Court Says PACER System Is Illegally Using Fees

Nearly two years ago, we wrote about an important lawsuit concerning PACER -- the electronic records system of the federal court system in the US. As we've pointed out many, many times over the years, the whole PACER system is a complete scam by the federal courts. Beyond the clunky and vintage 1998 interface, it is insanely expensive. It technically charges 10 cents per "page" but it determines "pages" liberally. Do a search? That'll cost you 10 cents. View a docket in a long case? With no warning, that could add $3 to your bill (there is an upper limit of $3 per document). Want to read a filing that's more than 30 pages? $3. For each one. The only thing that's actually free are opinions -- but even just getting to them could cost you some money as you do the search and load the docket, etc. And I won't get into the convoluted system it takes to sign up for a PACER account (at least when I did it, you had to wait for them to mail you stuff through the physical mail -- though they may have since updated it).

This is ridiculous for a system that should be open to the public. Case law is a part of the law. The public should have free access to it to understand the law. But it's been made incredibly difficult by this system. On top of that, as we pointed out almost a decade ago, it's also against the law. Under the law that set up PACER, Title 28, the courts are only allowed to charge as much as is necessary to pay for the system (realistically, this should come out of filing fees, rather than user fees, but... that's another issue for another day). And, by all accounts, the PACER system was generating a huge profit for the court system -- from 2010 through 2016, PACER brought in $920 million for the courts. Yes, nearly a billion dollars. Admittedly, the US courts say that they've spent that money in other potentially useful ways -- including upgrading computer systems in court rooms and such. But if Congress wants them to spend money that way, they should say so -- rather than have the courts flat out ignore the law (irony!) and overcharge PACER users.

Of course it took until 2016 for the first serious challenge to this practice to be filed, and on Saturday (yes, Saturday), Judge Ellen Huvelle ruled for the plaintiffs, saying that the US Court system was abusing the PACER funds it received. It was not a complete victory, but still an important step in the right direction. As the court notes, the issue comes down to interpretation of the law that enables PACER, and the court actually rejects both sides' interpretation:

Plaintiffs take the position that the statute "prohibits theAO from charging more in PACER fees than is necessary to recoup the total marginal cost ofoperating PACER." ... Under plaintiffs' interpretation, defendant's liability isestablished because with the exception of the category of expenditures labeled Public AccessServices... most, if not all, of the other expenditures covered by PACER feesare not part of the "'marginal cost of disseminating records' through PACER."... Defendantreadily admits that PACER fees are being used to cover expenses that are not part of the"marginal cost" of operating PACER ... but it rejects plaintiffs' interpretation of the statute. Instead, defendant reads the statutebroadly to mean that the Judicial Conference "may charge [PACER] fees in order to fund thedissemination of information through electronic means."... Under defendant's interpretation, it is notliable because "every single expenditure . . . [is] tied to disseminating information throughelectronic means."

If the Court agreed with either proposed interpretation, the ultimate question ofdefendant's liability would be relatively straightforward. If PACER fees can only be spent tocover the "marginal cost" of operating PACER, defendant is liable most expenditures. IfPACER fees can be spent on any expenditure that involves "the dissemination of informationthrough electronic means," defendant is not liable. But the Court rejects the parties' polaropposite views of the statute, and finds the defendant liable for certain costs that post-date thepassage of the E-Government Act, even though these expenses involve dissemination ofinformation via the Internet.

I won't go through the full reasoning, but basically the language of the statute is unclear (good ol' Congress!) and both sides present what the court determines to be strained readings to reach their own interpretations. So the court comes up with its own interpretation of the law -- and finds that under its interpretation, some of the funds were misspent:

Having rejected the parties' diametrically opposed interpretations, the Court must embarkon its own analysis to determine whether defendant's use of PACER fees between 2010 and2016 violated the E-Government Act. The Court concludes that defendant properly usedPACER fees to pay for CM/ECF and EBN, but should not have used PACER fees to pay forthe State of Mississippi Study, VCCA, Web-Juror, and most of the expenditures for Courtroom Technology.

Again, without going too deep into the weeds (though, feel free to read the whole ruling below), the court notes that the law says that PACER fees must be used in ways that "provides the public with 'access to information available through automatic data processing equipment.'" That is more than just PACER, but... does not cover all those other things the federal courts were spending it on. And as the judge notes, while providing jurors with technology is nice, it does not appear to be covered by the law:

From the existing record, it would appear that the only courtroom technologyexpenditure that might be a permissible use of EPA fees is the "digital audio equipment" thatallows digital audio recordings to be made during court proceedings and then made part of theelectronic docket accessible through PACER.... But, the Court does not see how flat-screen TVs for jurors or those seated in thecourtroom, which are used to display exhibits or other evidence during a court proceeding, fallwithin the statute as they do not provide the public with access to electronic informationmaintained and stored by the federal courts on its CM/ECF docketing system.

This is a win, though I imagine it's not the final word on the matter as there may still be appeals. The case is a class action, and this could mean that the court system will have to cough up a lot of money to all of us who use PACER regularly. Meanwhile, Stephen Schultze, who has been talking about this issue for a while notes that the judge's interpretation (agreeing with neither the plaintiff nor the defendant) has its own problems:

Judge Huvelle is a good and fair judge. She rejected the reasoning of both the plaintiffs and the defendants (the Judiciary). Instead, she substituted her own analysis. Unfortunately, her analysis was both legally and technically flawed. Under her ruling, PACER fee-payers will not recover another $750 million (or so) of fees that I think are unlawful.

Schultze post then goes into great details on why the Judge was too broad in her reading of the statute, and how the judicial system could still be abusing its powers here. It's a worthwhile read.