AMERICAN ASSOCIATION OF LEGAL PUBLISHERS 282 North Washington Street Falls Church, Virginia 22046-4518 Eleanor J. Lewis Executive Director Arthur H. Rosenfeld Of Counsel Voice: (301) 652-3453 Fax: (301) 652-2970 E-mail: elewis@tax.org March 14, 1997 Appellate Court and Circuit Administration Division ATTN: ABA CITATION RESOLUTION Suite 4-512 Administrative Office of The U.S. Courts Washington, DC 20544 Dear Judge Forrester and Other Members of the Technology and Automation Committee of the Judicial Conference: The American Association of Legal Publishers (AALP) is a trade association of small legal publishers and developers of software used in electronic legal research materials. AALP members publish a wide variety of materials in print, CD and online covering specific courts or specific topics. A copy of AALP's statement of principles is attached as Exhibit 1. AALP members are unanimously in favor of the ABA-endorsed new citation format and strongly urge this Committee to recommend its use in all federal courts as soon as possible. However, we are against any requirement for any parallel citations to any West-created citation. We believe the use of the new citation format is appropriate for many reasons which we will discuss briefly in this letter and which we hope to be permitted to expand upon at the Committee's hearing on April 3. WHY A CITATION MONOPOLY EXISTS AND WHY IT MUST END First and foremost, AALP believes the judiciary in a precedent- based legal system has two responsibilities -- (1) to decide cases and controversies brought before it and (2) to disseminate its decisions concerning those matters. The federal courts do a good job of deciding cases brought before it, but they have totally abdicated their responsibility for disseminating their decisions. They have relied on the private sector to disseminate federal court decisions and permitted a single company to obtain monopoly control over the public's access to federal judicial opinions and to own the court- required citations. This company, West Publishing, was purchased in 1996 for $3.4 billion by Thomson Publishing, a Canadian company traded on the Toronto and London stock exchanges. Thomson is most interested in preserving West's monopoly to maximize its profits and satisfy its stockholders. In the current global communications world where the Internet makes everything instantaneously available worldwide, owning the only complete electronic database of all federal judicial opinions and controlling the creation and dissemination of the citations required by all federal courts is a very valuable asset. Court opinions and the power to create permanent citations for new decisions is too valuable an asset to be controlled by one foreign corporation, especially when it is obvious that this corporation is more interested in maintaining its monopoly than using the latest technology to improve its processes, such as making permanent citations immediately available or using paragraph numbers for pinpoint citations. Thus, the federal courts' long reliance on the private sector for disseminating its opinions must end. The judiciary must assume its rightful responsibility for disseminating its opinions. And the judiciary is fortunate, because given current technology, the assumption of these responsibilities will be much easier, faster and less costly than heretofore possible. Further, the states courts of Louisiana, South Dakota and Maine are already using immediately available permanent citations and can provide this Committee and the federal judiciary with useful information and technical assistance based on their experience. Michael Greenwood of the Administrative Office of the U.S. Courts delivered a speech at the July 1995 annual meeting of the American Association of Law Libraries in which he reported that during the decade ending in 1994-1995, the federal judiciary spent over one billion dollars on automation and technology. As of spring 1995, the federal courts owned 30,000 computers for 28,000 employees and had over 1200 employees working on technology-related issues. Unfortunately, practically no money or staff time was devoted to developing a uniform citation to be a permanent part of each decision released. In his speech Mr. Greenwood also stated that fees collected by PACER were accumulating faster than projected, so the PACER charges might be reduced. More about these fees appears on page 6 of this letter in the section concerned with financing a new citation format. All users of federal research materials are held hostage to the citation monopoly. And the monopoly has behaved as a monopolist when pricing its products. For example, West charged $33.30 in January 1995 for volume 859 of Federal Supplement; in January 1996 they charged $36.45 for volume 894; a price increase of 9.5 percent. In January 1997 West/Thomson charged $40.61 for volume 939; an increase of 11.4 percent over the 1996 price. Yet overall inflation during this time was about 3 percent. During these same years Louisiana and South Dakota started using a uniform citation issued by their courts. As a result prices for case reporters on CD decreased by over 50 percent. The federal government is probably West/Thomson's single largest customer in this country. The federal government has also paid the monopolist's prices for its purchases, although it frequently gets a special reduced price because the current commercial rates would bankrupt an agency. Attached hereto as Exhibit 2 are results of a study I did concerning the federal judiciary's spending on lawbooks. It shows that the cost of these materials was increasing several times faster than the inflation rate during Fiscal Years 1993 to 1996. With the new citation format, the resulting price and product competition will benefit the federal judiciary and the