leaders have been in place for more than 10 years, so succession is not happening.” For more, see AmLaw 200 Law Firm Leaders Survey: What’s Hot and What’s Not. — Joe

BigLaw firms just treading water

After Wells Fargo and Citibank released their studies of the financial performance of the AmLaw 200, Bloomberg Law’s Lee Pacchia interviewed law firm consultant Bruce MacEwen. On AMLaw Daily, see Wells Fargo: 2013’s Growth Continues at Anemic Pace and Citi: Firms’ Revenue Rose 2.7 Percent in Third Quarter (registration required for both stories).

More generally, see AmLaw Daily’s coverage of LegalView’s Legal Market Index report at Study: Demand for Legal Work Down 5 Percent This Year. Hat tip for this story to Brian Leiter’s Law School Reports post (screen capture below), now a member (again) of Blog Emperor Caron’s ROBOnanza. I’ve omitted the post’s link because I don’t recommend clicking on the “Download on Our Site, Full Version, Sign Up Free Trial” robo ad that was embedded in the post when I visited Brian Leiter’s Law School Reports. Why? Because download what from which site? what full version? free trial to what? — Joe

leiter law school reports ad

Progressing from the first mover to the early adopter phase of market penetration, Axiom as a disruptor of the professional legal services industry

Is Axiom the bellwether for disruption in the legal industry? Bill Henderson thinks the answer is “yes.” “Axiom … is on the brink of demonstrating the benefits of the first mover advantage in law,” he writes. Axiom progress can be measured as having moved to the early adopter phase of market penetration in the corporate legal department market sector, the same market BigLaw competes in.

Axiom and large law firms are definitely targeting and servicing the same clientele — Fortune 100 legal departments. The substance of their work is also very similar — sophisticated, complex legal work related to disputes, transactions, and compliance.  But in many cases, the solutions offered by Axiom are radically different.

Bill Henderson, Professor of Law and Director of the Center on the Global Legal Profession at Indiana Univ. School of Law – Bloomington, explains in detail why he thinks the times they are a-changing and why “[t]his is bound to have the beneficial, balancing effect on the rest of us” in this Legal Whiteboard post. Highly recommended. See also, Michael Bonasso and William E. Vita’s A profession on the verge of a paradigm shift? (The Metropolitan Corporate Counsel, Nov. 3, 2013).

Do keep “legal solutions” provided by our very expensive professional legal services vendors in mind should you read Bill’s post. See, for example, Managed legal services: the way of the future? by Will Ashenmacher, Social Media Marketer, Large and Medium Law, Thomson Reuters:

Given the large-scale changes that the legal industry has seen even in just the past five years, the next decade or so is likely to be a turbulent one. The role that nontraditional law businesses like Axiom take, or do not take, will be of particular interesting.

— Joe

Box for Legal expands its tools for providing secured content management and collaboration services

“In the past year, Box’s sales in the legal industry grew more than 150 percent as customers like Perkins Coie, Wilson Sonsini and Fowler White Boggs use Box to collaborate internally and externally, manage and share information, and access legal documents on mobile devices,” wrote Nitin Gupta at Box Adds New Partners to Help Law Firms be More Competitive. In addition to being selected as the newest member of the ABA Advantage Program, Box is partnering with Intapp to prove law firms with a bridge between their legacy document management systems, offering a new integration with Guidance Software’s EnCase eDiscovery product, and has added 22 new end user legal app partners to the Company’s content sharing platform for the follow services:

  • Practice and case management: Rocket Matter, Amicus Attorney, Fastcase, Lex Machina and DirectLaw
  • Timekeeping and billing: Chrometa, Bill4Time and SimpleLegal
  • Access to lawyers: Avvo, UpCounsel, Plain Legal, LawPal and LegalReach
  • Courtroom information management: TrialPad, Lora Courtroom, iJuror, LawPavilion and TrialDirector
  • Productivity: iClient, Legal Viewer, Doc Scan Pro and Parallels

Folks might want to check out Box to avoid becoming a captive client of our very large “legal solutions” vendors. See, for example, Bob Ambrogi’s ABAJ column, Thomson Reuters’ cloud platform Firm Central emphasizes integration—at a cost:

The biggest downside to Firm Central is that all this integration carries a price. Firm Central’s base monthly subscription is $35 per seat, which is cheaper than most of its competitors. But that does not include the optional eBillity, which adds another $25. For the other Thomson Reuters integrations—WestlawNext, Westlaw Form Builder and Drafting Assistant—each requires its own subscription.

Even more unfortunate, when you ask what it would cost to add these products, you are directed to a salesperson rather than given a direct answer. What separates Firm Central from the practice management pack is its integration with other Thomson Reuters products. Unfortunately, the only way to get those integrations is through extra subscriptions.

