‘It’s the vibe’: Court brawl hinges on alleged industrial-scale data hack

If you have any property dealings in Australia, chances are you have had a relationship with the group formerly known as CoreLogic, a data giant which feeds the entire real estate ecosystem from homebuyers to banks, lawyers, insurers and government agencies.

But its business tentacles stretch much further into the Australian economy, which is one of the reasons why this week’s courtroom drama with bitter rival Hubexo, formerly known as BCI, is such compelling viewing for the corporate sector.

There is a lot at stake for both CoreLogic – now called Cotality – and Hubexo which hold an effective duopoly over the lucrative nexus of property, construction and data.

In 2021, Hubexo sued CoreLogic for copyright infringement, breach of contract, and misuse of confidential information over a scheme to allegedly steal data from one of its crucial services: LeadManager. But the case is only now being heard in court.

LeadManager is a subscription service designed to help businesses find new projects in Australia’s construction sector, an industry worth more than $600 billion in 2023-24 alone, according to ABS statistics.

The data service identifies the key personnel and contract tenders needed by anyone in the construction cycle ranging from architects to electricians and painters based on information compiled from government and private sources.

Whether Hubexo processes this information to the extent that it can then claim copyright over this database is one of the central issues being examined in this case.

It is one of the reasons why the Federal Court findings could also have significant implications for what is protected by copyright law and intellectual property. Particularly regarding databases and automated data extraction.

CoreLogic’s rival product is Cordell Connect, and the story starts back in 2016 with CoreLogic staff – according to court documents – lamenting their inferior product.

The court heard this week how CoreLogic executives set up what they described as a “war room” to copy information from its rival’s service and populate its own product to make it more competitive.

What followed between 2016 and 2020, according to court documents, can best be described as a carefully crafted system where third-party companies – often run by relatives of CoreLogic employees – were used to access Hubexo’s LeadManager.

Hubexo lawyers accused its rival of hacking. A claim which CoreLogic denies.

But there was a clear challenge for its employees, as detailed in court, to harvest as much data as possible without setting off alarms at its rival.

The court was told of CoreLogic staff coordinating their access, to ensure they wouldn’t double-up – behaviour which Justice Jane Needham, likened to “sharing of Netflix accounts among teenagers”.

CoreLogic’s legal team later took the analogy a step further to explain how benign their transgression was.

According to CoreLogic, what they did was not akin to sharing an account to surreptitiously watch Netflix shows, it was more like someone from a Netflix rival using the family account to do an inventory of what movies and TV shows it had.

It will be up to the court to determine if this argument holds sway over emails presented as evidence that include an executive telling a colleague: “We just need to get on top of what they are doing differently to us and close the gap.”

Damning emails presented to court showing the cat and mouse attempts by CoreLogic staff to hide their true identity and avoid getting caught harvesting data from Hubexo’s LeadManager.

“Significant lies were told. So please be careful going forward,” one CoreLogic executive warned after their access was restored after suspicious behaviour was detected.

“They wrote us a legal letter threatening to sue. My bad. BCI [Hubexo] caught on and blocked our account,” was another email exchange presented to the court.

At its peak, details of more than 150,000 projects were extracted with CoreLogic executives relying on carefully programmed bots – “Robotic process automation” in the terms used by the executives – to extract the information without alerting Hubexo to the automated harvesting of its data.

“To get around this, we will add human-like delays between the requests,” was one exchange brought before the court describing the level of effort involved in avoiding suspicion.

If the allegations sound wild, so does the defence.

CoreLogic is not shying away from the subterfuge that was evident in the documents presented to the Federal Court.

The first line of defence is that CoreLogic did not trust much of the data and ultimately used very little of it, despite the massive extraction process over many years.

In the words of former US President Bill Clinton: They “didn’t inhale”.

But CoreLogic’s main argument is a more basic one.

Their lawyers argue that much of the information was publicly available, but more importantly – despite Huxebo’s “hyperbole, bluster and outrage” – they say their rival has failed to prove a causal link between their conduct and actual financial loss.

Huxebo has argued that it has suffered losses from customers going to its rival, being forced to issue discounts to keep customers, and the loss of perspective customers.

But it is relying on the “common sense” argument to prove causation of its loss. In essence, it says that, in a duopoly, if it loses a customer, there is only one place for them to go: CoreLogic.

CoreLogic’s legal team criticised this argument in court.

“The overall problem is that the applicant cannot prove, and scarcely even attempts to prove, that it suffered any loss or that the respondents (CoreLogic) made any gains in respect of the customers,” CoreLogic says in a document filed with the court.

They invoked the Australian comedy The Castle to ridicule the logic of this argument.

“It’s the – sort of – legal reasoning which the applicant urges upon your Honour, which we say is reminiscent of little more than – resorts to concepts such as ‘the vibe’,” CoreLogic’s barrister James Hastie, told the court.

Of course, in The Castle, the ‘vibes’ win the day. This case continues next week.

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