entire federal government. They too will spend less on their research materials. IMMEDIATELY AVAILABLE PERMANENT CITATIONS The single most important aspect of the new citation format is that it provides an immediately available permanent case citation and pinpoint citations for each opinion released by a court. These citations are official, permanent and unchanging regardless of which publisher is reproducing the case and in which format it is presented -- print, CD or online. It currently is easier to find the text of an opinion than to find its permanent citation because opinions are increasingly available from a variety of sources, including but not limited to the federal courts' PACER and HERMES Programs, Internet sites run by various law schools, circuit and district court-operated bulletin boards, and private vendors producing materials on CD or online or bulletin board access. However, of all these sources and many others unmentioned, only two publishers, Lexis and West/Thomson, ever offer the case with its permanent case and pinpoint citations. The creation of a permanent citation depends on West's deciding each case's page numbers in a book it is compiling. Thus, it takes weeks or even months for this information to be available. However, the opinion is almost instantaneously available to the entire world. To use the latest technology to create and release opinions but not citations for the opinions is illogical and bad public policy. The solution is not to slow the release of opinions, but to use technology to make the permanent citations part of each opinion when it is released. Even if the federal judiciary persuaded West to put its permanent citations and pinpoint citations in the public domain when they are eventually created, the result would be unacceptable because there still would be a major time delay between the release of the opinion and the permanent citations. To be useful to publishers at a cost consumers can afford, permanent citations must available when the case is released. That permits the publisher to create a timely product which contains all the information ever needed by the reader to find the case. If the permanent citation is released after the opinion, it either delays publication of the opinion or requires publishers to republish the opinion at a later time with the permanent citation. That is too costly and cumbersome. Consumers do not want to receive duplicate information; they just want to receive at one time everything they need concerning an opinion. PARAGRAPH NUMBERS FOR PINPOINT CITATIONS The use of paragraph numbers for pinpoint citations makes it easier for all readers of judicial opinions to find specific quotes. Using paragraph numbers will save judges and other court personnel time and effort. Instead of searching an entire page for a specific idea, they will be referred to the specific paragraphs in which it appears. Paragraph numbers are meaningful regardless of the medium in which the case is presented -- print, CD or online -- whereas page numbers are only meaningful in a print format. The Canadian federal courts have been numbering paragraphs in judicial opinions since 1992. Canadian provincial courts started doing this between 1992 and 1994. All report this is a task easily done by word processors using a macro. I understand the Canadian courts have sent this Committee their rules for inserting paragraph numbers. According to Jennifer Jordan, Registrar of The Law Courts of the Province of British Columbia, Thomson Publishing has been a leader in using paragraph numbers in its publications and worked cooperatively with the Canadian judiciary. I see no reason why Thomson should not be equally cooperative with the American judiciary. State courts in Louisiana have been inserting pinpoint cites by paragraph since 1994; South Dakota has been inserting paragraph numbers since 1996 and Maine and New Mexico started in 1997. All of these courts will share their rules and macros with the federal judiciary. The Chief Clerk of the New Mexico Supreme Court, Kathleen Jo Gibson, reports that court personnel in New Mexico were initially resistant to the change, but quickly learned how to use the macro and have been doing so since January 1, 1997. Tax Analysts, a tax law publisher and AALP member, started numbering all paragraphs in its publications in 1996 and reports its staff quickly learned to do this. Tax Analysts offers to share its macro and rules for paragraph numbering with this Committee and the federal judiciary. REQUIRING PARALLEL CITATIONS TO WEST REPORTERS I understand the West/Thomson wants this Committee to recommend that lawyers be required to use parallel cites -- even for pinpoint citations -- to the West citation. West/Thomson's motives are obvious and self-serving; they want to guarantee the sale of their products. And most importantly, such a requirement will further strengthen West/Thomson's monopoly, if that is possible, and render meaningless a decision by this Committee and the federal judiciary to adopt a new citation format. This will occur because West/Thomson will be the only publisher able to provide at not extra cost both citations in its products. It will obtain the new citation from the courts as all publishers will. It will add its own citations when they are available. However, all other publishers will be less fortunate, since West/Thomson claims a copyright over both its case citations and pinpoint cites. It permits other publishers to use the case citation as a "fair use" under the copyright laws. But it requires publishers to pay a license fee to include the pinpoint cites which are called star pagination. That is the exact position publishers are in today and why they do not obtain this information from West. This Committee will perpetuate the need for publishers to