By not highlighting anything on your first pass, you also save time in the long run when you outline. When you outline, you return to a case a few weeks after you first read it. With unnecessary highlighting, you end up spending a lot of time rereading to find out what is relevant in a given case. On your second pass through the case, identify the relevant sections and highlight the issue , rule , facts, analysis , policy, procedural history and other elements. Identify the elements with a notation in the margin.
Some students use different colored highlighters to identify different elements.
One color is used for the rule, another for the issue, and so on. This usually works well only for highly visual people. For myself, I find that different colors slow you down and only add to the confusion of too much highlighting. As in all things, if it works for you and adds to your productivity and efficiency, then do it. Otherwise, eliminating the clutter will speed you along your way.