JBIG2 is not the problem. It is perfectly possible to do lossless compression with JBIG2. They just set its options to do some overly aggressive compression.
I would wager JBIG2 is the problem when Xerox couldn't implement it properly.
"Normal" is an overly aggressive compression setting? Is that an overly aggressive setting for the end-user or for Xerox to be implementing in their hardware marketed to law firms?
"Normal" is an overly aggressive compression setting? Is that an overly aggressive setting for the end-user or for Xerox to be implementing in their hardware marketed to law firms?