The most misread sentence in corporate due diligence is “no records found.”
It arrives near the end of a background report, under a heading like Civil Litigation, and the client reads it as a clean history. What it usually means is narrower: a vendor ran a name against the databases it licenses, and none of them returned a match.
Those are two different claims. Only one of them is about the subject.
A records search is a coverage question
Court records in the United States are not one system. They sit in 94 federal district courts, plus the bankruptcy and appellate courts, plus the trial courts of fifty states, which are organized county by county and run by separately elected clerks. Florida alone has 67 clerks of court. Each one keeps its own civil index, sets its own retention practice, runs its own public portal, and started digitizing in its own year.
No product searches all of that. Every civil records vendor holds a set of jurisdiction feeds, and the set has holes: counties never onboarded, counties refreshed quarterly instead of nightly, counties whose online index reaches back to 2004 and stops. When the vendor finds nothing, the report prints no records found. That is not a search result. It is a statement about the vendor’s contract.
PACER covers federal courts and stops there
PACER is the federal judiciary’s public access system, and for what it holds it is excellent. Ten cents a page, capped at $3.00 per document, free entirely if quarterly usage stays under $30. The Case Locator will sweep district, bankruptcy, and appellate filings nationwide in one query, which is why so many reports lean on it.
State court is the part PACER does not hold. The breach of contract suit, the fraud claim, the injunction, the foreclosure, the mechanic’s lien, the collections judgment: state venue, county courthouse, local clerk. A subject can carry four active state suits and a spotless PACER result at the same moment, and both results are accurate.
Florida adds a second floor to fall through. County court handles civil matters up to $50,000 under Fla. Stat. § 34.01, and circuit civil takes everything above it. A good many “civil records” pulls only cover circuit. So a $48,000 judgment for breach of contract, entered against your target last year, sits one court below the search that came back clean.
Name matching breaks on ordinary names
Court indexes are keyed on party name, sometimes with a date of birth attached, frequently without. A man who files as Robert J. Mitchell in Hillsborough County and appears as Bob Mitchell in Pasco produces two index entries no exact-match query will join. Clerks drop middle initials. Common surnames return two hundred hits, and an analyst clearing that list in an afternoon by discarding everything without a birthdate match will discard true positives at roughly the same rate as noise.
The structural gap is worse than the spelling gap. Individuals get sued. Operating companies get sued far more often, and the company is the name on the caption. Run the check on the person, and if the business is a Delaware LLC whose sole member is a second LLC, the entire litigation history sits under a party name nobody queried. That is the same blind spot that makes vetting a leader before you hand over the keys a research problem rather than a database problem.
The aggregators publish their own gaps
Coverage documentation exists. Every serious data vendor maintains a jurisdiction table listing each county carried, the case types included, the earliest available record, and the refresh interval. It is not secret. It is a sales document, and most vendors will send it on request.
Almost nobody asks for it, and almost no finished report cites it. So the buyer receives a conclusion with the one fact removed that would let anyone test it.
A report that names its venues can be checked, argued with, and if necessary corrected. A report that names none of them cannot be wrong, because it never said anything specific enough to be wrong. That is the same weakness that makes adverse media screening feel productive while the underlying pattern stays invisible.
The disposition code hides the case
An index hit gives you a case number, party names, a filing date, and a disposition code. Disposition codes lie by compression. “Dismissed” covers a voluntary dismissal three weeks after a confidential settlement and a dismissal for failure to state a claim, and those two facts point in opposite directions about the person you are about to do business with. The pleading tells you which. Pull the pleading.
The same caution applies to how the result gets carried into a report. A page printed off a clerk’s portal, dropped into a PDF with no case number, no retrieval date, and no clerk certification, will survive right up until opposing counsel asks where it came from, for the reasons a screenshot fails as evidence anywhere the other side gets a vote.
What a defensible venue list looks like
The venue list comes from the subject, not from the vendor. Build the residence and business history first: every county the subject has lived in for the past fifteen to twenty years, plus anywhere he registered a business, held a professional license, or recorded a deed. Add the states where an entity under his control was organized or qualified to do business, because a company sued in Georgia leaves nothing behind in the Florida index. Then add the federal district covering each of those counties, and the bankruptcy court that sits in it.
For an executive with a twenty-year adult record across three states, that arithmetic usually lands at six to nine county venues and three or four federal districts. Call it a dozen pulls. A nationwide civil search costs $19 and returns in forty seconds. The dozen venue pulls run a few hundred dollars and take two or three days, most of that spent waiting on clerks who still answer the phone themselves.
Only one of those two products can be defended in a deposition. Financial statements have the same property, which is why what gets reported and what gets found so rarely match.
Some records stay out of reach no matter how the venue list is built. Florida seals under Fla. Stat. § 943.059 and expunges under § 943.0585, and a properly expunged record leaves the public index entirely. Juvenile matters, sealed family files, and certain diversion outcomes behave the same way. Write that limit into the report in plain language. Naming what a method cannot see is what separates work product from marketing.
Your last clean report can be checked in a day
Pull the most recent background report you accepted with a clean litigation result and look for the sentence listing which courts were searched and back to what year. If there isn’t one, call the vendor and ask which counties in the subject’s residence history were covered, and what date each of those indexes begins. A firm that does real venue work answers in an hour from its own file. A firm reselling a database query will take a week and come back with a paragraph about proprietary sources.
You will know which one you bought.
Farsight Intelligence builds the venue list from the subject’s actual history, pulls the file instead of the summary line, and tells you in writing where the record could not reach. If you need to know what a counterparty has been sued for, and where, start at brettfl.com, book time at meet.brettfl.com, or write me directly at [email protected].
Coverage first. Then conclusions.