Hat tip to Fastcase Teams Up with Box:

As soon as the integration is complete, you’ll have an option to store your documents to Box and access them on any device or app implementing the secure Box technology. … [T]he possibilities for what you can do with the documents you save from Fastcase are limited only by how those partners implement this technology. At some point you may even be able to sync your case management system with the research you perform on Fastcase as a result of these partnerships.

At Box Furthers its Push into Legal with New Integrations, Bob Ambrogi identifies the end user legal app providers that offer integration with Box now –“DirectLaw, Chrometa, Bill4Time, Plain Legal, TrialPad, Lora Courtroom, iJuror, Law Pavilion Plus, iClient, Legal Viewer, Doc Scan Pro and Parallels. The rest will become available in the first quarter of 2014.”

— Joe

Milbank, Tweed sends all of the firm’s 4th year associates to Harvard Law and Harvard Business schools

From the YouTube video description:

David Wolfson, partner at Milbank, Tweed, Hadley & McCloy and chair of the firm’s professional development committee, talks with Bloomberg Law’s Lee Pacchia about the Milbank@Harvard program. The week-long course at Harvard Law School and Harvard Business School takes mid-level Milbank associates through a wide range of professional development courses.

Very interesting. Can’t wait for Thomas M. Cooley Law School to offer the same sort of program. — Joe

Sixth Circuit Rules In Favor of Lexis on Arbitration Clause

LexisNexis prevailed in a case from the Sixth Circuit that was released a few days ago.  The issue concerned whether the arbitration clause in a contract for access to LexisNexis databases allowed for class arbitration.  The ultimate answer to that question was no.  The underlying issue in the case that triggered the lawsuit and appeal had to do with the practice LexisNexis employed in its flat fee access plans to attorneys.  I’ll let the Court explain it:

        LexisNexis (a business division of Reed Elsevier) provides legal-research services, primarily on-line. In 2007, Craig Crockett and his former law firm—Dehart & Crockett, P.C.—subscribed to a LexisNexis Subscription Plan. The Plan allowed subscribers unlimited access to certain legal databases for a flat, monthly fee.  Subscribers could access other databases for an additional fee. According to Crockett, LexisNexis told subscribers that a warning sign—such as a dollar ($) sign—would display if the subscriber was about to use a database outside of the Plan.

Several years after signing up for the Plan, Crockett complained to LexisNexis that his firm was being charged additional fees without any warning that the firm was using a database outside the Plan. LexisNexis allegedly insisted on payment of the additional fees anyway.

Those of us in academics working with our subscriptions to Lexis and Westlaw are very familiar with either premium databases not appearing or alternatively messages stating the desired content is not part of the current subscription.  It makes me wonder, assuming the allegations are true, why Lexis can’t manage flat fee plans.  Of course, we’ll never know since the dispute is heading to arbitration.

Though the Court is not sympathetic to Mr. Crockett’s legal arguments concerning how the arbitration clause in the contract is read (precedent is against him), it does offer this cautionary advice to prospective commercial consumers:

Crockett’s remaining argument is that, if read not to permit classwide arbitration, the arbitration clause is unconscionable. The clause is indeed as one-sided as Crockett says: the clause favors LexisNexis at every turn, and as a practical matter makes it economically unfeasible for Crockett or any other customer to assert the individual claims that Crockett seeks to assert here. The clause provides that any arbitration of any dispute concerning LexisNexis’s charges must occur in Dayton, Ohio, where LexisNexis is headquartered. The customer must pay his own legal fees, even if the arbitrator concludes that LexisNexis’s charges were improper. And unlike many corporations that require arbitration of disputes with their customers, LexisNexis makes its customer split the tab for the arbitrator’s fee.

The idea that the arbitration agreement in this case reflects the intent of anyone but LexisNexis is the purest legal fiction. But all of these things—the one-sided nature of the arbitration clause, and its adhesive nature—were also present in American Express Co. v. Italian Colors Restaurant, 133 S. Ct. 2304 (2013). And there the Supreme Court held that, all of those concerns notwithstanding, the absence of a class-action right does not render an arbitration agreement unenforceable. Id. at 2309 (The solution to Crockett’s problem is likely a market solution; as the district court observed, Westlaw’s agreement with its customers lacks any arbitration clause, much less a clause of the sort at issue here.)      Under Italian Colors, therefore, the agreement here is not unconscionable.

The case is Elsevier, Inc. v. Crockett, et al. (6th Cir. 12-3574, November 5, 2013).  Copies of the opinion are here and here.  Hat tip to Michael Ginsborg for the links.  As Paul Harvey would say, now you know the rest of the story.

Mark