New Class Suit Hits LexisNexis for Unfair Fees

SAN ANTONIO (CN) - LexisNexis has been charging litigants "unconscionable" rates to file online documents in some Texas state courts, creating a poll tax-like situation that creates an unconstitutional barrier to open courts, a class action claims in Bexar County Court. The company and its Netherlands-based parent, Reed Elsevier, face similar lawsuits in Georgia and Texas federal court.

Lead plaintiff Karen McPeters says she was affected by the LexisNexis' deceptive practices when the discrimination case she filed against Montgomery County, Texas, was transferred to that county's court, where electronic filing is mandatory, in September 2007.

LexisNexis unlawfully conceals that it charges "nearly $16 for every piece of paper filed" online in Montgomery County District Court, according to the complaint.

"On January 27, 2009, the Montgomery County District Clerk notified counsel for Plaintiff McPeters that the case was designated as an e-file case," according to the complaint. "The clerk stated that e-filing was mandatory, and that all pleadings would have to be filed with LexisNexis. Counsel was told that LexisNexis charged litigants for E-filing and that plaintiff McPeters would have to pay those charges."

Since neither Montgomery County nor LexisNexis provides litigants with a list of charges levied by Reed Elsevier - the Netherlands-based parent company of LexisNexis - McPeters says that she only leaned about the rates when the company first billed her counsel on March 6, 2009.

"LexisNexis' charges are unconscionable and excessive as compared to (1) the cost of filing under the Texas Rules of Civil Procedure, and (2) the charges of other providers of E-filing services (Texas On-Line)," the class claims. "Approximately 252 counties in Texas do not charge to file a paper copy of a motion or pleading in their district courts, other than filing fees at the time of filing the lawsuit.

"Texas On-Line charges $7.24 to E-file a document and shows the charge at the time of filing," the complaint continues. "LexisNexis charges $15.98 (including tax) to e-file a document in the two counties that it services and does not disclose its charges at the time of filing. It charges $7 for filing and $8 for service; service is mandatory."

E-filing through LexisNexis is also mandatory in one or more of the courts in Jefferson County, Texas, according to the complaint.

McPeters claims that LexisNexis' fees for filing in Montgomery County District Court also violate Texas state law by duplicating "part of the fees charged by the district clerk when each lawsuit is filed."

In addition to charging burdensome fees, McPeters says LexisNexis "made unlawful threats for collection including a threat to report each nonpaying litigant to the Texas State Bar and to the judge presiding in the case."

The company also lied about being an agent of the Montgomery County District Clerk, McPeters says.

"In fact, LexisNexis stated, 'LexisNexis has been acting in furtherance of official duties,'" according to the complaint. "The Montgomery County District Clerk denied that claim on Aug. 3, 2010 when it argued to the Ninth Court of Appeals that LexisNexis' charges were not court costs but were actually convenience fees."

The complaint continues: "LexisNexis claims to act as the official agent of a district clerk with authority to regulate access to Texas courts. The Texas Supreme Court never agreed."

In addition to charging fees that unreasonably obstruct court access, McPeters says Texas Supreme Court precedent shows that the charges simply duplicate ones already levied by the services of the court's clerk.

LexisNexis gained its unfair hold over the Texas court in 2003 when U.S. District Judge Frederick Edwards signed an order mandating E-filing through LexisNexis for all lawsuits in his court in Montgomery County, according to the complaint. The only cases exempt from the order - and LexisNexis' fees - are those brought by the Texas or Child Protective Services, as well as adoption, new divorce and annulment cases.

While the Texas Supreme Court agreed that Montgomery County could establish an electronic system, it never authorized the mandatory fees, McPeters says.

The complaint states that LexisNexis has defended its practice by pointing out that litigants have the option of bringing uploading documents themselves through a free computer terminal in the clerk's office.

"The terminal, however, is no solution for out-of-county litigants and those who seek to file by mail under the Texas Rules of Civil Procedure," according to the complaint. "One cannot reasonably require a litigant to drive to the courthouse each time he or she wishes to file a document."

In any case, McPeters says that "free" computer requires users to subscribe to LexisNexis, according to the complaint.

Montgomery County's district clerk will also not take any action on documents for e-file cases that are mailed or handed to her to file, according to a similar lawsuit in Houston federal court. Instead, she mails them back to the litigants without filing them and provides instructions on how to file through LexisNexis.

LexisNexis has also allegedly pointed out that Judge Edwards' 2003 gives litigants the option to file a motion to file documents conventionally in his court, but "the order is not accessible online, through the District Clerk, LexisNexis, or the web page of any district court," McPeters claims.

"The order actually allows a party to ask for permission to file a document by traditional means only when a transmission error or other technical problem has occurred when attempting electronic filing," according to the complaint. "There is actually no alternative to enduring the avalanche of charges from LexisNexis in a case assigned to the 9th District Court in Montgomery County," McPeters claims, referring to the Edwards' court.

LexisNexis' attempts to charge and collect filing fees from litigants in the 9th Montgomery County District Court, and its failure to disclose charges and threats of unlawful collection measures, violating the Texas Deceptive Trade Practices - Consumer Protection Act, McPeters says.

LexisNexis is also violating the Consumer Protection Act by passing off its goods or services as those of the Montgomery County District Clerk, and causing confusion about its affiliation with the clerk, according to the complaint.

McPeters continues that LexisNexis knowingly violated the Texas Consumer Protection Act because it "knew or should have known that permissible fees and charges are set forth in the Texas Government Code and Local Government Code. LexisNexis knew, or should have known, that court filing fees are set by the state legislature, because court filing fee information is codified in Vernon's Texas Codes."

When the Texas Legislature considered electronic filing in 1987, "it made no provision for additional mandatory filing fees or unregulated charges as a condition for access to any court," McPeters says.

McPeters says more than 16,000 Montgomery County litigants have been subjected to LexisNexis illegal filing fees since 2000.

"LexisNexis charges are an unconstitutional barrier to open courts according to authority from both the Texas Supreme Court and the Texas Attorney General," according to the complaint. "There is no precedent for this barrier. The charges are like a poll tax. Minorities, the poor, elderly and the less educated are likely to be denied their day in court. Is it reasonable to require them to be computer literate? Payment for justice is now a fact of life, but should it be?"

McPeters seeks treble treble damages. She is represented by Robert Mays of San Antonio.

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New Class Suit Hits LexisNexis for Unfair Fees

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