Legal research technology company Fastcase, which is now owned by Clio, has filed a federal lawsuit against AI-powered legal research platform Alexi, alleging breach of contract, trademark infringement and trade secret misappropriation, relating to its use of data licensed from Fastcase.
The complaint, filed Nov. 26 in the U.S. District Court for the District of Columbia, accuses the Canadian company of transforming a limited data license into a competing commercial product.
Although Alexi has not yet formally responded to the lawsuit, its founder and CEO Mark Doble told me yesterday afternoon that he denies any wrongdoing and that he believes the lawsuit is based on a misunderstanding of the original licensing agreement that came to light during Clio’s recent closing of its purchase of vLex, which had merged with Fastcase in 2023.
According to the complaint, Fastcase and Alexi (formerly known as Alexsei) entered into a data license agreement in December 2021. At that time, the complaint says, Alexi operated as what it described as a “research institution,” employing staff attorneys who used AI-assisted passage-retrieval technology to prepare legal research memoranda for clients within 24 hours.
The agreement, the complaint alleges, granted Alexi access to Fastcase’s proprietary legal database solely for “internal research purposes” — specifically, research conducted by Alexi’s own lawyers in preparing client memoranda. The license explicitly prohibited using the data for commercial purposes, competitive purposes or publishing or distributing the data in any form, Fastcase alleges.
(Although Fastcase filed a copy of the licensing agreement with the court, it did so under seal, so it cannot be viewed by the public.)
Fastcase, founded in 1999, merged with vLex in 2023 and was subsequently acquired by Clio for $1 billion in a transaction that closed Nov. 10 — described in the complaint as “one of the most significant transactions in legal technology history.”
At Issue Is Fastcase Data
The lawsuit centers on Fastcase’s claim that Alexi fundamentally changed its business model while continuing to rely on Fastcase’s data under the original restricted license.
Beginning in 2023, Fastcase alleges, Alexi shifted away from its lawyer-staffed memorandum service and began building a direct-to-consumer AI legal research platform that competes with Fastcase. According to the complaint, Alexi removed the “internal research” component entirely and began publishing Fastcase-sourced case law directly to end users.
The complaint cites public statements by Alexi’s CEO Doble, including a March 2024 LinkedIn post in which he described Alexi as “increasingly a legitimate alternative to incumbent legal research providers.”
Doble reportedly stated that relative weaknesses including “access to additional content (primary & secondary) and primary law meta-data (e.g. shepardizing)” were “easily solvable in the next 3-6 months.”
Following an $11 million Series A funding round in June 2024, the complaint alleges, Alexi expanded its platform to include document analysis, case management tools and other features typical of full-scale legal research providers.
Evidence Cited in the Complaint
As evidence of Alexi’s unauthorized use, Fastcase’s complaint points to several public demonstrations of Alexi’s platform — including one I recorded with the company last May for my How It Works video series. In that video, according to the complaint, Alexi’s Chief Revenue Officer Daniel Diamond “showcased direct access to Fastcase Data and continued to use Fastcase’s registered marks within its platform.”
The complaint includes this screencap of my ‘How It Works’ interview with Alexi, allegedly to show unauthorized use of Fastcase data and trademarks.
The complaint also cites an October 2024 demonstration for HeyCounsel in which Diamond presented Alexi’s AI chat interface, stating that Alexi’s model was “trained on over 30 million pairs of questions and answers that are derived from caselaw.”
The complaint includes screenshots from those two demos that show Alexi’s interface displaying full-text case law with a button stating “View this document on Fastcase,” which Fastcase characterizes as unauthorized use of its trademark and an implied affiliation that was never authorized.
Diamond also reportedly acknowledged that Alexi had moved beyond its original passage-retrieval tool and now acted “as a wrapper on top of third-party AI models using Fastcase Data,” the complaint alleges.
Alexi CEO Denies Wrongdoing
In an interview yesterday, Alexi CEO Doble denied that the company had violated its agreement with Fastcase and expressed his hope that the lawsuit can be resolved quickly.
