Tag Archives: EDGAR

The PACER (Public Access to Court Electronic Records) database of judicial opinions, pleadings, motions and other papers continues to present a vexing public access issue. Brian Brodie, at the online news site Quartz (whose audience is “business people in the new global economy”), provides a good review of the issues around the current state of free access to PACER. He compares the issues around free access to PACER to the same issues around the SEC’s EDGAR system.

• Browdie, Brian. 2014. Why Pacer should (and should not) be like Edgar. Quartz (Nov 24, 2014).

Below, I expand the parallels between EDGAR and PACER and provide some background on EDGAR for those who weren’t following the drama during the 1990s that surrounded making EDGAR freely available to all.

Background

Design for ingest not public access

As Browdie points out, PACER is a database of databases of 94 district courts, 93 bankruptcy courts, and 13 circuit courts that compose the federal judiciary. The system was not designed as a single public access system, but as a number of separate systems designed for lawyers and litigants to use in filing court papers.

Similarly, The Security and Exchange Commission’s EDGAR (Electronic Data Gathering, Analysis and Retrieval) was developed (in the late 1980s) as a way of automating submissions of financial records to the SEC – much the way PACER is a way of automating submission of court records. The SEC contracted out the management of the data and the public access part to a private company, Mead Data Central.

Intended to be self-supporting with fees

Congress has ordered the Judicial Conference of the United States to fund electronic access to PACER records from fees. So, apologists argue, PACER has to charge fees.

Access to EDGAR was also, originally, fee-based. The EDGAR data was only made available through private sector companies who charged as much as $50 for single document and fees for access as high as $3,500 a month. (New York Times, May 1995, Flynn). In the 1990s, those who argued that this was the right way to do things claimed that the SEC is required to fund itself (Thomason).

Those wanting to retain fees for EDGAR insisted that the market was the only proper way of providing the data, that competition among commercial vendors would hold down the price for users (Kerber), and that making the data freely available would impede the development of a market-based solution for repackaging the data in convenient formats for easy use (Flynn).

Those in favor of PACER fees go even further. PACER fees are needed, they argue, to fund related projects. The courts use only about $20 million of the $140 million that PACER brings in each year to cover the costs of PACER. The rest of the PACER-fee income, Browdie reports, is given to the courts to cover outlays for the filing system; for video monitors, audio and other electronica that courts need to stage trials in the 21st century; and for security systems for the 197 separate databases. (See also: Report: PACER Federal Court Record Fees Exceed System Costs.)

The public doesn’t want or need the data

Another argument against making PACER freely available is that the data is too specialized for the general public. In fact, Browdie points out, about 70% of PACER’s use is by those inside the justice system. Browdie also notes that PACER’s complex fee structure, which allows some use without charge, results in three-quarters PACER’s users not having to pay for access. Recently, when PACER took years of documents offline, one of the excuses used to justify the removal was that the cases that were removed were closed and that many had not been accessed in several years (Peterson).

Much the same argument was made about EDGAR data. Before the data was made freely available to the public, the SEC had seen the public as non-professionals who were not “the right kind of people” (Malamud).

Technical Problems

Some have argued that there are technological reasons to restrict access to PACER and EDGAR. As noted above, PACER removed a large number of documents this year and in doing so gave several explanations for doing so. One was technical: a spokesman for PACER said that the replacement of legacy case management systems with a new system meant that the systems used by some of the courts were incompatible with PACER.

Similarly, when Carl Malamud first suggested that the SEC should put EDGAR on the internet, the SEC said that it was technically impossible to do so (Malamud).

Public or Private?

PACER documents and EDGAR data are explicitly official, public documents, but advocates of imposing fees on PACER documents make an argument for privacy of those involved in court cases.

They say that many court documents contain private information such as social security numbers and health records. This is a difficult argument to make since the documents are publicly available even though they contain private information. Peter Winn, a Department of Justice prosecutor, explains that limiting access to digital copies of public documents is what former Supreme Court Justice John Paul Stevens called “practical obscurity” – the private information is not unavailable, but it is (in practice) difficult to get.

Bad policies masked with invalid excuses

It is interesting that so many of the arguments against making PACER data freely available were also made against making EDGAR data freely available. And yet, today we do have free access to EDGAR data. Time has shown that these arguments were simply wrong. They are not valid expressions of obstacles, but excuses that mask conscious policy decisions.

• The technical problems were and are illusory. Carl Malamud put EDGAR data online with a small grant and minimal technology. PACER has determined that it can put those older documents online after all (See PACER to restore documents it took offline). The designs of both systems for ingest rather than distribution have not kept either system from, in fact, distributing their data.

• The problems of financing and protecting privacy are not intractable problems; both can be easily solved – they simply take the will to do so. Congress can make fees unnecessary by funding public access. The Courts can create real privacy protections by creating and enforcing rules that limit private information in public documents. These are not “problems” but decisions. Steve Schultze has identified a real problem that, if faced by the courts, would result in a change in policy. He has characterized PACER’s use of income from fees to finance non-PACER court functions as illegal (Schultze). But Congress and the courts have chosen not to make PACER free.

