Rumors had been swirling that Thomson Reuters was about to acquire Casetext, and they proved to be true.
Just before 9 p.m. Eastern time today, TR said it had signed a definitive agreement to acquire Casetext for $650 million cash.
“The proposed transaction will complement Thomson Reuters existing AI roadmap and builds on its recent initiatives, including a commitment to invest more than $100 million annually on AI capabilities, the development of new generative AI experiences across its product suite, as well as a new plugin with Microsoft and Microsoft 365 Copilot for legal professionals,” TR’s announcement said.
The acquisition unites a long-established giant in legal research with a company that has proven to be a feisty upstart since its founding in 2013. As I wrote of Casetext just two weeks ago, as it marked its 10th anniversary, “From the very start, Casetext was an innovator, always pushing the envelope for what a legal tech product and company should look like. By doing that, it has been always a trailblazer, never a follower.”
Earlier this year, it launched CoCounsel, an AI legal assistant developed in partnership with OpenAI and using the latest version of OpenAI’s GPT large language model.
Even before launching CoCounsel, Casetext had already launched the powerful neural net search technology AllSearch and had pioneered products such as Compose, to help lawyers draft litigation briefs, and, in 2016, CARA, the first product to use AI to analyze briefs, which spawned a generation of copycat products, including by Thomson Reuters.
“The acquisition of Casetext is another step in our ‘build, partner and buy’ strategy to bring generative AI solutions to our customers,” said Steve Hasker, president and CEO of Thomson Reuters. “We believe that Casetext will accelerate and expand our market potential for these offerings – revolutionizing the way professionals work, and the work they do.”
“For the last ten years, we have harnessed the power of AI to build products that elevate the practice of law and enable attorneys to serve more people’s legal needs, with the ultimate goal of increasing access to justice,” said Jake Heller, CEO of Casetext. “Joining Thomson Reuters is an incredible opportunity to advance our mission and the field of generative AI solutions exponentially, not only for lawyers but across professions, ensuring this revolutionary technology can benefit as many people as possible.”
TR said that closing of the transaction is subject to specified regulatory approvals and customary closing conditions and is anticipated to occur in the second half of 2023.
I am of mixed emotions about this. While I am thrilled for Casetext’s founders, who have worked hard for 10 years to create one of the most innovative tech companies in legal, I fear for the implications of the loss of a feisty competitor. Not only has Casetext been innovative, but it has launched products so original that other companies have had to scurry to catch up with them.
With Casetext now swallowed up by the industry giant, will that spirit of innovation and originality be lost? I sure hope not.