UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                                 _______________

                                   FORM 10-QSB

             [X]     QUARTERLY REPORT UNDER SECTION 13 OR 15(D)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                     FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2004

                                       OR

             [_]    TRANSITION REPORT UNDER SECTION 13 OR 15(D)
                               OF THE EXCHANGE ACT

                              ____________________

                         Commission File Number 1-07149

                               ITIS HOLDINGS INC.
        (Exact name of small business issuer as specified in its charter)


          NEVADA                                   74-3069407
          (State or other jurisdiction of          (I.R.S. Employer
          incorporation or organization)           Identification No.)

     12000 WESTHEIMER, HOUSTON, TEXAS                77077
     (Address of principal executive office)       (Zip Code)

                    Issuer's telephone number: (281) 600-6000

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding  12  months  (or  for such shorter period that the registrant was
required  to  file  such  reports),  and  (2)  has  been  subject to such filing
requirements  for  the  past  90  days.
Yes  [X]  No  [

The number of shares of the issuer's common stock outstanding as of August  16,
2004 was 5,495,743.

Transitional Small Business Disclosure Format (Check One): Yes     No X
                                                              ---    ---


<PAGE>
                               ITIS HOLDINGS INC.

                                   FORM 10-QSB

                          FOR THE QUARTER JUNE 30, 2004

                                      INDEX

                                                                     PAGE
                                                                     ----

PART I -- FINANCIAL INFORMATION

Item 1.   Financial Statements . . . . . . . . . . . . . . . . . . . .  3

Item 2.   Management's Discussion and Analysis Or Plan of Operation .   9

Item 3.   Controls and Procedures . . . . . . . . . . . . . . . . . .  13

SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   14


                                        2
<PAGE>
<TABLE>
<CAPTION>
ITIS HOLDINGS INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
JUNE 30, 2004 (UNAUDITED)

                                     ASSETS
Current assets:
<S>                                                                               <C>
     Cash and cash equivalents                                                    $      9,848
     Accounts receivable, net                                                           66,726
     Note receivable-current portion                                                   480,000
     Investments available for sale, at fair market value                               21,350
     Other current assets                                                               54,926
                                                                                  -------------
          Total current assets                                                         632,850
                                                                                  -------------

Note receivable, net of current portion                                                920,160
Other long term assets                                                                  92,690
Fixed assets, net of depreciation                                                       74,739
                                                                                  -------------

          Total assets                                                            $  1,720,439
                                                                                  =============

LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities:
     Notes payable-other                                                          $    492,214
     Disputed note to Cootes Drive LLC                                                 500,000
     Accounts payable                                                                  361,923
     Accounts payable-related parties                                                  769,433
     Accrued interest-related parties                                                1,467,603
     Accrued liabilities                                                                53,474
     Series A Convertible Preferred stock, par value $.001;
          50,000,000 shares authorized; 161.08 shares issued and outstanding         2,027,526
                                                                                  -------------
          Total current liabilities                                                  5,672,173
     Long term notes payable to Chairman                                             2,150,117
     Long term notes payable to Directors                                            2,022,500
                                                                                  -------------
Total liabilities                                                                    9,844,790
                                                                                  -------------

Commitments and contingencies

Stockholders' deficit:
     Common stock, par value $.001, 150,000,000 shares
          authorized;  5,697,450 shares issued and 5,495,743 shares outstanding          5,697
     Additional paid in capital                                                     29,364,436
     Accumulated deficit                                                           (37,032,329)
     Treasury stock, at cost, 201,707 shares                                          (323,127)
     Accumulated other comprehensive income,
          unrealized loss on investments                                              (139,028)
                                                                                  -------------
          Total stockholders' deficit                                               (8,124,351)
                                                                                  -------------

          Total liabilities and stockholders' deficit                             $  1,720,439
                                                                                  =============
</TABLE>


                                        3
<PAGE>
<TABLE>
<CAPTION>
ITIS HOLDINGS INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
(Unaudited)

                                               For the six months ended June 30,       For the three months ended June 30,
                                                    2004                2003               2004                  2003
                                            --------------------  ----------------  -------------------  --------------------
                                                                     (restated)                               (restated)
<S>                                         <C>                   <C>               <C>                  <C>
REVENUE, NET OF DEFERRED INCOME
   Automated litigation support services    $            35,000   $       336,645   $                -   $           232,847
   Database management sales and services                     -            46,066                    -                14,726
   Pharmaceutical sales                                 148,470           143,437               60,959                86,614
                                            --------------------  ----------------  -------------------  --------------------
   Total revenues                                       183,470           526,148               60,959               334,187
                                            --------------------  ----------------  -------------------  --------------------

