Tech Arrests the Legal System

While brainstorming what to write about for this week’s post, I wanted to explore something that I had never learned about yet was interested in. Law has always fascinated me and I’ve considered attending law school (definitely pending!). I decided why not research the intersection between the practice of law and technology? The legal and justice system is such an integral part of our society that technology and innovation has such an ability to transform. This blog post will cover how technology has affected law and predictions on how law will be affected in the future.

When we think of AI-replacing-jobstechnology replacing jobs, I think most people’s first thoughts gravitate towards low-level factory and warehouse jobs dealing with inventory and manual labor. I had never thought of extremely high level jobs requiring years of education, such as doctors and lawyers, as being replaceable. However, in the book that I read over break entitled The Inevitable, by Kevin Kelly, he mentioned the possibility/probability of algorithms replacing doctors, specifically with the diagnostic portion of their profession. It seems that if doctors (or at least portions of their role) can be replaced, anyone is susceptible to the technology takeover. Let’s investigate the law profession and see what is possible and nearly improbable for this industry.

The consequences that occur due to the intersection of technology and law are entirely up to its users – anyone with a role in the law and justice system. Whether this be attorneys, courts, or clients, technology can be used to better the legal process or worsen it. It all depends on the human element.

The law sector has been one of the slowest industries to adopt technology. However, here are the technologies that have been previously adapted and will be adapted in the future.

Two Current Disruptors

Seedlegalsseedlegals.jpeg

Seedlegals is the first legal automated platform that assists start-ups in the funding process and completely cuts the need for lawyers in the funding process. Instead of hiring lawyers, you hire Seedlegals.

Seedlegals decided to target the tedious realm of contracts. Contracts are an area of a lawyers’ work that involve a lot of time, however, not a lot of creativity because they are easily replicable. Contracts have a formulaic protocol. While the specific terms and various components of the document obviously changes from deal to deal and company to company, the main format and general terms remain relatively similar. Yet despite this commonality across all contracts, startups face huge fees when paying lawyers to form these contracts. This is where Seedlegals found their opportunity. Why pay extraordinary amounts of money and wait extraordinary amounts of time for lawyers to create these individual custom contracts when there can be a cloud-based platform that automates the process? Seedlegals cites that their process can cut the duration of startup funding rounds by 80%. Sounds like a good deal.

Seedlegals works by allowing startups to provide key information about their company (i.e. valuation, shareholders, amount you are hoping to acquire, etc.) and then Seedlegals takes care of the rest of the legal process by allowing you to easily create, negotiate, and sign everything required to complete the entire legal process online. They assist in creating a term sheet, shareholders agreement, hire new members, build a relationship with shareholders, and close the funding round. Using prior formatting, formulas, and inputs, Seedlegals utilizes its data-driven platform and then creates these outputs listed above. They assist startups to completely bypass hiring a lawyer in the first place, therefore, cutting time and costs.

Lexoo

lexoo.png

Lexoo is the “Uber of lawyers.” In this case, technology helps pair possible clients with existing lawyers instead of cutting out the need for lawyers, as Seedlegals does by cutting out the need for lawyers to individually write contracts and various negotiation agreements. Lexoo is a data driven platform that matches clients to lawyers and adheres to their “philosophy of efficiency, transparency, and cost-certainty.”

Lexoo sought to fix three main problems the law sector currently faces: lack of price clarity, no access to reviews of other clients’ experiences, and no reasons or incentives for law firms to innovate and improve.

Most lawyers in large firms bill by the hour. This process can drag out the legal process because there is no motive to complete tasks as quickly as possible because the longer they work – the more they get paid. This prevents efficiency in the firm and legal process as a whole because why create technology that could decrease your billable hours? Lexoo solves this by offering fixed prices, depending on the various legal services, in order to give clearer price transparency and erase the previous vagueness relating to legal pricing.

When clients are not able to review various lawyers in a way accessible to other potential clients, this leads to a sub prime experience for two reasons. The first is that clients may not choose the attorney best suited for the jobs because they have no knowledge of their previous work and other clients’ experiences with said attorney. Second, lawyers don’t have as much incentive to provide the best possible services and customer experience because there is no way for clients to “tell on them,” so to speak. Lexoo solves this issue by allowing a platform for clients to speak about their attorneys, thus both preventing malpractice and unfair processes and incentivizing attorneys to go above and beyond in their experiences.

Lexoo promotes efficiency and hence technology because of the fact it eradicates billing by the hour. Because lawyers have fixed prices, Lexoo promotes lawyers to utilize various AI legal services in order to maximize productivity. All of Lexoo’s three goals in their philosophy are met through this platform.

Lexoo vets all incoming lawyers and makes sure their qualifications are up to company standards. Most Lexoo lawyers were previous senior level lawyers at big firms. Once cleared, three or four lawyers are matched up with a client request, obtained through data and algorithms that predict which lawyer has the most knowledge/success about this certain legal realm. Once chosen, those lawyers give the client a quote and the client can choose which lawyer they would like to hire. Throughout the whole process, only the lawyers given the opportunity to quote are able to view the client’s case and information, therefore, guaranteeing client confidentiality throughout the platform – an obviously imperative part of law practice.

