Law Librarian Blog

Kudo's to W&L's Caroline Osborne

We're a little late on this announcement, but Caroline Osborne was named Director of the Law Library at Washington & Lee School of Law back in September.  She was formerly the Research & Instruction Services Librarian at W&L before serving as the library's acting director. Congratulations, Caroline! (DCW)

Stealing From a Law Library is Bad

I usually enjoy reading posts on the Above The Law blog.  Friday's ATL post concerned the apprehension of an Ohio State law student who is allegedly stole 200 books over a period of time from the Mortiz Law Library and resold them through the Internet.  The student, a 2L, was caught in a sting operation after a Brazilian lawyer questioned the markings on the books identifying them as property of Moritz Law Library.  The student managed to make about $10,000 from his alleged thefts since January.

I suppose what bothered me about this post were statements such as: 

It seems to me that this kid is no better than the law school officials who are charging people enormous sums of money for an education of questionable value. There’s no way 200 law books are worth $10,000. This 2L has just been taking advantage of people who think legal education is worth more than it is.

Really?  Ever see a publisher's invoice for a reporter or an annual looseleaf subscription lately?  Ever wonder why West and others can get away with selling casebooks to law students at exceptionally high prices?  If anyone has an inflated view of the product for the money, then legal publishers have to be included in the law school education "scam."  The books are apparently worth the money even if the books were sold on the Internet at a "discount."  Oh, and while we're at it, news flash, online subscriptions are expensive as well. 

Then there is this comment:

Meanwhile, I think it’s a wonderful commentary on the state of legal education that 200 books can go missing from a law library and nobody notices.

I wouldn't necessarily take the idea that no one notices when books are missing.  Stopping a serial book thief is hard to do in a large library.  The fact that someone contacted the library and explained the circumstances gave the investigators a way to catch the culprit.  The idea of stealing from the library equating with the cost of law school is ridiculous.

I'll say it one more time.  Law School costs lots of money.  It may not be worth it to some people.  There are enough applicants out there despite the dire warning about debt and jobs.  Go figure.   If anyone out there can't handle law school, or its cost, please leave.  There is always someone to take your place.  Go figure on that one too.

Too bad about the wasted cash and effort from this person for what will likely be a wasted degree not that this person will ever finish.  There's no way Character and Fitness bodies will let this one slide without asking a few tough questions.  Too bad the student didn't steal a book on ethics.  He or she might have learned something, like stealing is bad, m'kay?  No one needs to go to law school to figure that one out. [MG]

TRI CEO Tom Glocer on 2010 3Q Financial Performance: "Boringly Positive" Trends; Just Plain Boring Cut-Back Print Spend & Wait-n-See WestlawNext Business as Usual in This Economy for Law Library Institutional Buyers

"Boringly positive" is quoted from this brief Oct. 28 2010 Financial Times article reporting on TRI's 2010 3Q financial report and presentation (free registration required). TR Legal's 3Q 2010 results:

Third-quarter revenues were up 3% from the prior-year period. Subscription revenues grew 8%, led by 14% growth in international revenues and 23% growth in FindLaw both helped by acquisitions. Non-subscription revenues declined 4% and print products declined 4% due to tightened customer budgets and some timing benefits compared to the third quarter of 2009. Print attrition has slowed substantially from the prior-year period and is nearing historical levels.

Source: Press Release

Which is to say continued declines in high-margin print products and non-subscription revenues are the drag on TR Legal's operating profits. For 2010 3Q, TR Legal's operating profit was $287 mil, down 6%, compared to 2009 3Q's $305 mil. TR Legal's profit margin for 2010 3Q was 30.4%, down from 33.3% for 2009 3Q.  TR Legal's operating profit declined contributed virtually all of TR Professional Division margin decline for the 3Q: from 29% in 2009 3Q to  26.7% this quarter. At this stage of the game, I doubt there are any executives at LN, WK, BNA (too soon, I think, to add Bloomberg Law) who would jump at the opportunity to occupy an executive office on the sixth floor in Eagan.