OPERATING EXPENSES:
   Cost of sales-pharmaceuticals                        120,754           108,283               55,526                66,922
   Selling and marketing                                 19,936            64,062                7,936                24,835
   General and administrative                           557,159         1,210,100              301,838               599,201
   Production and computer service                       23,328           283,475                6,216               161,264
   Amortization and depreciation                         72,118           148,146               52,981                76,335
                                            --------------------  ----------------  -------------------  --------------------
   Total operating expenses                             793,295         1,814,066              424,497               928,557
                                            --------------------  ----------------  -------------------  --------------------

LOSS FROM OPERATIONS                                   (609,825)       (1,287,918)            (363,538)             (594,370)

DISCONTINUED OPERATIONS
   Loss on disposal of business segments                      -        (2,595,652)                   -            (2,595,652)

INTEREST INCOME                                         101,759            24,606               50,428                17,820
INTEREST EXPENSE                                       (164,848)         (480,463)             (82,117)             (240,996)
GAIN ON SALE OF INVESTMENTS
   AND EQUIPMENT                                              -           192,378                    -                  (617)
                                            --------------------  ----------------  -------------------  --------------------

NET LOSS                                               (672,914)       (4,147,049)            (395,227)           (3,413,815)

OTHER COMPREHENSIVE GAIN (LOSS)
   Unrealized loss on investments
      available for sale                                (48,576)         (103,624)             (60,310)              (25,493)
                                            --------------------  ----------------  -------------------  --------------------

NET AND COMPREHENSIVE LOSS                  $          (721,490)  $    (4,250,673)  $         (455,537)  $        (3,439,308)
                                            ====================  ================  ===================  ====================

LOSS PER COMMON SHARE                       $             (0.13)  $         (0.82)  $            (0.08)  $             (0.66)
                                            ====================  ================  ===================  ====================
WEIGHTED AVERAGE SHARES USED IN
   COMPUTING LOSS PER
   COMMON SHARE                                       5,495,743         5,201,941            5,495,743             5,240,955
                                            ====================  ================  ===================  ====================
</TABLE>


                                        4
<PAGE>
<TABLE>
<CAPTION>
ITIS HOLDINGS INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOW
(Unaudited)

                                                     For the six months ended June 30,
                                                         2004                 2003
                                                  -------------------  ------------------
                                                                           (restated)
<S>                                               <C>                  <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
   Net loss                                       $         (672,914)  $      (4,147,049)
   Adjustments to reconcile net loss to net
      cash used in operating activities:
      Issuance of common stock, options,
         or warrants for goods or services                         -               8,000
      Amortization and depreciation                           72,118             148,146
      Gain on sales of investments                                 -            (192,995)
      Loss on sale of equipment                                    -                 617
      Loss on sale of database                                     -           2,595,652
      Changes in:
         Accounts receivable                                   7,269            (109,895)
         Accrued interest on notes receivable                      -                (983)
         Inventory                                            34,823               7,118
         Other assets                                         17,031             (60,835)
         Accounts payable                                     16,871              18,527
         Accrued liabilities                                  80,261             453,880
         Deferred revenue                                          -            (153,755)
                                                  -------------------  ------------------

      Net cash used in operating activities                 (444,541)         (1,433,572)
                                                  -------------------  ------------------

CASH FLOWS FROM INVESTMENT ACTIVITIES:
   Payments received on notes receivable                     158,144              58,287
   Purchase of treasury stock                                      -              (2,250)
   Purchase of licensing agreement                                 -             (25,000)
   Proceeds from sale of investments                               -             546,827
   Proceeds from sale of equipment                                 -                 750
   Proceeds from sale of database                                  -             400,183
   Additions to furniture and equipment                            -              (6,307)
                                                  -------------------  ------------------

      Net cash provided by investment activities             158,144             972,490
                                                  -------------------  ------------------

CASH FLOWS FROM FINANCING ACTIVITIES:
   Proceeds from notes payable                               325,000             126,061
   Advances from related parties                              36,115             372,769
   Payments on notes payable                                (175,846)           (258,392)
                                                  -------------------  ------------------

      Net cash provided by financing activities              185,269             240,438
                                                  -------------------  ------------------

