As a Silicon Valley securities lawyer, Boris Feldman relies on the Internet the way some attorneys turn to dusty casebooks. One of his favorite websites: the Stanford Securities Class Action Clearinghouse, which he visits three or four times a day to download a legal document or check the fine print of a federal law. "It's fabulous," says Feldman. "How did we practice law without this?"
The online clearinghouse, built and maintained at the Stanford Law School, is in fact the world's preeminent website monitoring lawsuits against publicly traded companies. It makes court filings -- usually available only at courthouses -- easily accessible to judges, lawyers, investors, scholars and journalists. Fully searchable, it also links to stock quotes and to the reams of reports filed with the Securities and Exchange Commission (SEC). A feature that e-mails notices when lawsuits are filed has drawn some 2,000 subscribers -- including U.S. government officials and finance ministers in Europe and Asia.
The site is the brainchild of Joseph Grundfest, a Law School professor and former SEC chair. The idea came to him after Congress passed a 1995 law requiring that anyone filing a securities class action in federal court inform the public of the lawsuit. That created an opportunity to track all such suits as they progressed through the courts. With Law School librarians Paul Lomio and Erika Wayne, Grundfest, JD '78 -- a bit of a techie himself -- built a database to house key documents filed in these cases. The site, securities.stanford.edu, went live in December 1996.
That was only the beginning. Grundfest and his team knew the site would be more comprehensive if all the parties in securities class actions were required to transmit their filings for online posting. So he showed the clearinghouse site to judges sitting on the federal court for the Northern District of California, the nation's most active jurisdiction for this type of lawsuit. Impressed, the judges established a rule in March 1997 mandating that documents be posted on a "designated Internet site," such as the clearinghouse.
As the project grew, some trends emerged. Data from the clearinghouse reveal that federal securities class actions hit an all-time high in 1998. The site also shows that high-tech companies are the most frequently sued.
Grundfest says the site could serve as a model for the court system nationwide. He imagines a day when every document in every U.S. court is filed online. "It's almost too obvious for words," he says. "But it's going to take some time." Maybe less than he thinks. Already, Congress has taken note of the Northern District of California's requirement -- and urged other federal courts to post their filings.