use licensed data from West if it requires parallel citations. Currently only Lexis has such a license. Federal District Judge Paul Friedman of the District of Columbia signed on March 7, 1997, the final judgment between West/Thomson and the U.S. Department of Justice's anti-trust division concerning Thomson's purchase of West. Included in this judgment are the license and the annual license fees West/Thomson may charge other publishers for star pagination. The relevant portion of this judgment is attached hereto as Exhibit 3. In all likelihood this judgment will be appealed by Hyperlaw, an AALP member. Each licensee must pay the fee each year they use the information and for each product in which they use it. If a publisher has two publications -- print and CD -- it will pay two fees per year for each opinion. Since lawyers are researchers need an archive of opinions, a publisher's licensing fees will increase as its archive grows and soon the licensing fees will consume a substantial portion of gross revenues. For this reason, small publishers cannot afford a license from West. Therefore, this Committee and the federal judiciary should not require any parallel citations. Requiring any parallel citations will also increase legal fees charged consumers and create extra work for lawyers who do not purchase West products. Large wealthy firms, the Fortune 500 of the legal profession, are the most consistent buyers of West's products, and requiring parallel cites will not bother them. But such a requirement will have a disproportionately adverse impact on all other lawyers and firms, and particularly on young or minority lawyers, on nonprofits, on smaller firms, on solo practitioners and on lawyers serving small businesses and the less wealthy members of our society. Almost all publishers charge less than West/Thomson does for a product. Lawyers not owning West products will have to have an employee travel to a law library or elsewhere to locate a West product and the needed citation, wasting valuable time and increasing the cost of representation. For a lawyer in a small town, remote location or far from other lawyers, this will be difficult to find during the work day and absolutely impossible to obtain at other times. Electronic communications make working in remote locations easier, but a parallel citation requirement will hurt lawyers making that choice. West/Thomson is misleading the judiciary when it claims that complete parallel citations are needed to provide courts with easy access to cases cited in a brief. When the uniform citation and its paragraph numbers are released by the court as part of an opinion, no publisher will exclude them. To do so would constitute altering an official part of the case. Legal publishers can only thrive by accurately reporting what a court releases. For example, in its regional reporters and other products, West has included all the new citations issued by Louisiana, Maine and South Dakota as well as all the pinpoint cites issued by each of these venues. Thus, every opinion reported in every publishers' products in any medium -- print or electronic -- will have the new citations. Regardless of which legal research product a federal judge and his staff uses when reading briefs, it will contain the new citations needed to locate an opinion. All publishers will include this information to make their product complete and useful to their clients. BUREAUCRATIC OBSTACLES TO CHANGE And last but not least, AALP urges this Committee not to be swayed by judiciary employees' complaints that a new citation system will create more work, complicate existing procedures and cost the courts lots of money. No one likes change, but we all adjust to it. The reality is that the new citation system will take an extra few minutes of work per opinion in the beginning, but that will decrease to a deminimus amount as employees gain experience. FINANCING THE CHANGE The change will involve some additional costs for the federal courts, but that cost pales in comparison to the cost the existing citation monopoly imposes on all consumers in America because of the absolute and total lack of price and product competition for federal judicial case reporters. And most importantly, the monies needed to install the new system can easily be found in the revenues received from the federal judiciary's operation of its PACER Program which is bringing in more monies than ever projected. Judiciary employees report there are substantial funds in these accounts. Since these are unappropriated funds not obtained from Congress, the Administrative Office of the Courts has fewer controls on how they are used. Instead of using them to purchase the newest computers with the most bells and whistles, they can be used to finance the new citation format. EFFECT ON PUBLISHERS The adoption of the ABA citation format will help small publishers flourish, but they will earn their profits by creating new products and providing value added materials, such as summaries and analysis and not by controlling access to citations. In fact, AALP members strongly support the ABA citation format because for the first time ALL OF THEM will have equal access to the permanent citations. For the first time they too will be able to produce federal case reporters with citations required by the courts. For the first time they too will be able to produce specialized case reporters focusing on cases of a specific circuit or a specific area of the law or both or any other combination they may create. For the first time there will be meaningful price and product competition for legal research materials concerning the federal courts. For all of these reasons, AALP urges the Committee to recommend the new citation format without the use of any parallel citations and to take all actions necessary