9-Month Profit Margin Comparisons. If you compare TRI's 2010 9-month performance with 2009 9-month performance in terms of underlying profit margins, the trend line remains down. Even if we wanted to call it "recovering," that's questionable at best. Let's remember that the 4th Quarter is when Westlaw contracts with their print tie-ins come up for "keep-cutback-dump" decisions for many institutional buyers and much of that will be reflected in 2010 4Q and 2011 1Q financial reporting.

Thomson Reuters Underlying Profit Margins
	2010: Nine Months	2009: Nine Months
TRI Consolidated	19.7%	21.8%
• Professional Division	25.7%	28.4%
• Markets Division	18.1%	20.1%

Where is the Professional Division's margin decline coming from? TR Legal, of course. Note how TR Legal's 9% decline in $$$ plays out. This entire division's performance rests of TR Legal and TR Legal is the cash cow for TRI.

Source: TRI 2010 3Q Powerpoint stack.

Frankly, I'm hoping TR Legal is scaling back on sales targets because I don't want to hear about sales rep layoffs. Of course if TR Legal's pricing gurus gave institutional buyers a break like Lexis has been doing for over a year now and is continuing to do by holding to last year's 4% annual print sup increases for the usual basket of titles (instead of reverting to its traditional annual 8% print upkeep increase) and is not yet increasing its annual percentage rate increase for Lexis online pricing, I wouldn't be worried about getting a "Hey, I'm your new account manager" phone call. To repeat for the umpteen time -- don't take your frustrations out on TR Legal's sales force! BTW, has anyone heard from their CCH rep lately, but I digress...

WestlawNext Adoption. 9,000 customer accounts which according to the Financial Times article is "double" initial expectations. I guess that means TR Legal expected 4,500 accounts by COB 3Q. As of COB 2Q, TR reported "[w]e are well ahead of the company's initial expectations" for WLN adoption. According to reports TR Legal had 5,700 WLN customer accounts then.

Momentum increasing? Winning over converts? You have to wonder based on the anecdotal evidence that many BigLaw firms are just saying "no" because WLN pricing isn't worth it and are either staying with Classic Westlaw or switching to Lexis. Of course, TRI is not providing information on Classic Westlaw renewals without WLN sign-ups, or online legal search customer base losses. Instead, just the more up beat reference that "20% of customers are new to Westlaw." That usually means substitution -- LN's loss is TR Legal's gain but without specificity, we don't know anything about what substitution in the other direction is, meaning how many new customers is LN acquiring at Westlaw-WLN's loss.

Very Expensive Online Legal Search Options. With the staggered roll-out of Lexis Advance stay-or-substitute choices will play out over the next 12-18-24 months. My hunch is many institutional buyers are taking a wait 'n see approach. See LLB's Playing No-Limit Texas Hold 'em with TR Legal and Lexis for Licensing Online Legal Resources.

What will Lexis Advance pricing be in the larger law firm sector? Presumbly it will be fixed-rate and very competitive. When you only have one-third of the legal search market Lexis ought not waste a perfectly good, structurally transformative recession to grab more market share. What segment-focused secondary sources will be packaged in Lexis Advance for the public sector? See LLB's Watch Out WLN, Fastcase, Casemaker, Loislaw, Here Comes Lexis Advance for Solos. Will LN uncouple its pricing of secondary sources from print subs and start pricing online secondary source optional selections more reasonably? How much will WLN's discounting be in response to this (or in anticipation of this) increased competition? Will TR Legal unlease its 21st cross-database search engine from its 20th Century pricing model?

