Piracy Protection

CoStar Group has the world’s largest collection of commercial real estate imagery and data, and it’s Jonathan Coleman’s job as general counsel and secretary to see that the information’s not pirated

Jonathan Coleman’s legal team is in the unique position to generate revenue for CoStar Group by identifying piracy of the company’s data and seeking back pay.
Jonathan Coleman’s legal team is in the unique position to generate revenue for CoStar Group by identifying piracy of the company’s data and seeking back pay.

Piracy since 1987

CoStar Group, Inc. is sometimes called the “Bloomberg of commercial real estate.” The company provides its clients with the largest database of industry information available on the market today, but piracy has been a concern since the company’s founding in 1987, and efforts to combat data theft have increased and evolved over time in sync with the company’s rapid growth.

This is what Jonathan Coleman and his department spend much of their time on. Coleman, CoStar’s general counsel and secretary, oversees every legal issue facing the company, and a good portion of his work involves the protection of intellectual property.

2,300 employees

When Coleman joined CoStar, the company had a couple of hundred employees, but more than 20 acquisitions and 27 years later, it has grown into a publicly traded company with more than a couple of thousand workers and annual revenues in excess of $580 million.

Nearly half of CoStar’s staff comprises researchers, who gather information to add to the company’s database, and they make Coleman’s work in intellectual property crucial. The company also has more than 300 product-development, database, and network professionals working on products and features that deliver information from CoStar’s database to customers.

14 years with the company

Coleman joined CoStar in 2000, and he believes his group’s efforts to detect and deter piracy have helped reduce such activity by creating a more educated public. But, as the company continues to grow its databases and its geographic footprint, the number of opportunities to steal from it goes back up.

15 million digital attachments

To maintain its millions of digital attachments—the world’s largest library of commercial real estate imagery—CoStar’s researchers travel thousands of miles every year to photograph buildings. They also collect aerial photographs, plat maps, and floor plans provided by third parties.

4 million properties

CoStar’s subscribers can also access information on millions of commercial real estate properties, including offices, industrial parks, retail centers, tracts of raw land, and multifamily structures. The details on each property are laid out in a way that is relevant and efficient for industry professionals. “Our goal is to include within our database detailed information and photographs for every building and every piece of commercial real estate across the country,” Coleman says. In any given year, CoStar’s researchers collect information through millions of phone calls, e-mails, and Internet updates with brokers, owners, developers, and other real estate professionals.

32 million updates

Because of just how many updates CoStar’s researchers are able to make in a typical year, the company also ends up having more intellectual property for pirates and copycats to steal. “From my perspective, protecting our intellectual property is our most important job,” Coleman says. “All the legal work that is required for an international, publicly traded corporation to operate and grow obviously needs to happen, but because we’re an information provider, protecting our data is job number one.”

2 kinds of piracy

Coleman’s team uses sophisticated network monitoring technology and software tools to investigate and remedy, primarily, two types of piracy. The first is theft by nonclients who find a way to access and use CoStar’s database without a valid license. Typically, these people have obtained log-in credentials from a current CoStar client. “People don’t think of it as stealing the way you would think about shoplifting a computer from a store, but using data without paying for it is stealing,” Coleman says. “The companies or individuals that we catch obviously have a need for our data, and in most instances we are able to quickly resolve the matter by negotiating a payment of back-fees and signing them up to their own data subscription. We have collected millions of dollars in such theft recapture over the years, allowing us to actively contribute to the company’s bottom line, which is very unique for an in-house
legal department.”

The second type of theft is from competitors. CoStar has invested tens of millions of dollars into building its database, and many companies that want to offer competitive services are not willing to put in the same investment. These pirates find ways to gain access to CoStar’s database and steal valuable information for any number of competitive purposes. Coleman’s department has devised a variety of methods to detect competitor access, from tracking IP addresses to seeding data with information that only CoStar could possibly know, thus allowing CoStar to prove that a competitor has stolen from it. According to Coleman, “When this happens, we move aggressively to protect our intellectual property, including by pursuing litigation, if necessary.”