Conclusion

Both Seedlegals and Lexoo display the incredible power of technology both in the legal ecosystem and on human society as a whole. By utilizing AI, cloud computing, and database platforms, lawyers can become better lawyers and therefore, make the justice system and legal world more efficient and useful to all.

What implications do you think the legal world will face from disruptive technology – whether positive or negative?

Additionally, with legal data being stored on the cloud, there are numerous ethical implications due to client confidentiality. What are your thoughts on how the legality of confidentiality and privacy relates to data storage on the cloud?

Sources

SeedLegals’ automation aims to replace lawyers in startup funding rounds

https://www.lexoo.co.uk/about-us

https://uk.practicallaw.thomsonreuters.com/9-639-3110?__lrTS=20180219175502023&transitionType=Default&contextData=(sc.Default)&firstPage=true&bhcp=1

 

9 thoughts on “Tech Arrests the Legal System

  1. Creative idea for a post! Its true technology is infiltrating every industry, and I’ve never thought about the law sector’s slow adoption. I think my favorite company you mentioned is Lexoo, for its dedication to promoting transparency in the industry. Though I’m skeptical how much of an impact it will have for at least the time being, as the fixed price policy would likely not draw in many lawyers who are accustomed to their pay by the hour rates.

    Also interesting what you brought up about security and client confidentiality. I wonder if any of these disruptive technologies will try to leverage Blockchain technology for a more secure platform to store confidential information?

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  2. Great post! In the book “Machine Crowd Platform,” the authors are actually in favor of the idea of AI replacing some types of judges. Studies have proven that judges’ rulings are very inconsistent, differing greatly from the early morning compared to after lunch, and that isn’t even including prejudices that all humans naturally have. It’d definitely be off putting to have a robot review your case, but interestingly, it’d be statistically be much more fair.

    Liked by 1 person

  3. Fascinating post, Ellen! I had never thought of the legal system as an industry ripe for technological integration, but your section on Lexoo definitely points out the room for improvement.

    I had never heard of Seedlegals, but I love how the business model works to empower other startups with tools and infrastructure to help them succeed, similar to the female-founded Lumi and Shippo that Julia mentioned! I bet startups often find themselves buried in a mountain of legal jargon and contract paperwork, so utilizing a platform like Seedlegals could significantly boost a startup.

    Also, as Alex pointed out, it will be interesting to see how the evolution of AI affects law and justice, especially if it can be smoothly integrated into the current judicial system!

    Liked by 2 people

  4. Really loved this post Ellen! I was thinking that the “uber for…” platform could never be applied to these highly skilled positions, but you showed how pretty much every profession can be disrupted by tech. I think the clarity on pricing and increase in speed is really important, and will be a huge competitive advantage over traditional methods.

    I don’t see the day that legal argument is ever performed by AI. However, I never saw the day that IBM Watson would be more accurate in diagnosis than a doctor is so it could be coming!

    Liked by 1 person

  5. Really interesting post, Ellen! I’m working on a startup and finding [human] legal help has been very tricky, so I’ve been referred to many of these online legal services that eliminate the need of actual lawyers! [Note: I finally had the opportunity to meet law professionals last week and they claimed that “you can’t generalize your company/product like the online services do.” Hmmm. Haha.]

    I think that technology could be integrated to help lawyers improve their services, whether it be improving their ability to analyze [insert law responsibility here] or something like that. As @johnreimblog mentioned in his comment and you touched on with the medical field, doctors are now using AI to help with diagnosis. In a TedTalk, a doctor touched on a time that AI diagnosed the patient’s stage 4 melanoma that he would’ve missed. It seemed that the doctor was grateful for the technology and did not feel competitive that AI was more accurate, rather it just helped him with his job. I am curious to see how technology will evolve in the legal field and whether the legal professionals will be as willing and humble to accept the integration of technology.

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  6. I loved this post, Ellen! In a country that’s as obsessed with litigation as the United States, technologies such as these will absolutely have a place. These are surely just the beginning for our justice system and I’m excited to see how they are implemented in the future. I think judges and the decision-making process are ripe for disruption considering how variable they can be. I’m curious as to how they will be rolled out in other countries, as the systems and cultures are vastly different.

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  7. Nice post. I definitely think that AI can disrupt much of the legal profession (particularly paralegals). Of course, the new technologies also creates opportunities, since disruption also leads to all sorts of new liability for companies, etc.

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  8. This is an awesome post! I haven’t heard of either of these companies, but I just bookmarked your post in the event I find myself needing them one day 😉

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  9. Awesome post, Ellen!
    Ever since I first learned about blockchain and its potential for creating smart contracts, I texted my dad (who is a lawyer) to watch out! It is quite possible for his job to be disrupted by new technological solutions cutting out the middlemen.
    Another cool company moving into the legal/technological space is DoNotPay. Started by Joshua Browder when he was just 17, DoNotPay is an AI-powered chatbot meant to help people file and win parking-ticket appeals. Now it has expanded helping people sue Equifax for negligence for up to $25,000 and will begin handling divorce proceedings. And it is all online-wild!

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