We recently caught up with Fastcase CEO Ed Walters, who told us one of the best founding stories we’ve heard in a long time. It’s 1999, a lawyer and rocket scientist meet in the copy room of a high-power Washington, D.C. law firm at one o’clock in the morning, chaos ensues.
Hudson Hollister
Ed Walters, founder and CEO of Fastcase, thank you so much for spending some time with us.
Ed Walters
Pleasure to be with you, Hudson.
Hudson Hollister
I would love for you to start with the story of Fastcase.
Ed Walters
Sure, the year is 1999. If you can imagine this, the world of legal information has been consolidated into two gigantic foreign-owned publishing conglomerates. American companies who had done this historically, who had invented legal research, in some sense, have been acquired by an Anglo-Dutch publishing company and a Canadian publishing company who had built a business around mere access to law. You could search the law on their platforms, but it was $500 an hour or $100 search — highly expensive for really meager access.
Hudson Hollister
I became a student rep for one of those companies in law school in 2003 and I remember some of that dynamic. It was a duopoly, wasn’t it?
Ed Walters
It was a duopoly, and not a very good one. They’re good companies, they were pioneers, but they had sort of gotten fat and happy. The state-of-the-art of search, at the time, was moving in the direction of this new company called Google. Mere access was a great business model.
Think of AOL, where just getting you onto the internet was something that they could charge you $20 a month for, and they could be the front page of the internet, and they could consolidate in a weird way. The Internet, of course, was much more decentralized. It really resisted that. So the idea of mere access didn’t seem very vulnerable in 1999, but it was, of course.
At that time, I was a lawyer in a big Washington law firm, Covington & Burling, and a Fortune Five client of the firm — a software company that specializes in making PC operating systems — came to me and said, “Hey, we’ve got a question. The answer is in case law, but it’s too new to be in the books. Go do online research to find us an answer to this question. But don’t use [one of the commercial services].”
Hudson Hollister
What else was there?
Ed Walters
Nothing! I said, “What’s your hang up with those services?” That’s what we used at our firm to do online research. It can’t be money, right? This company’s biggest legal problem in 1999 was, “What do we do with all this money?” They were one of the wealthiest companies in the world. And they said, “No, it is money, actually.” Because they had like 300 outside law firms working for them, and they all did their research on [those commercial services], so they were paying tens of millions of dollars for the subscriptions of the law firms.
“We don’t do that anymore,” they said, “we don’t pay to put the books on your shelf, we’re not gonna pay to put them on your computer either. I don’t care how you do it, but go find something else.”
So I’m a young law firm associate. I’m an internet optimist. And I figured, well, that’s fine. I’ll just go use whatever the next big service is, right, there must be something. So I spent like four hours trying to find whatever the big alternative to the incumbents in the space, and I couldn’t find it. So finally, it’s one o’clock in the morning and I break down …
Hudson Hollister
So you used one of the commercial services? Does your firm then eat the cost? I guess I’m still hung up on that client deal?
Ed Walters
Yeah. It cost thousands of dollars and took 45 minutes to do, when it should have taken about five minutes. And that’s because at the time, and you may remember this from your [student rep] days, when you run a search in this era of legal research, the results come back with the highest court first, most recent case to the oldest case, then the next highest court, most recent case to the oldest case.
There was no concept of relevance. There was no way to filter the results.
The guidance at the time was if you get a lot of results, then you should continue to narrow your search by excluding a bunch of stuff. Add a bunch of search terms so that your results get to be a short enough list that you can read every case in the list.
Hudson Hollister
No prioritization, just mechanical.
Ed Walters
Yeah, bonkers, right? A terrible idea that was state-of-the-art 1999.
So I’m getting ready to give this research to the client. It’s going to have [a logo] on every page of the print out. I’m furious and It’s one o’clock in the morning. And I should say, I was never at the firm at one o’clock in the morning! I was a beer and softball league lawyer, the person whose job it was to take out summer associates and convince them you can have a work life balance.
So it’s one o’clock in the morning and I’m punching the printer in our office suite and my next door neighbor at the firm comes in. He was always there at one o’clock in the morning — he was a workhorse, a very good law firm associate. But he says, “Ed, what are you doing here and why are you punching our printer?”