• As for public demand for these “specialized” databases, both EDGAR and PACER have proven to be valuable resources that are, in fact, used by more people when they are made more available. Once the EDGAR data was made available, users flocked to use the data and insisted that the SEC open access permanently (Flynn). The Office of the U.S. Courts has reported that, even with fees in place, PACER added an average of 3,000 new accounts every week in FY2011. It is not that the public does not want the data; it is that the courts want the fees. For example, they reacted negatively when use increased when documents were made free in a pilot program (Singel). And the claim that most use is by those inside the judicial system and is available without fees simply ignores those potential users of PACER (journalists, academics, law libraries) who might use this system but do not because of high fees.

Making PACER free like EDGAR

We can learn a lot about the possible future of PACER by examining the history of EDGAR.

Library organizations were quick to recognize the value of the SEC’s EDGAR data and, in 1989, several suggested that the data should be made available through the FDLP (Federal Depository Library Program). That effort was strongly opposed by Mead Data Central, who had a contract with the SEC to manage EDGAR, and the proposal was killed. Mead claimed it would cost too much to provide online searching of EDGAR from the 1,400 FDLP libraries (Love).

In the same way that libraries tried to get access to EDGAR data, they have also tried to get access to PACER data.

A pilot program to make PACER data freely available in a few libraries closed down under somewhat mysterious circumstances. (Jacobs, 2009). The Government Printing Office has a program to get some of the data that is in PACER into FDsys, but the program does not provide free access to all PACER data (Jacobs, 2011).

It was action that freed EDGAR. In 1991, the Taxpayers Assets Project and Carl Malamud took interest in the SEC data (Love). Malamud demonstrated that the data could easily be made available for free – but he did so explicitly for a short period of time. His free copy of the data became very popular and was heavily used. He urged users to tell the SEC they wanted the agency to make the data free. Users flooded the SEC with comments and the SEC relented and made EDGAR free and open to the public (Malamud).

Interestingly, after the SEC decided to make EDGAR freely available on the web, Arthur Levitt Jr., who was chairman of the SEC at the time, said, “[A] library that charges people by the page, or by the minute, is no longer a library” (New York Times, Aug 1995). Charging by the page and the search is exactly what PACER does. Libraries eventually won the fight and, as this quote shows, even recruited the SEC as an ally of sorts in freeing EDGAR data. But libraries have not been successful in the case of PACER.

It will almost certainly take action by the public to free PACER. Libraries could take the lead in such an action. Certainly the excuses PACER and the Courts have given for retaining fees have been demonstrated to be hollow justifications for bad policy, not actual obstacles.

Libraries need to recognize the potential of the PACER data and fight for freeing it. In doing so, they will be fighting for their communities. In an age when some librarians have trouble articulating their relevance to their communities, this should be an obvious thing to do.

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Endnotes

Flynn, Laurie. June 1994. The Executive Computer; Need Timely S.E.C. Corporate Filings? Look on Internet. New York Times. (June 19, 1994)

Jacobs. James A. 2009. Still no official word on PACER project. FreeGovInfo (Feb. 12, 2009).

Jacobs, James A. 2011. FDsys Court Opinions Project and PACER. FreeGovInfo (May 5, 2011).

Kerber, Ross. 1993. What Cost Public Information? SEC’s New Data System Prompts Debate on Commercial Control of Government Records. The Washington Post p.F–5. (June 21, 1993). [subscription required]

Love, James. 1993. SEC’S EDGAR ON Net, What Happened And Why Taxpayer Assets Project. TAP-INFO Internet Distribution List (October 22, 1993)

Malamud, Carl. 1999. The Importance of Being EDGAR. Mappa.Mundi Magazine.

New York Times. May 1995. Same-Day Internet Access to S.E.C. Filings. New York Times. (May 1, 1995)

New York Times. August 1995. S.E.C. to Continue Internet Access to Filings (August 28, 1995).

Office of the U.S. Courts. 2011. PACER Adds 3,000 Accounts Weekly in FY2011.

Peterson, Andrea. 2014. Why PACER removed access to case archives of five courts. Washington Post (August 26, 2014).

Schultze, Steve. 2013. My Bill to #OpenPACER in memory of #aaronsw – Open for Comment and Available on Github. Freedom to Tinker. (Feb. 1, 2013).

Singel, Ryan. 2009. Federal Courts Wary of Document-Sharing Plugin. Wired. (Aug. 25, 2009).

Thomason, Robert. 1995. Battle Brews Over Fees for SEC Report; Group Believes Public Should Have Free Access. The Washington Post (January 9, 1995). [subscription required].

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See Also: additional FGI coverage of PACER.