Last year, in the continuing federal court litigation between now-shuttered legal research startup ROSS Intelligence and long-established legal research giant Thomson Reuters, ROSS upped the ante when it filed a counterclaim asserting that TR is violating federal antitrust law by maintaining monopolistic and anticompetitive control over the legal research market.

Today, in a partial win for ROSS, the judge presiding over the case issued a memorandum opinion denying TR’s motion to dismiss a key aspect of that antitrust claim — 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.

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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.

Although a tying arrangement requires two separate products, TR argued in its motion to dismiss that ROSS has not proven the existence of two products.

But ROSS countered that the databases TR maintains of public law and its legal search tools are, in fact, separate products, and that TR conditions access to the databases on purchase of the search tools.

Judge Leonard P. Stark — who previously presided over the case as a U.S. district judge in Delaware but who last month became a judge of the Court of Appeals for the Federal Circuit — sided with ROSS. He noted that TR’s collection of public law “was effectively sold as a stand-alone product in the form of books for decades before modern technology allowed Plaintiffs to develop an online legal search tool.”

“Taking ROSS’s allegations as true, and drawing all reasonable inferences in ROSS’s favor, ROSS has sufficiently alleged that public law databases and legal search tools may be two different products instead of one,” Judge Stark held.

The judge also let stand a ROSS counterclaim under Section 1 of the Sherman Act, which prohibits “every contract … or conspiracy, in restraint of trade or commerce.” This claim is based on essentially the same theory as ROSS’s tying claim, the judge ruled, and so should continue for the same reasons.

However, the judge did not accept a second antitrust theory asserted by ROSS — that TR had engaged in anticompetitive conduct by pursuing sham litigation.

To prove this theory, the judge said, ROSS would have to show both a lawsuit that is “objectively baseless in the sense that no reasonable litigant could realistically expect success on the merits” and that the plaintiffs brought the lawsuit with a subjective motivation to weaponize the litigation process for an anticompetitive purpose.

But Judge Stark concluded, “ROSS has failed to plausibly allege that Plaintiffs have engaged in sham litigation.” Although ROSS’s counterclaim made unspecified allegations that TR had engaged in baseless litigation, the judge said, it did not provide “even one example.”

As to whether TR’s lawsuit against ROSS was, itself, sham litigation, Judge Stark concluded it was not.

“ROSS has not made any specific allegations about how the instant case is a sham,” he wrote. “Instead, after outlining its vague and conclusory allegations about Plaintiffs’ ‘long history’ of sham litigation, ROSS simply states that ‘[t]his is exactly what happened to ROSS.'”

Meanwhile, discovery appears to be continuing apace in the case, with both parties having issued a slew of document requests, interrogatories and deposition subpoenas.

TR filed its lawsuit in May 2020, alleging that ROSS stole content from Westlaw to build its own competing legal research product. ROSS did this, TR alleged, by “intentionally and knowingly” inducing the legal research and writing company LegalEase Solutions to use its Westlaw account to deliver Westlaw data to ROSS en masse.

The lawsuit forced ROSS to decide to shut down its operations, which it did effective Jan. 31, 2021. But ROSS vowed at the time to continue fighting the lawsuit, which it characterized as a bullying tactic by TR to shut down a potential rival, and it has held true to that vow up to now. 

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.