When last we left off in the federal court battle in which legal research giant Thomson Reuters is suing now-shuttered legal research startup ROSS Intelligence for copyright infringement, ROSS had filed a counterclaim alleging that TR is violating federal antitrust law by maintaining monopolistic and anticompetitive control over the legal research market.

Yesterday, TR responded to that counterclaim, filing a motion asking the court to dismiss ROSS’s counterclaim, asserting that it fails to state a claim under federal antitrust law because it is based on TR’s lawful refusal to do business with a competitor.

Full text of TR’s brief in support of its motion to dismiss.

“ROSS’s Counterclaims suffer from a fundamental failing: its own allegations, accepted as true for the purposes of this motion, do not state antitrust or unfair competition claims,” the motion argues. “The reason is simple: it is black-letter law that a company is not required to do business with a would-be competitor.

“Yet ROSS’s Counterclaims amount to the complaint that, when competing, it did not want to build its own ‘public law database’ from scratch and Plaintiffs would not license Westlaw to ROSS.”

Addressing another allegation of ROSS’s counterclaim, that TR engaged in a conspiracy to restrain trade in violation of federal securities law, TR says that allegation must fail because a conspiracy requires two or more entities. The only entities ROSS has named are TR and West Publishing — wholly owned subsidiaries of the same parent company.

“Two subsidiaries wholly owned by the same parent are legally incapable of conspiring with one another,” TR contends, citing a decision of the 3rd U.S. Circuit Court of Appeals.

TR’s motion is signed by attorneys Jack B. Blumenfeld and Michael J. Flynn, partners in the Wilmington, Del., firm Morris, Nichols, Arsht & Tunnell.

TR makes the argument that a company can hold monopoly power and charge monopoly prices without violating the Section 2 of the Sherman Act. To prove a violation, a plaintiff “must establish the defendant willfully acquired and maintained its monopoly power through ‘exclusionary conduct.'”

Yet the only exclusionary conduct ROSS alleged was TR’s refusal to sell or license its legal database, TR argues. “No matter how ROSS tries to spin it, the complaint is the same: ROSS wants to buy West’s ‘public law database’ to create a product to compete with Westlaw,” the brief says.

ROSS ‘Hit A Wall’

TR’s brief also restates its allegations of theft by ROSS, supporting its assertions with many statements taken out of ROSS’s answer filed in the lawsuit.

TR paints a picture of ROSS as a growing company in urgent need of case law to support its expansion and the demands of its customers. Although ROSS had obtained case law from the legal research companies Casemaker and Fastcase, it “hit a wall” around 2019 when customers began to express concern about whether its case law collection was “sufficiently comprehensive,” TR alleges.

“These customers ‘had confidence that Westlaw’s database would have the materials they needed through years of using the database’ and could not rely on a ‘new digital public law collection, pulled together by smaller and unknown companies,'” TR says. “So ROSS resorted to theft.”

TR says that after ROSS contracted with the legal research company LegalEase, LegalEase’s use of Westlaw “skyrocketed.”

“When West investigated the irregularity, it discovered that LegalEase’s Westlaw activity suggested LegalEase had used a bot to systematically work through the [West Key Number System] to download and store mass quantities of proprietary content,” TR’s brief asserts. “LegalEase reproduced and distributed the content to ROSS; ROSS used the content to build its competing service.”

ROSS has denied that it stole any content from TR and specifically that it copied or used any of the Westlaw headnotes or key number system. It has contended that it hired LegalEase to research and provide answers to specific legal questions that it would use to train its algorithm.

Reached for comment last night, ROSS cofounder and former CEO said: “We are still reading through Thomson Reuters’s pleadings and cannot comment at this time. This being said, regardless of their pleadings the facts remain the same: Thomson Reuters is misusing the judicial system to bully a competitor in order to maintain their control over the legal research software market. We continue to believe we have the stronger argument and do not foresee this motion changing that reality.”

Photo of Bob Ambrogi Bob Ambrogi

Bob is a lawyer, veteran legal journalist, and award-winning blogger and podcaster. In 2011, he was named to the inaugural Fastcase 50, honoring “the law’s smartest, most courageous innovators, techies, visionaries and leaders.” Earlier in his career, he was editor-in-chief of several legal publications, including The National Law Journal, and editorial director of ALM’s Litigation Services Division.