NET DECREASE IN CASH AND CASH
   EQUIVALENTS                                              (101,128)           (220,644)

CASH AND CASH EQUIVALENTS, beginning of period               110,976             248,722
                                                  -------------------  ------------------

CASH AND CASH EQUIVALENTS, end of period          $            9,848   $          28,078
                                                  ===================  ==================
</TABLE>


                                        5
<PAGE>
ITIS HOLDINGS INC. AND SUBSIDIARIES
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1-BASIS OF PRESENTATION:

The accompanying unaudited interim consolidated financial statements of ITIS
Holdings Inc. ("ITIS") have been prepared in accordance with accounting
principles generally accepted in the United States of America and the rules of
the Securities and Exchange Commission ("SEC"), and should be read in
conjunction with the audited financial statements and notes thereto contained
ITIS's Annual Report filed with the SEC on Form 10-KSB. In the opinion of
management, all adjustments, consisting of normal recurring adjustments,
necessary for a fair presentation of financial position and the results of
operations for the interim periods presented have been reflected herein. The
results of operations for interim periods are not necessarily indicative of the
results to be expected for the full year. Notes to the financial statements that
would substantially duplicate the disclosure contained in the audited financial
statements for 2003 as reported in the 10-KSB have been omitted.

NOTE 2-RESTATEMENT OF PREVIOUSLY REPORTED STATEMENT OF OPERATIONS

ITIS recognized revenue from services performed by its litigation support
division based on agreements signed prior to December 31, 2002 with its largest
customer. Subsequent to December 31, 2002, management received an agreement in
April 2003 that asserted the payment for the services performed by ITIS were
contingent upon the customer collecting for such services. Management disputes
the alleged agreement; however, management has determined that based on the
contingency and lack of collection, revenue should not have been recognized and
has restated revenues for the three and six months ended June 30, 2003.

A summary of the restatement follows:

<TABLE>
<CAPTION>
                                               For the six months ended                     For the three months ended
                                                    June 30, 2003                                June 30, 2003
                                     -------------------------------------------  -------------------------------------------
                                      As previously   Restatement        As        As previously   Restatement        As
                                        reported      adjustments     restated       reported      adjustments     restated
                                     ---------------  ------------  ------------  ---------------  ------------  ------------
<S>                                  <C>              <C>           <C>           <C>              <C>           <C>
Revenues                             $      935,776      (409,628)  $   526,148   $      346,690       (12,503)  $   334,187
Net loss attributable to common
   shareholders                      $   (3,841,045)     (409,628)  $(4,250,673)  $   (3,426,805)      (12,503)  $(3,439,308)
Basic and diluted loss attributable
   to common shareholders per
   common share                      $        (0.74)        (0.08)  $     (0.82)  $        (0.65)        (0.01)  $     (0.66)
</TABLE>

NOTE 3-STOCK-BASED COMPENSATION:

Compensation is recorded for stock-based compensation grants based on the excess
of the estimated fair value of the common stock on the measurement date over the
exercise price. Additionally, for stock-based compensation grants to
consultants, ITIS recognizes as compensation expense the fair value of such
grants as calculated pursuant to SFAS No. 123, recognized over the related
service period. SFAS No. 148 requires companies to disclose proforma results of
the estimated effect on net income and earnings per share to reflect application
of the fair value recognition provision of SFAS No. 123.


                                        6
<PAGE>
<TABLE>
<CAPTION>
                                      For the six months ended June 30,        For the three months ended June 30,
                                          2004                2003                 2004                  2003
                                   ------------------  -------------------  -------------------  --------------------
                                                           (restated)                                 (restated)
<S>                                <C>                 <C>                  <C>                  <C>
Net loss applicable
  to common shareholders:
      As reported:                 $        (672,914)  $       (4,147,049)  $         (395,227)  $        (3,413,815)
      Less: compensation expense
        charged to income:                         -                8,000                    -                 8,000
      Plus: proforma compensation
        expense:                                   -               (8,000)                   -                (8,000)
                                   ------------------  -------------------  -------------------  --------------------
Proforma net loss applicable
  to common shareholders:          $        (672,914)  $       (4,147,049)  $         (395,227)  $        (3,413,815)
                                   ==================  ===================  ===================  ====================
Basic loss per common share:
      As reported:                 $           (0.13)  $            (0.82)  $            (0.08)  $             (0.66)
      Proforma:                    $           (0.13)  $            (0.82)  $            (0.08)  $             (0.66)
</TABLE>

NOTE 4-BUSINESS SEGMENTS:

ITIS Holdings owns subsidiaries that provide automated litigation support and
document and Database management, that operate pharmacies, and that provide
technical support for operations.

