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PACER Settlement Would Secure $125 Million in User Refunds (1)

Oct. 11, 2022, 9:25 PMUpdated: Oct. 11, 2022, 10:25 PM

Most users of the judiciary’s PACER electronic court records platform would receive refunds for fees they incurred under a $125 million settlement agreement between nonprofits and the US government.

The government must reimburse “the vast majority of PACER users in full” for past charges under the terms of the agreement, according to a Tuesday court filing by the plaintiffs in the US District Court for the District of Columbia.

The class action —brought by nonprofits National Veterans Legal Services Program, National Consumer Law Center and Alliance for Justice—challenged the legality of fees they incurred using PACER over a six-year period. They argued those fees were “excessive” and sought refunds.

Members of the class would be reimbursed automatically up to $350 for PACER fees paid between April 21, 2010, and May 31, 2018, the motion for preliminary approval of a class settlement said. Users who accrued more than $350 in fees in that time frame will receive a proportional share of the settlement.

Remaining funds after that initial distribution would be evenly distributed to class members, though no one would receive more than the total fees that they paid, the filing said. Attorneys for the plaintiffs estimate the class includes at least 400,000 PACER users.

“This is a remarkable settlement,” Deepak Gupta, of Gupta Wessler PLLC who represents the plaintiffs, said. “The notion that anyone could sue the federal court system in the federal court system—let alone achieve a result that gets most people refunds of 100 cents on the dollar—would have been unthinkable at the time we filed this case.”

In a statement, the Administrative Office of the US Courts said it was “pleased this matter has been resolved.”

The agreement must be approved US District Judge Paul Friedman, who serves as a fiduciary for absent class members, before class members can receive refunds.

Access Victory

Although the deal addresses only fees already paid, it would be a victory for those advocating for public access to court information. Advocates and lawmakers have called for PACER fees to be eliminated for the public to promote access to information.

Fees for downloading a copy of a filing run 10 cents per page, up to $3 per document. Users are also charged for searches based on the number of pages generated in that search. Fees aren’t collected if a user accrues less than $30 worth of charges a quarter.

In August 2020, the Federal Circuit sided with the plaintiffs, upholding a lower court ruling that the government wasn’t authorized under federal law to spend $192 million in PACER fees on other technology projects and remanded the case.

In November 2021, the parties disclosed they reached a reached a tentative settlement agreement.

Fees Future

During the lawsuit, which has been ongoing for more than six years, the judiciary made efforts to decrease PACER fees for most users.

Under a 2020 change to the fee waiver rules, about 80% of active users accessed records for free, the judiciary said in its most recent budget request to Congress.

The policymaking arm of the judiciary, the Judicial Conference, also approved a proposal to make federal court records searches on PACER free to non-commercial users in March.

The judiciary said it expected revenue from PACER fees to be $142 million in fiscal years 2022 and 2023 in its most recent budget request.

Lawmakers also introduced bipartisan legislation in both chambers of Congress to eliminate the fees altogether while the litigation was ongoing.

The Senate Judiciary Committee advanced that bill, the Open Courts Act (S. 2614; H.R. 5844), in December 2021. Although the House has yet to take action on the bill this Congress, the chamber easily passed the legislation in 2020.

After a district court ruling in the case, the judiciary “began funding non-covered services with appropriated funds from Congress and will continue to do so,” the AO said Tuesday.

It also underscored the district court’s finding that judiciary appropriately allocated the majority of PACER fees and said it is focused on the future of the electronic records system, including modernization efforts.

The AO also said it appointed 12 new members to its Electronic Public Access Public User Group, which provides advice and feedback to the AO on public access to court services, including PACER. Those members include Mike Lissner, executive director of the Free Law Project, which develops and maintains tools to ease public access to court information and records.

Blayne V. Scofield, a senior product manager for Bloomberg Law serves on the judiciary’s electronic access user group panel. Bloomberg Law’s product group is separate from the news division.

—With assistance from Perry Cooper

The case is Nat’l Veterans Legal Servs. Program v. United States, D.D.C., No. 1:16-cv-00745, plaintiffs’ motion for preliminary approval of class settlement 10/11/22.

(Adds copy of filing.)

To contact the reporter on this story: Madison Alder in Washington at malder@bloomberglaw.com

To contact the editors responsible for this story: Seth Stern at sstern@bloomberglaw.com; John Crawley at jcrawley@bloomberglaw.com