“I’m energized by the fight ahead,” declared Ross Intelligence co-founder and CEO Andrew Arruda in a mid-December Twitter thread. “Whatever ROSS rises to be in the future, I think our first phase of growth & the lawsuit that put our operations on pause will be remembered as the exposition and rising action of our narrative arc.” 

Arruda was commenting on a fraught legal battle playing out in a Delaware court between the small Toronto-founded startup and multinational Canadian media conglomerate Thomson Reuters. The seven-month-long feud has already claimed Ross as a casualty. The AI-powered legal-research startup, founded in 2015, announced in mid-December that it would cease operations come January 31, citing mounting legal costs and the lawsuit making it impossible to raise new funding. 

However, the company has vehemently denied the allegations of copyright infringement Thomson Reuters and its online database subsidiary Westlaw made in a lawsuit filed in May, and followed news of its closure by filing a counterclaim. 

The startup’s legal woes have imperiled a six-year quest by Arruda and his co-founders Jimoh Ovbiagele and Pargles Dall’Oglio to use AI to make legal research more accessible to the average person. 

One Ross investor, who declined to be identified because the matter is in front of the courts, said the story of Ross also reflects the never-ending battle between “incumbents with capital and emerging tech companies.”

According to Arruda, the idea to create Ross, an AI-powered legal assistant, was rooted in the belief that if legal research could be sped up and accessed in plain English, it would significantly reduce the steep costs people and businesses face when dealing with the justice system.

“We believe that if we could bring the power of artificial intelligence to the law, our dream of justice not operating differently depending on your socioeconomic status could become a reality,” he proclaimed in a November 2016 IBM-sponsored TED Talk in San Francisco. It was during this speech that Arruda vowed to make Ross’s services freely available to legal-aid lawyers across North America, a declaration that was met with strong applause. 

Shortly after, the startup, which had set up offices in San Francisco and Toronto, received its biggest round of funding: a $13-million Series A led by Inovia Capital, with participation from Comcast Ventures Catalyst Fund, Y Combinator, Real Ventures, Dentons’ Nextlaw Ventures and undisclosed angel investors. The round came barely a year after a US$2.1-million seed raise led by Inovia. 

Since then, the company has raised little. Data from PitchBook shows that its final round of venture funding for an undisclosed amount came from Nimble Ventures, UpHonest Capital and others on May 31, 2019. 

Less than a year later, Ross was hit with the lawsuit, at the heart of which are serious allegations of copyright infringement. 

The saga effectively began in January 2018, when Westlaw terminated a service agreement it had with a company called LegalEase, a Michigan-based provider of legal-support services, and sued it for breach of contract, subpoenaing Ross in the process. Westlaw suspected that LegalEase had been mining information from Westlaw’s database and sending that proprietary content to Ross. 

In May 2020, Thomson Reuters and Westlaw filed a lawsuit against Ross, alleging it stole “critical features” of Westlaw without permission or compensation, and used then-Westlaw licensee LegalEase to “rush out” a competing product so as to not spend the “resources, creative energy, and time” to come up with the product on its own. Additionally, the companies alleged that Ross “illicitly and surreptitiously” coerced LegalEase to gain access to Westlaw content, accusing it of “tortious interference of contract.” 

“The net result is that Plaintiffs are now being put in the unfair position of having to compete with a product that they unknowingly helped create,” the May lawsuit states. 

In its suit, Thomson Reuters claimed that because its Westlaw database includes proprietary “editorial enhancements,” Ross infringed upon its copyright, accusing it of copying its content and using it to create its own platform. Those Westlaw features include its West Key Number System (WKNS), which indexes cases according to topics and legal issues at hand, and West Headnotes, which provide summaries of issues in cases, and are written by Westlaw’s editors. 

“Cases, areas of law, legal topics, legal issues, subtopics, and subissues can all be summarized and organized in a variety of different ways—the structure, sequence, and organization of the WKNS is not something that has been achieved by accident or necessity; rather, it is the result of decades of human creativity and choices,” they state in court documents. 

Thomson Reuters also alleged that Ross used LegalEase to access and copy its Westlaw database, because Westlaw had denied Ross direct access to the platform, as it was developing a competing product. 