to insure that the U.S. Judicial Conference adopts the recommendation and institutes the new citation format. AALP respectfully requests the opportunity to testify at the April 3, 1997 hearing on this matter. AALP members will testify in detail about implementing this proposal, a cost-benefit analysis of its impact, the effect it will have on specific products and how it will help lawyers and other consumers. Because several people will be testifying, we would appreciate being allotted at least 30 minutes for our presentation. Sincerely, Eleanor J. Lewis EXHIBIT 1 STATEMENT OF PRINCIPLES 1. Our legal system depends on prompt, unrestricted publication and dissemination of the law. 2. The members of the American Association of Legal Publishers have joined together to support the common interests of legal publishers to promote and encourage publication and dissemination of the primary sources of the law upon which our legal system depends, as well as publication and dissemination of information and guidance about the law. 3. Publication and dissemination of the law should not favor one medium (such as print) over another (such as electronic). 4. The judicial opinions, statutes, regulations, and administrative rulings of the United States, and each of its states and subdivisions, are the property of the public. Notices relating to such documents, and all amendments to such documents, are also the property of the public. 5. All judicial opinions, statutes, regulations, and administrative rulings, and all notices and amendments relating thereto, should be made easily available to all, on an equal basis, by the originating court, legislature, or agency, with only such charges as are necessary to defray the actual costs of dissemination. STEPS TO CARRY OUT THE PRINCIPLES 1. Judicial opinions, statutes, regulations, and administrative rulings should identified by means of a vendor-neutral, public-domain citation system. 2. The official version of a judicial opinion, statute, regulation, or administrative ruling should be the version first released to the public by enrolling clerks and similar judicial and administrative officers, either in print or electronically. Changes should thereafter be made only by means of written orders filed with the same office as the original opinion, statute, regulation, or ruling. 3. Courts and other agencies should number the paragraphs in the opinions, ruling, and similar legal documents that they issue, in accordance with an agreed set of rules, so as to facilitate pinpoint references to those opinions, rulings, and similar documents. EXHIBIT 2 FEDERAL JUDICIARY'S SPENDING ON LAWBOOKS Re: Cost of Lawbooks Purchased by Judiciary and other Government Agencies Each March the Federal Judiciary submits to Congress its budget request for the next fiscal year. The request is prepared by the Administrative Office of the U.S. Courts and covers all federal courts, offices and agencies which are part of the Judiciary. The specific entities covered by each submission are: U.S. Supreme Court; U.S. Court of Appeals for the Federal Circuit; U.S. Court of International Trade; Federal Circuit, District, and Bankruptcy Courts and Magistrate Services; Federal Defender Services; Administrative Office of the U.S. Courts; Federal Judicial Center; and U.S. Sentencing Commission. These budget requests contain the following facts: FY 1996 Request: 10-11% inflation rate for lawbooks and their continuations 3% inflation for almost everything else purchased by Judiciary $4.7 million additional requested for purchasing lawbooks total budgeted for purchasing lawbooks is over $35.5 million FY 1995 Request: 10-13% inflation rate for lawbooks and their continuations 2.6% inflation for almost everything else purchased by Judiciary $2.7 million additional requested for purchasing lawbooks total budgeted for purchasing lawbooks is over $32.8 million FY 1994 Request: 9-10% inflation rate for lawbooks and their continuations 3.1% inflation for almost everything else purchased by Judiciary $2.8 million additional requested for purchasing lawbooks total budgeted for purchasing lawbooks is over $30.5 million FY 1993 Request: 10% inflation rate for lawbooks and their continuations 3.7-4% inflation for almost everything else purchased by Judiciary $3.3 million additional requested for purchasing lawbooks total budgeted for purchasing lawbooks is over $24.2 million THE DIFFERENCE BETWEEN ANNUAL PRICE INCREASES OF 3% AND 10% IS THE COST OF HAVING A LEGAL CITATION MONOPOLY WHICH ELIMINATES ANY PRICE OR PRODUCT COMPETITION FOR LAWBOOKS. EVERY federal agency, office and commission buying lawbooks and their continuation parts pay these excessive prices annually. EXHIBIT 3 E. Defendants shall take no action that would jeopardize the sale of the Divestiture Products. IX. STAR PAGINATION A. Beginning no later than ten (10) business days after the entry of the Final Judgment, defendants shall grant to any third party a license in the form attached as Exhibit B to star paginate to West's National Reporter System publications subject to license fees not to exceed the price indicated below per format per year per 1,000 Characters (as defined in Exhibit B) contained in the material being star paginated: First year of license: $0.04 Second year of license: $0.04 Third year of license: $0.06 Fourth year of license: $0.06 Fifth year of license: $0.08 Sixth year of license: $0.08 Seventh and later years of license: $0.09 The license fees may increase at a rate based upon, but not to exceed, the change in the United States Department of Labor Producer Price Index for Finished Goods. B. Any existing star pagination licensee may elect to modify its existing license on star pagination by substituting the terms and conditions of the license contained in Exhibit B on 120 days' notice.