Although he told me that he is limited in what he can say because of the pendency of the lawsuit, he attributed it to a “massive miscommunication” and said that Alexi is “doing everything we can to try and resolve it as fast as we can.”
The full text of the license agreement is under seal in the lawsuit at Clio’s request. But Doble said he has always been careful never to operate beyond the license’s scope.
The reason it came to a head now, Doble suggested, is that Clio only became aware of the agreement during the final weeks before the Nov. 10 date on which it completed its acquisition of vLex.
Until then, he said, no one at Fastcase or vLex had ever before questioned the licensing agreement or Alexi’s actions under it. His relationship with both companies had always been cordial and cooperative, he said, even to the point of their engineers having worked together to develop some of the functionality now at issue.
He disputes the complaint’s allegation that Alexi shifted its business model after entering into the licensing agreement. From the company’s founding, he said, its mission was always to fully automate the production of research memos. While it initially employed lawyers to control the accuracy of its memos, its goal was always to become fully automated, and that was clearly communicated to Fastcase, he said.
Doble describes the misunderstanding around the terms of the agreement as being the result of a “bit of broken telephone” in the transitions over the years from Fastcase to vLex and then vLex to Clio.
“It’s clear there’s a lot of information that Clio doesn’t have that we have that now we’re just trying to go through and work with them on explaining,” he said.
October Notice of Breach
Doble said the first he heard of any problem was in late October, when he received a phone call from a vLex executive, which was then followed on Oct. 27 by vLex sending Alexi a “Notice of Material Breach” demanding the company cure its breaches within 30 days as required by the agreement.
According to the complaint, Alexi’s counsel responded on Nov. 3, denying any breach and expressly admitting that Alexi had used Fastcase data to train its generative AI models.
The response stated: “The intention of the Agreement was never to preclude Alexi from using Fastcase Data as source material for Alexi’s generative AI product; that is exactly what Alexi was paying Fastcase nearly a quarter million dollars for annually.”
Fastcase characterizes this as an acknowledgment of conduct prohibited by the agreement’s plain terms and notes that Alexi stated its intention to continue using the data “as it had been.”
After the 30-day cure period expired without resolution, Fastcase terminated the agreement and filed this lawsuit.
A Clio spokesperson declined to say anything more about the allegations of the lawsuit beyond what is alleged in the complaint.
“Clio takes its contractual obligations and our responsibility as stewards of our intellectual property very seriously,” the spokesperson said. “We follow established processes to ensure our licensed data is used appropriately in order to protect the integrity of our content library.”
Legal Allegations
The complaint alleges that Alexi materially breached the Data License Agreement by using Fastcase data to train and develop Alexi’s commercial AI legal research product and in other ways.
It also asserts that Alexi violated Fastcase’s trademarks and used the Fastcase name and trademarks in its interface and marketing materials.
Perhaps most significantly the complaint alleges that Alexi misappropriated trade secrets through its unauthorized use of Fastcase’s database.
Fastcase is seeking extensive remedies, including a declaratory judgement that Alexi materially breached the contract, a permanent injunction, compensatory damages, and disgorgement of all revenues and profits from unauthorized use.
‘A Huge Misunderstanding’
Some of you reading this may be wondering if this is déjà vu all over again, as this blog continues to follow the long-running litigation of Thomson Reuters v. ROSS Intelligence.
Yes, that lawsuit involves an established, Canada-based legal research company suing a Canada-based legal research startup, much as this one involves the Canada-based legal tech giant Clio suing the Canada-based Alexi.
But in this case, Doble expressed hope that Canada connection would work in favor of a quick resolution.
“We’re a Canadian legal tech company and Clio is the Canadian darling legal tech company,” he said. “I still have a ton of respect for what they’ve done — we all at Alexi look up to them. They’re an amazing company. …
“I just think there’s a huge misunderstanding, miscommunication, and I’m confident it’ll be resolved pretty quickly.”
The case is assigned to Judge Richard J. Leon in the U.S. District Court for the District of Columbia, case number 1:25-cv-04159.
Fastcase is represented by attorneys from Wilson Sonsini Goodrich & Rosati, including Paul N. Harold in the firm’s Washington, D.C., office.