A back-and-forth between the parties then ensued. In response to the suit, Ross filed a motion in July to dismiss it altogether. It claimed Westlaw’s business model was based on “the improper control and monetization of key public legal texts on which our democracy is based.” The startup called Westlaw’s Headnotes and WKNS a “roundabout method to attempt to copyright those public texts through headnotes and a key number system.”

“ROSS’s model threatens Plaintiffs’ monopoly over access to public legal texts,” Ross said in its motion. 

“Obviously threatened, Plaintiffs have moved aggressively to destroy ROSS before it gains further traction. Further illustrative of this anticompetitive purpose, Plaintiffs reveal in their Complaint that their standard license prohibits anyone who merely reads public legal text on Westlaw from competing with Westlaw. This is not just wrong; it is dangerous.” 

Ross also said Thomson Reuters and Westlaw’s copyright-infringement claim was essentially baseless because the startup’s bot was specifically designed not to lift or copy third-party information like Westlaw’s Headnotes, but instead to obtain public legal opinions to convert them into “natural language.”

Ross was subsequently met with an answering brief by Thomson Reuters in opposition to the dismissal, in which the company accused Ross of mis-describing the case as being about owning the law, even though the suit was focused on Ross’s alleged “copying of the Plaintiffs’ creative expression in Westlaw.” In December, Ross partially withdrew its motion, and filed a counterclaim against the portion of the initial suit that alleged tortious interference with regards to the accusation that Ross had LegalEase steal content from Westlaw on its behalf. 

The startup admitted it was denied from using Westlaw, and that it did contract LegalEase to conduct legal research that Ross could use to train its AI search algorithm. But it claimed that it in fact did not have knowledge of which research software or service LegalEase would use, and that it did not instruct it to use a specific service. It also said it instructed LegalEase not to breach any third-party contracts it had. “ROSS directed LegalEase to provide researcher-chosen quotes of case law directly from raw judicial opinions in certain legal areas, based on questions from bankruptcy and intellectual property law,” its counterclaim states. 

Days into 2021, Thomson Reuters issued a response to Ross’ counterclaim reiterating its allegations against the startup. The company also requested that the judge deny Ross all relief requested in its counterclaims, and dismiss Ross’s counterclaims with prejudice. 

In November, a judge presiding over the case appeared to question the notion posited by Thomson Reuters and Westlaw that Ross had intentionally sought to acquire Westlaw’s content, according to the blog LawSites, which has followed the case closely. 

“Why shouldn’t I understand what you are telling me to be: ‘Hey, we’re just completely speculating here that the defendant actually used some of our protected material?’” Judge Leonard P. Stark asked Thomson Reuters attorney Dale Cendali of Kirkland & Ellis. “‘We really don’t know; we just suspect they could not have developed their product so quickly if they didn’t. But, you know, let us get to discovery and then we’ll find out if our suspicions are correct.’” 

The question of whether Ross intended to specifically access Westlaw’s content to somehow use it to better inform the construction of its own AI software remains unanswered. Thomson Reuters, Westlaw and their lawyers did not respond to requests for comment. Ross’s lawyers, too, did not respond. 

“[Thomson Reuters] have the power to crush because of the cash they have, and in this specific case, yes, it scared investors away. But Ross has an amazing tech platform and they paved the way for legaltech. Sadly, they are not going to be the one that profits from it,” said the investor whom The Logic agreed not to name. 

One of Ross’s earliest investors, Nextlaw Ventures—which participated in the October 2017 US$8.7-million raise—declined The Logic’s request for comment due to “recent litigation,” but said Ross was one of the “pioneers” in the field of legaltech.

And while Arruda declined an interview request, he referred The Logic to his Twitter profile for commentary on the case itself. 

“From our inception, ROSS had a singular mission: to democratize legal research. We have never wavered from that mission. This is just the next step on that journey,” tweeted Arruda on December 14 as part of a thread explaining the decision to file a counterclaim. “We’re still writing our legacy here at ROSS and will keep fighting for every #legaltech startup, those gone, those operating, & those yet to launch.”