<TABLE>
<CAPTION>
                                            SEGMENT INFORMATION
                                           -----------------------

SIX MONTHS ENDED                            LOSS FROM    INTEREST     TOTAL     DEPRECIATION/
JUNE 30, 2004                  NET SALES    OPERATIONS    EXPENSE     ASSETS     AMORTIZATION
-----------------------------  ----------  ------------  ---------  ----------  --------------
<S>                            <C>         <C>           <C>        <C>         <C>
Automated Litigation Support   $   35,000  $  (132,816)  $  84,843  $  102,380  $       29,204
Database Management                     -      (71,030)     80,005   1,515,047          27,138
Pharmacy Operations               148,470     (405,979)          -     103,012          15,776
                               ----------  ------------  ---------  ----------  --------------
Total, ITIS Holdings Inc.      $  183,470  $  (609,825)  $ 164,848  $1,720,439  $       72,118
                               ==========  ============  =========  ==========  ==============

SIX MONTHS ENDED                           LOSS FROM     INTEREST   TOTAL       DEPRECIATION/
JUNE 30, 2003 (RESTATED)       NET SALES   OPERATIONS    EXPENSE    ASSETS      AMORTIZATION
-----------------------------  ----------  ------------  ---------  ----------  --------------
Automated Litigation Support   $  336,645  $  (520,368)  $ 229,203  $  684,772  $       19,377
Database Management                46,066     (323,341)     74,998   1,884,101         106,753
Pharmacy Operations               143,437     (444,209)    176,262     478,412          22,016
                               ----------  ------------  ---------  ----------  --------------
Total, ITIS Holdings Inc.      $  526,148  $(1,287,918)  $ 480,463  $3,047,285  $      148,146
                               ==========  ============  =========  ==========  ==============

THREE MONTHS ENDED                         LOSS FROM     INTEREST   TOTAL       DEPRECIATION/
JUNE 30, 2004                  NET SALES   OPERATIONS    EXPENSE    ASSETS      AMORTIZATION
-----------------------------  ----------  ------------  ---------  ----------  --------------
Automated Litigation Support   $        -  $   (71,509)  $  43,662  $  102,380  $       19,749
Database Management                     -      (39,779)     38,455   1,515,047          19,684
Pharmacy Operations                60,959     (252,250)                103,012          13,548
                               ----------  ------------  ---------  ----------  --------------
Total, ITIS Holdings Inc.      $   60,959  $  (363,538)  $  82,117  $1,720,439  $       52,981
                               ==========  ============  =========  ==========  ==============

THREE MONTHS ENDED                         LOSS FROM     INTEREST   TOTAL       DEPRECIATION/
JUNE 30, 2003 (RESTATED)       NET SALES   OPERATIONS    EXPENSE    ASSETS      AMORTIZATION
-----------------------------  ----------  ------------  ---------  ----------  --------------
Automated Litigation Support   $  232,847  $  (201,177)  $ 112,873  $  684,772  $        9,681
Database Management                14,726     (173,945)     44,542   1,884,101          53,279
Pharmacy Operations                86,614     (219,248)     83,581     478,412          13,375
                               ----------  ------------  ---------  ----------  --------------
Total, ITIS Holdings Inc.      $  334,187  $  (594,370)  $ 240,996  $3,047,285  $       76,335
                               ==========  ============  =========  ==========  ==============
</TABLE>


                                        7
<PAGE>
NOTE 5-NOTES PAYABLE AND FINANCING AGREEMENTS:

On March 15, 2004, ITIS Inc. dba Litidex(R) and National Law Library executed a
new promissory note for $307,451 to Houston RPM, L.C. This note refinanced
$207,451 of the note dated December 2, 2003, and provided $100,000 in new
funding to National Law Library. The note bears interest at 18% per year, and is
secured by assignment of the Asset Purchase Agreement between National Law
Library, Brief Reporter and Jurisearch Holdings, LLC dated August 16, 2002. The
amount of each monthly installment shall equal payments received pursuant to the
Asset Purchase Agreement, but in no event shall the payment be less than $32,500
per month. Any unpaid principal and interest is due in full on November 15,
2004.

On May 4, 2004, ITIS subsidiary National Law Library executed a promissory note
for $100,000 to Frost National Bank, Houston, Texas. The note bears interest at
4.5% and is payable in one principal payment plus accrued interest on August 2,
2004.

