A federal judge in Delaware has dismissed the claim by now-shuttered legal research startup ROSS Intelligence that Thomson Reuters violated federal antitrust law by unlawfully tying its search tool to its public law database in order to maintain its dominance in the overall market for legal search platforms.
The ruling brings an end to ROSS’s counterclaims against Thomson Reuters (TR) in the continuing federal court litigation between the two parties. Still to be decided in the case are TR’s claims that ROSS violated its copyrights by unlawfully copying TR’s legal materials in order to use them to train its own AI-driven legal research platform.
Those claims were scheduled to have gone to trial last month, but the trial was continued at the eleventh hour, leaving the copyright issues yet to be decided.
After TR first brought its copyright lawsuit against ROSS in May 2020, ROSS filed a counterclaim asserting that TR was violating federal antitrust law by maintaining monopolistic and anticompetitive control over the legal research market.
In 2022, Judge Leonard P. Stark — who previously presided over the case as a U.S. district judge in Delaware before becoming a judge of the Court of Appeals for the Federal Circuit– dismissed a portion of ROSS’s antitrust claims, but he allowed the tying claim to move forward.
That claim alleged that TR violated Section 2 of the Sherman Antitrust Act by unlawfully tying its search tool to its public law database in order to maintain its dominance in the overall market for legal search platforms.
See all my stories about this lawsuit.
Tying occurs when a seller exploits its control of a product to condition the sale of that product on the buyer’s promise to also purchase a different product.
But that earlier ruling came before the parties had been able to flesh out the evidence in the case through discovery and depositions and was based on ROSS’s allegations in its counterclaim.
No Proof of Tying
In the ruling issued Friday, the judge who replaced Judge Stark in the case, 3rd U.S. Circuit Court of Appeals Judge Stephanos Bibas, sitting by designation in the U.S. District Court in Delaware, granted TR’s motion for summary judgment on the tying claim, concluding that ROSS had failed to back up its allegations with sufficient evidence.
ROSS’s theory was that the Westlaw caselaw database is a standalone product that many consumers want to buy, but that TR will sell it only when it is packaged with Westlaw’s search tools, which ROSS alleged was a separate product.
“In other words, Ross claims that Thomson Reuters forces people to buy its Westlaw search tools if they want to use its caselaw database,” Judge Bibas explained.
To establish an unlawful tying arrangement, Judge Bibas said, ROSS would have to show that the products are, in fact, separate, and then would have to define the relevant market for those products in order to show an improper use of power in that market.
ROSS failed to establish either of these facts, Judge Bibas ruled.
On the issue of separate products, ROSS failed to show that there is sufficient consumer demand in the market to purchase these products separately, insofar as it failed to show that consumers had in fact bought the products separately, had wanted to buy the products separately, or would have wanted to buy the products separately had TR not intimidated them from doing so.
A key to ROSS’s argument was that the case law TR now sells online was once sold in books, as a product separate and distinct from Westlaw’s search tools. That proved that the caselaw database was a separate product, ROSS asserted.
But the judge concluded that the analogy to books suffered from two flaws.
“First, Ross is wrong that books were sold without search tools,” Judge Bibas wrote. “True, books were sold without Westlaw’s current technological capacity. But if we can analogize online legal databases to printed legal databases, we can also analogize online search tools to printed search tools: tables of contents, indices, and page numbers. So its database was not sold unbundled from search tools.”
Second, Judge Bibas continued, “the evolution from book search tools (say, a table of contents) to Westlaw’s digital search tools (say, Boolean search terms) is like how the horse-drawn carriage market evolved into the car market. Just as we no longer use horse-drawn carriages for transportation (except for fun), few consumers want caselaw separated from the sophisticated search tools that make it digestible. A market for public law in book form used to exist, but that does not mean that a market for separate caselaw still exists in a world with more sophisticated search tools.”
The opinion goes on to discuss – and dismiss – other arguments ROSS raised to establish its tying argument, but the bottom line is that the judge found insufficient evidence to establish any of them.
Even if ROSS had established tying, the judge said that its claim would still fail because it had failed to establish evidence that would define the market that would be harmed by any tying arrangement.
ROSS attempted to do that, the judge said, through the opinion of an expert witness, James Ratliff, an economist who specializes in antitrust matters. But the judge said that Ratliff’s expert opinion devoted only a few paragraphs to this issue and was so lacking that it failed to meet the standards for the admissibility of an expert opinion under under Federal Rule of Evidence 702 and Daubert v. Merrell Dow Pharms., Inc., 509 U.S. 579, 592–93 (1993).
“Dr. Ratliff essentially has no methodology for defining the relevant markets,” Judge Bibas said. “He includes no math or economic modeling. He never analyzes potential competitors in any depth. All he does is make brief, conclusory assertions. That is not enough.”