For WLN, We Can Add the Following Questions. Will WLN's SE and search output displays substantially improve for state secondary sources and regulatory research? Critiques of WLN on secondary sources have been commonplace since the launch. See Yale Law's Tom Boone's post entitled The trouble with secondary sources in WestlawNext ("The issues associated with secondary sources in WLN need to be highlighted. Even if Thomson Reuters opts to not fix these problems, we as researchers need to be aware of them. And as instructors — both in the classroom and at the reference desk — we need to be prepared to educate others about them, too."). Stanford Law's Paul Lomio calls attention to regulatory research issues. See his post, WestlawNext for Legal Research Game 1: 2 home runs and 1 strike out ("So while the students were very impressed with WestlawNext’s ease and ability to hone in on highly relevant statutes and cases, the administrative law limitation does help with librarians’ job security.")

For both private and public sector law librarians, we should be worried about exposing our user populations to a not-ready-for-prime-time fully implemented very expensive online legal search service like WLN in addition to cost considerations. Why? Because we know our user pop will more likely rely on search results that show up on their screen displays instead of remembering whatever warnings we communicate to them -- until WLN user complaints start coming in.

If Offered WLN "Free," Would You Accept? I wouldn't be a "buyer" because nothing is "free" when it is time to re-up an online contract with TR Legal and I do not want my user pop exposed to WLN until it improves. No doubt issues will arise with Lexis Advance, too. But for very expensive online legal search right now, trends in business aren't even "boringly positive," they are just plain boring.

The only buzz about WLN is coming from TR Legal's marketing. SE, good? Sure for caselaw and statutory research but... . No SE will improve the intelligence of the legal researcher, WLN will not make anyone "more competitive," and the baked-in metadata just isn't that good for paying the WLN premium. Plus, we all know what we are doing on the legal print side of the collection development equation.

Growth Trend: Technology Trumps Employment. The above linked Financial Times article covering TRI's recently released 2010 3Q Financials reports:

financial clients on Wall Street and around the world were witnessing their own equivalent of a jobless recovery. “It has been a story of the substitution of technology instead of headcount growth,” [TRI CEO Tom Glocer] said.

The same can be said for legal services in the private sector. Now, if BigLaw started pointing to TR's financial market products and services profit margins and said "we're a buyer of online and a keeper of some print at 18%, but not above... ." With a little more competition and IT improvements, perhaps BigLaw, the segment that drives this market, will. [JH]

Time to Vote for AALL Officers and Executive Board Members

Voting online is available 24/7 beginning on Monday, Nov. 1, 2010, and ending at 11:59 p.m. Central Time, Wednesday, Dec. 1, 2010. Successful candidates will begin their terms of office in July 2011.

Vice President/President-Elect

• Jean M. Wenger, Government Documents/Foreign & International Law Librarian, Cook County Law Library, Chicago, IL
• Cornell H. Winston, Law Librarian, United States Attorneys Office, Central District of California, Los Angeles, CA

Secretary

• Deborah L. Rusin, Research Librarian, Latham & Watkins LLP, Chicago, IL
• Dennis S. Sears, Associate Director for Legal Research Instruction, Brigham Young University, Howard W. Hunter Law Library, Provo, UT

Executive Board Members (2 positions open)

• Kathleen Brown, Assistant Director for Public and Faculty Services, Oklahoma City University Law Library
• Madeline Cohen, Circuit Librarian, U.S. Courts Library for the Tenth Circuit, Denver, CO
• Gregory R. Lambert, Library & Records Manager, King & Spalding LLP, Houston, TX
• Sarah Mauldin, Head Librarian, Smith, Gambrell & Russell, LLP, Atlanta, GA

You can view the candidate biographies here. [JH]

Four-Year-Olds May Be Capable of Negligence, Can be Sued Under New York State Law

Two four-year-old children were racing their bikes under the supervision of their mothers when they struck and allegedly "seriously and severely injured" a 87-year-old woman who reportedly suffered a hip fracture caused by the accident. Justice Paul Wooten of State Supreme Court in Manhattan recently ruled that the lawsuit brought against the children and their parents can move forward. While infants under the age of 4 are "conclusively presumed incapable of negligence" under New York State common law, for children who are 4 years of age or older, "there is no bright-line rule" according to Justice Wooten. Of course, the ruling made the New York Times. [JH]