On June 17, 2004, ITIS subsidiary National Law Library executed a promissory
note for $125,000 to Frost National Bank, Houston, Texas. The note bears
interest at 4.5% and is payable in one principal payment plus accrued interest
on September 17, 2004. Hunter Carr, Chief Executive Officer of ITIS, personally
guarantees and has provided personal assets as collateral for this note payable.

NOTE 6-RETAIL STORE CLOSING

On June 1, 2004, ITIS subsidiary PharmHouse closed its pharmacy location in
Rosenberg, Texas and transferred and sold the inventory of pharmaceuticals at
its cost basis of $27,141 to the pharmacist in charge at that location.
PharmHouse is currently negotiating the potential sale of a majority equity
interest in PharmHouse and assisting in the opening of a new, as yet
undetermined pharmacy location.

NOTE 7-SUBSEQUENT EVENTS

On August 2, 2004, the May 4, 2004 National Law Library note payable to Frost
National Bank for $100,000 was renewed. Under the terms of the new note, the
entire principal amount plus any accrued and unpaid interest is due on August 1,
2005. The new note has a variable interest rate of .50 percentage points over
the prime rate of Frost National Bank, resulting in an initial interest rate of
4.75%.  Interest is payable monthly. Hunter Carr, Chief Executive Officer of
ITIS, personally guarantees and has provided personal assets as collateral for
this note payable.


                                        8
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

The following discussion should be read in conjunction with the condensed,
consolidated financial statements of ITIS, which are included elsewhere in this
Form 10-QSB.  Included in this discussion are certain forward-looking statements
regarding ITIS's expectations for its business and its capital resources.   The
reader should not rely on forward-looking statements because they are subject to
known and unknown risks, uncertainties and other factors that may cause our
actual results to differ materially from those contemplated by the
forward-looking statements. ITIS and its subsidiaries may experience high
volatility in operating results and cash flows from quarter to quarter and from
year to year.

Management realizes that anticipated revenues to be generated by the automated
litigation support services of Litidex and the PharmHouse stores will be
critical in providing some of the funds necessary to continue company operations
and to remain in business. Our expense levels are based, in part, on our
expectations as to future revenues. To the extent that revenues are below
expectations, we may be unable or unwilling to reduce expenses proportionately,
and operating results and cash flows are likely to be adversely affected.

The reader of the following discussion of the results of our operations and
liquidity and capital resources should be aware of critical accounting policies
applied by management as follows:

     -    Note receivable at June 30, 2004 in the amount of $1,400,160,
          represents receivables related to the sale of National Law Library
          assets and Brief Reporter. Because we believe all such amounts are
          collectible due to the nature of the agreements and our collection
          experience with the payers, we have not recorded an allowance for
          doubtful accounts for this receivable. The long-term portion
          represents the amounts we estimate will not be paid to us within the
          next twelve months, discounted by 12%.

     -    On July 29, 2002 ITIS entered into an Asset Purchase Agreement with
          American Legal Data, LLC, a Delaware limited liability company
          (Buyer). Under the terms of the Purchase Agreement, ITIS sold to Buyer
          all right, title and interest in one complete copy of data consisting
          of an electronic form of federal and state constitutions, statutes,
          regulations, case law, rules and legal briefs, together with
          additions, derivations and updates, as it existed on July 29, 2002. In
          consideration for these assets, Buyer agreed to pay to ITIS $2
          million, of which $25,000 was paid in 2001 and $66,000 was paid at or
          prior to closing on July 29, 2002. The balance of the consideration
          ($1,909,000) is payable in minimum monthly installments of $16,000 for
          120 months beginning August 16, 2002. Unpaid principal accrues
          interest at the rate of 8% per year, and in the 121st month following
          the closing date, Buyer will make a lump sum payment equal to the
          outstanding principal and any accumulated interest. On February 24,
          2003, ITIS agreed to move seven monthly payments of $16,000 ($112,000)
          to the lump sum payment due at the end of the note. At June 30, 2004,
          the principal balance owed by American Legal Data was $1,892,481 and
          they were delinquent in payments due for May and June 2004. American
          Legal Data has assured us they will resume making payments in the
          third quarter of 2004.