And I said, “You know this is stupid, right? We pay taxpayer dollars to get the law. We pay judges, law clerks, legislators and staff, council, and agency regulators to get the law. Then we give it away to these duopolists who sell it back to us.” That is crazy!
In a web-enabled world, in a decentralized world, you have to imagine that there would be a public domain alternative, but there’s not. There’s got to be a way to get public law more readily available to more people. And I’ve got half a mind to go start the thing that I was looking for that night. The next door neighbor at the firm, Phil Rosenthal, ended up being my co-founder at Fastcase. That night he said, “That’s a really interesting idea. Hey, by the way, I can’t remember if I told you, but I have a PhD in physics from Caltech.”
The word genius gets used a lot. But there are no definitions of the word genius that don’t include Phil. Phil taught physics with Stephen Hawking at Caltech. He did a PhD at Caltech in four years. Phil worked on the first prototypes for the New Horizons Pluto fast flyby project — an actual rocket scientist at JPL.
Hudson Hollister
And … then he became a lawyer?
Ed Walters
Then he went to Harvard Law School and graduated top of his class.
Hudson Hollister
Why?!
Ed Walters
It’s interesting, the reason he went to law school was he wanted to be an entrepreneur, and I’m very grateful that he did because that brought us together on that fateful night.
So we spent like, six months of nights and weekends, building the prototype of Fastcase. And in the process, inventing the ability to sort search results, the ability to rank by relevance, the ability to do inline citation analysis, the data visualization of search results with result maps. It was a very productive six months. And then we left very good law firm jobs, to go start this alternative to the duopoly of legal information in the US.
The idea was to democratize the law and to make research smarter. To really apply the state of the art in other disciplines to legal research. But more importantly, to make sure that people have meaningful access to the law, which really, nobody did in 1999.
Parenthetically, November of 1999, if you want to put a pin on a timeline of the worst month in American history to start a software company, it’s probably then. A terrible, terrible time to start a company. The dot com 1.0 economy exploded about a few months after we left the firm. I think smarter people would have stopped the enterprise at that point.
But we also knew that it was a pretty good idea, making the law highly accessible at free or low prices. Then you can add all kinds of structure and useful stuff on top of it that you can charge more for if you want to, but the mere access that had been so expensive in the past for public domain law should be commoditized and we believed that we could commoditize it.
The insight that made Fastcase work was not even ours. This company Casemaker pioneered this idea that you could work with state bar associations, and the state bar would pay you a certain amount of money. And then you would make that state’s law available for free to the lawyers in that state.
Hudson Hollister
Is it right to say that the partnerships with state bar association’s that Fastcase began to close, those partnerships were what allowed Fastcase in its early years to go up against the duopoly for legal information?
Ed Walters
That’s right. It was state bar associations that really made Fastcase work. We innovated on the Casemaker model by saying that, instead of getting just one state, you get all 50 states. And so Casemaker had signed up about 22 states into this consortium, they had the law libraries of 22 states. All of the states that didn’t have Casemaker, basically subscribed to Fastcase, because we were offering all 50 states and then slowly over time, states began to migrate from the Casemaker service on to Fastcase, until you know, culminating in 2020, when those two services combined. And now, lawyers in all 50 states have access to Fastcase for free through the bar association — more than 1.1 million lawyers get access for free.
Hudson Hollister
I’d love to ask you a bit about the notion of Data First drafting for law, but in order to get there, I would like to first ask you about the Fastcase / Casemaker business today. What are some of the hallmarks of the growth in an industry that now is definitely no longer a duopoly?
Ed Walters
I would say that we’ve done a pretty good job of commoditizing mere access to law. We have made lots of case law datasets public, working with public.resource.org and others. We have a mobile app, the Fastcase app for iOS and Android that’s free, and anyone can get free access to statutes and cases through those mobile apps. And we have worked to make those datasets that we use in Fastcase, more commoditized by making them available to other companies. So Rabbah law and case text and Ross intelligence all use feeds from Fastcase, to start the research services. A very strong commercial attitude about this would say, “no competition, make everyone find the data themselves.” But the idea was to commoditize the law, was to make sure there was more access and more competition. And so for all of these years, we have made a feed of those raw data streams available to clients and competitors and others.
One thing that’s cool right now is that we’re making these feeds available also to law firms, and to corporate legal departments, and to banks, who are able to take the raw data and build their own applications. And they’re building this whole new generation of data-driven legal services that go beyond the traditional documents, and our model of law firm products. And these new legal services are more quantitative, they are less transactional, they tend to be things like subscription products that people are offering, using Fastcase data.