          Based on the guidelines of SEC Staff Accounting Bulletin No. 101,
          Revenue Recognition in Financial Statements, it is the opinion of
          management that the installment method of accounting is appropriate
          for this sale, as uncertainty exists as to the ultimate collectibility
          of the sale price. Accordingly, management has provided for deferred
          gross profit in an amount equal to the outstanding balance of the note
          receivable at June 30, 2004 or $1,892,481. Principal and interest
          payments on the note receivable will be


                                        9
<PAGE>
          recorded as income, and a reduction for the principal amount will be
          recorded to the note receivable and deferred gross profit, as future
          payments are received.

     -    The Company is not party to any off balance sheet arrangements.

The following is management's discussion and analysis of certain significant
factors that have affected ITIS's financial condition and results of operations
during the three and six months ending June 30, 2004 and 2003.

RESULTS OF OPERATIONS

Revenues.  Revenues decreased by $342,678 to $183,470 during the six months
ended June 30, 2004, from $526,148 recorded for the six months ended June 30,
2003. Revenues also decreased by $273,228 to $60,959 for the quarter ended June
30, 2004, from $334,187 for the quarter ended June 30, 2003. Revenues from the
automated litigation support services of subsidiary Litidex(R) decreased by
$301,645 and $232,847 for the six months and quarter ended June 30, 2004,
respectively. As an indirect result of the July 7, 2003 dismissal of our claims
against Southridge Capital Management LLC and others, production and receipts
related to the Litidex(R) have decreased significantly. At the present time, our
litigation support services are temporarily suspended as we attempt to
renegotiate our service contracts. While revenues generated by pharmacy
operations increased by $5,033 for the six months ended June 30, 2004 compared
to the six months ended June 30, 2003, pharmacy revenues decreased by $25,655
for the quarter ended June 30, 2004 as compared to the corresponding period in
2003. On June 1, 2004, ITIS subsidiary PharmHouse closed its pharmacy location
in Rosenberg, Texas and temporarily suspended PharmHouse operations pending the
potential sale of a partial equity interest in PharmHouse and the opening of a
new pharmacy location. There were no revenues from database management services
in the six months or quarter ended June 30, 2004 as compared to $46,066 and
$14,726 for the six months and quarter ended June 30, 2003, respectively.

Cost of Sales. Cost of sales increased by $12,471 to $120,754 for the six months
ended June 30, 2004 from $108,283 for the six months ended June 30, 2003. Cost
of sales decreased by $11,396 to $55,526 for the quarter ended June 30, 2004
from $66,922 for the quarter ended June 30, 2003. Cost of sales directly relates
to sales of pharmaceutical products sold by subsidiary PharmHouse.

Sales and Marketing Expense. Sales and marketing expense decreased by $44,126
and $16,899 to $19,936 and $7,936 for the six months and quarter ended June 30,
2004, respectively, from $64,062 and $24,835 for the six months and quarter
ended June 30, 2003.  The decrease is primarily due to decreased contract
marketing personnel and telephone expenses.

General and Administrative Expense. General and administrative expense decreased
by $652,941 to $557,159 for the six months ended June 30, 2004, from $1,210,100
for the six months ended June 30, 2003. General and administrative expense also
decreased by $297,363 to $301,838 for the quarter ended June 30, 2004, from
$599,201 for the quarter ended June 30, 2003. These decreases are a result of
the following:

     -    Payroll and related costs at the administrative and management level
          decreased by $514,818 and $274,141for the six months and quarter ended
          June 30, 2004, respectively as compared to the six months and quarter
          ended June 30, 2003.

     -    The expense of professional fees, contract services, and outside
          consulting services increased in aggregate by $12,861 and $70,565 for
          the six months and quarter ended June 30, 2004, respectively, as
          compared to the six months and quarter ended June 30, 2003. The
          majority of the increased expense is due to increased legal fees
          relating to the renegotiation of service contracts of subsidiary
          Litidex(R).


                                       10
<PAGE>
     -    Rent, utilities and related expenses decreased by $33,301 and $9,289
          for the six months and quarter ended June 30, 2004, respectively, as
          compared to the six months and quarter ended June 30, 2003.

     -    Miscellaneous other general and administrative expenses were reduced
          by $117,683 and $84,498 for the six months and quarter ended June 30,
          2004, respectively, from the six months and quarter ended June 30,
          2003.

Production and Computer Service Expense.  Production and computer service
expense decreased by $260,147 and $155,048 for the six months and quarter ended
June 30, 2004, respectively, to $23,328 and $6,216, from $283,475 and $161,264
for the six months and quarter ended June 30, 2003. The decrease is due to
decreased production and related costs of automated litigation support
subsidiary Litidex(R).

Amortization and Depreciation Expense.   Amortization and depreciation expense
decreased by $76,028 and $23,354 for the six months and quarter ended June 30,
2004, respectively, to $72,118 and $52,981, from $148,146 and $76,335 for the
six months and quarter ended June 30, 2003. The decrease is primarily due to the
reduction in our capitalized software and other intangibles, which were impaired
to a basis of zero at December 31, 2003.

Interest Expense. Interest expense decreased by $315,615 and $158,879 for the
six months and quarter ended June 30, 2004, respectively, to $164,848 and
$82,117, from $480,463 and $240,996 for the six months and quarter ended June
30, 2003. The majority of the interest expense decrease is due to the
reclassification of a $2,173,500 imputed note payable to Rainmaker Ventures,
Ltd. to additional paid-in-capital at year-end 2003.

LIQUIDITY AND CAPITAL RESOURCES

ITIS's ability to execute its business strategy depends to a significant degree
on its ability to generate an established source of revenues, working capital,
and positive cash flow, and its ability to attract additional capital. ITIS's
principal demands for liquidity are cash for normal operations, funds to support
its automated litigation support segment, and funds for development of
PharmHouse stores.

For the six months ended June 30, 2004, ITIS's cash and cash equivalents
decreased by $101,128 to $9,848 in available cash at June 30, 2004 from the
December 31, 2003 available cash balance of $110,976. ITIS has a working capital
deficit of $5,039,323 at June 30, 2004. Cash used in operating activities was
$444,541, cash provided by investment activities was $158,144, and cash provided
by financing activities was $185,269.

Cash used in operating activities of $444,541 is primarily due to operating
losses. Cash provided by investment activities is due to payments received on
notes receivable in the amount of $158,144. Cash provided by financing
activities of $185,269 is due to new loan proceeds from a third party lender in
the amount of $325,000 and advances from related parties in the amount of
$36,115. These amounts are offset by $175,846 in payments made on various notes
payable.

Accounts receivable, net of doubtful accounts, at June 30, 2004 amounts to
$141,463. Of this amount, $74,737 has been classified as long-term.

Note receivable at June 30, 2004 in the amount of $1,400,160, represents
receivables related to the sale of National Law Library assets and Brief
Reporter. Because we believe all such amounts are collectible due to the nature
of the agreements and our collection experience with the payers, we have not
recorded an allowance for doubtful accounts for these receivables. The long-term
portion represents the amounts we estimate will not be paid to us within the
next twelve months, discounted by 12%.


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The  Company has an unrecorded receivable from American Legal Data, LLC relating
to  the sale of a copy of the National Law Library data. Under the terms of this
sale  agreement,  ITIS is scheduled to receive monthly payments in the amount of
$16,000  for 120 months beginning June 1, 2002. While at June 30, 2004, American
Legal  Data  was  delinquent  in  payments  due for May and June 2004, they have
assured  us  that they will resume making payments in the third quarter of 2004.

On March 15, 2004, ITIS Inc. dba Litidex(R) and National Law Library executed a
new promissory note for $307,451 to Houston RPM, L.C. This note refinanced
$207,451 of a note dated December 2, 2003, and provided $100,000 in new funding
to National Law Library. The note bears interest at 18% per year, and is secured
by assignment of the Asset Purchase Agreement between National Law Library,
Brief Reporter and Jurisearch Holdings, LLC dated August 16, 2002. The amount of
each monthly installment shall equal payments received pursuant to the Asset
Purchase Agreement, but in no event shall the payment be less than $32,500 per
month. Any unpaid principal and interest is due in full on November 15, 2004.

On May 4, 2004, ITIS subsidiary National Law Library executed a promissory note
for $100,000 to Frost National Bank, Houston, Texas. The note bore interest at
4.5% and was originally payable in one principal payment plus accrued interest
on August 2, 2004. On August 2, 2004, this note payable was renewed. Under the
terms of the new note, the entire principal amount plus any accrued and unpaid
interest is due on August 1, 2005. The new note has a variable interest rate of
..50 percentage points over the prime rate of Frost National Bank, resulting in
an initial interest rate of 4.75%.  Interest is payable monthly. Hunter Carr,
Chief Executive Officer of ITIS, personally guarantees and has provided personal
assets as collateral for this note payable.