One of the things I’m most excited about is that we move kind of in our collection beyond the end products of data and into dockets, for example, which I’m really excited about. But every docket tells this really interesting story. A docket is a map. And it tells you what steps people took along a journey through the legal services system. And individual docket changes are not super interesting. But we have now aggregated hundreds of millions of them in state and federal court. The data set is something like 520 million documents, which is docket sheets and the briefs and motions and pleadings and everything else. But now, for the first time, you can really do big data analysis of what happens in litigation, you can do empirical legal studies, you can figure out quantitatively what’s likely to happen in a certain case, and what strategically you should do going forward.
Hudson Hollister
Now I want to talk a little bit about data-first structuring for law and regulation. Tell me a bit about Fastcase’s current work in the area of digital structure, especially on the state level.
Ed Walters
Yeah. After we merged with Casemaker, in December of 2020, we’ve been working to collect all of the state statutes, the acts that lead into state statutes, regulations and registers, and to put them in a common language and have a common updating schema for them. We’re also working with the team at Judicata, who joined us in September of 2020, to put it into a markup language, it’s called LDML, the Legal Data Markup Language, that puts them all into a common vocabulary.
I’m sure it’s been done by the largest legal publishers in the world in the past, but behind closed doors, right. It’s like the Coca Cola recipe or something. But this is public law. And structuring public law shouldn’t be some big mystery. And so the idea is that working together with very smart teams, Judicata, and Casemaker and Fastcase, we can collect all of that law, represented as data, not as a PDF, not as an image, not as a Word document, but as structured data, and then have all of them represented in the same data schema, so that you can cross compare really, for the first time in an intelligent way. So that you can create machine readable, intelligible feeds of legislative or regulatory activity, across all 50 states. Not just, you know, here’s a list of everything that happens in all the states and a bunch of different formats. But here’s a feed of a very specific question you asked, and all of the data that relates to it. And that should be both human intelligible, but also machine-readable. And the hope is that will power Fastcase in the future, but will power lots of other applications in the future, as well.
Hudson Hollister
You’ve mentioned the different users building tools on top of Fastcase feeds. What are a couple of examples of the kinds of tools that could be built with a 50 state standardized legislative and regulatory regulatory materials dataset?
Ed Walters
There’s a great example of this. From Eversheds Sutherland, one of the biggest global law firms. They had a lot of in-house expertise around spoliation, the destruction of evidence and litigation, and there’s all kinds of law about this kind of procedure in litigation. But they had an in-house team that knew a lot about it. And so they worked with Fastcase data, and a Fastcase tool called AI sandbox that basically used that expertise, to train a machine learning model. And to look at Fastcase’s data, and to look at the data updates that happen every day, in order to find new spoliation cases. And they have created a tool called Spoliation Scientists. They recently won a global award as the innovative law firm of the year because of the Spoliation Scientist tool. And that’s a subscription tool, that’s something that their clients can subscribe to, that is not reliant on how many hours that associate spends or the document they produce at the end. This is a data tool created by a law firm for the benefit of clients, powered by Fastcase data.
Hudson Hollister
Once you’ve got the whole dataset machine-readable and consistent across all of the states, what are some of the higher order things that might not be possible now, but will be possible for those that have to comply with legislation, regulation, or both?
Ed Walters
I would love to kill 50-state surveys. So once we understand what the law is about, instead of doing research in 50 states and trying to find, you know, where in the outline in the code, that particular provision is, let’s call it you know, the tax of sales over the internet. Every state has its own law about this. In order to find out what that is and what your obligation is, you would have to go do research in all 50 states and have us code and figure out what the tax law is. I think in the future when you represent it as data, you can really understand this from a data perspective. We don’t really care where it occurs in the outline or the taxonomy of state laws. We just know this is the sales tax code of all 50 states represented as data and you know, intelligible, understandable by corporate legal departments and law firms in a brand new way.
That’s the glorious future. That’s one of the very practical effects of having law is data.
Hudson Hollister
Thank you for that glorious future. As a lawyer, I am excited about the death of the 50 state survey and all interminable interminable projects. Ed, thank you so much for the work that you and Fastcase you’re doing.
Ed Walters
Thanks Hudson.