On June 17, 2004, ITIS subsidiary National Law Library executed a promissory
note for $125,000 to Frost National Bank, Houston, Texas. The note bears
interest at 4.5% and is payable in one principal payment plus accrued interest
on September 17, 2004. Hunter Carr, Chief Executive Officer of ITIS, personally
guarantees and has provided personal assets as collateral for this note payable.

As of June 30, 2004, the total principal amount owed to Hunter Carr, CEO of
ITIS, was $2,150,117. Accrued but unpaid interest amounted to $640,649 at June
30, 2004.

ITIS's financial statements are prepared using principles applicable to a going
concern, which contemplate the realization of assets and liquidation of
liabilities in the normal course of business. We do not at this time have an
established source of revenues, working capital or cash flow to cover operating
costs to allow the Company to remain in business. Management's business plan
realizes that revenues to be generated by the automated litigation support
services of Litidex and the PharmHouse stores are critical in providing some of
the funds necessary to continue company operations and to remain in business.
However, the litigation support services of Litidex(R) are temporarily suspended
as we attempt to renegotiate our service contracts, and the pharmacy operations
of PharmHouse are temporarily suspended pending the potential sale of a partial
equity interest in PharmHouse and the opening of a new pharmacy location. It is
possible that revenues from these subsidiaries may never be sufficient to meet
company needs. Management plans to continue to utilize additional loans from Mr.
Carr (President and Chairman of the Board of Directors of ITIS) and other
directors and investors as long as funds from these sources remain available. If
adequate funding from the operations of Litidex, PharmHouse or other sources is
not available, ITIS will be unable to remain in business.

ITIS may be required to obtain additional financing or equity capital to remain
in business, and that capital, if available, may have provisions that could
further suppress current and future stock prices and cause significant dilution
to current shareholders. Our internally generated cash flows from operations
have historically been insufficient for our cash needs and will continue to for
the


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foreseeable future. While management projects that the internal source of
liquidity may improve, this objective may not be achieved in the near term, if
ever. As of August 16, 2004, sources of external and internal financing are very
limited. It is not expected that the internal source of liquidity will improve
until significant net cash is provided by operating activities (which may not be
achieved), and until such time, ITIS will rely upon external sources for
liquidity. ITIS may not ever become profitable and could fail as a going
concern.

We may in the future experience significant fluctuations in the results of our
operations. Such fluctuations may result in significant volatility in the price
and/or value of ITIS's common stock. Shortfalls in revenues, financing or
capital may adversely and disproportionately affect the results of operations
because a high percentage of current operating expenses are relatively fixed and
are primarily financed through loans and capital contributions. These funds are
not guaranteed and may not continue in the future. Accordingly, management
believes that period-to-period comparisons of results of operations should not
be relied upon as an indication of future results of operations.

ITEM 3. CONTROLS AND PROCEDURES

ITIS has adopted and implemented internal disclosure controls and procedures
designed to provide reasonable assurance that all reportable information will be
recorded, processed, summarized and reported within the time period specified in
the SEC's rules and forms.  Under the supervision and with the participation of
ITIS's management, including ITIS's President and Chief Executive Officer and
ITIS's Controller and Principal Financial Officer, ITIS has evaluated the
effectiveness of the design and operation of its disclosure controls and
procedures pursuant to Exchange Act Rule 13a-15(e) as of the end of the fiscal
quarter covered by this report.  Based on that evaluation, the President and
Chief Executive Officer and the Controller and Principal Financial Officer have
concluded that these disclosure controls and procedures are effective.  There
were no changes in ITIS's internal controls or in other factors during or since
the end of the fiscal quarter covered by this report that have had a material
effect or are reasonably likely to have a material effect on internal controls
subsequent to the end of the fiscal quarter covered by this report.

ITEM 5. OTHER INFORMATION

On June 15, 2004, Walter B. Rae and Kelley V. Kirker resigned from the Board of
Directors, citing personal and health reasons. Remaining Board members are
Chairman of the Board Hunter M. A. Carr, W. Paul Thayer, George A. Roberts, and
W. Allyn Hoaglund.

ITEM 6. REPORTS ON FORM 8-K

The following reports on Form 8-K were filed during the quarter for which this
report is filed:

     None


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                                   SIGNATURES

     In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.


                               ITIS HOLDINGS INC.




August 16, 2004          /s/ Hunter M.A. Carr
                         -------------------------
                              Hunter M.A. Carr
                              President and Chief Executive Officer

                         /s/ Joanna Hoover
                         -------------------------
August 16, 2004               Joanna Hoover
                              Principal Accounting Officer


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