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The Future Is Now for Artificial Intelligence in Legal Practice and Marketing

Posted by LMA International on Apr 10, 2018 5:05:41 PM

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Hear from a legal operations and technology panel on how to utilize AI.

Artificial intelligence (AI) is shaping both the practice and the business of law. Examining what this means for law firms and legal marketers, the 2018 LMA Annual Conference assembled a legal operations and technology panel featuring Kimberly Bell, head of legal operations for Nissan North America, Mark Greene, president of Market Intelligence LLC, and Patrick Fuller, vice president of legal intelligence for ALM. 

While AI tools aren’t replacing lawyers, they are replacing certain types of legal work. Firms that haven’t begun to incorporate emerging technologies are at risk of falling behind. Check out the conference panel’s technology predictions below.

Check out the panel's technology predictions below.

Q. What was one of the first examples of AI’s influence on legal operations that you observed?

Mark Greene (MG): In the beginning, there was e-discovery. People weren’t using the term artificial intelligence yet, but it certainly involved the analysis of big data and replacing what was done by humans with computers.

Kimberly Bell (KB): If I take a snapshot of the past year, for instance, some of the most interesting examples of AI include tools that aggregate court information and help make decisions about counsel based on their success in a particular jurisdiction. There are other AI tools for contract management that help to see when contract expiration dates are approaching or to evaluate other elements of a contract.

Q. Which aspects of law do you see as the most influenced by AI and how might that change in the future?

Patrick Fuller (PF): It will affect both the practice and business of law, but in different ways. On the practice side, it can really be viewed as “augmented intelligence,” as opposed to artificial intelligence. It’s the still the expertise and judgment of the lawyer but applied at internet scale. On the business side, it starts first with how legal services are being procured, and then ultimately delivered. AI allows firms to scale in ways they have historically been unable to, develop residual revenue streams and increase profitability on traditionally low-margin work. Currently, anything with documents or a rules base will be affected, so contract analysis, contract execution, document due diligence, compliance and regulatory, tax, etc. are all ripe for aspects of the practices to be automated.

KB: Another example are the types of tools that proactively look at case filing trends for a business/client and develop a response to a new complaint, and other responsive documents. Not replacing attorneys, but certainly starting the process using a very well-informed and experience-based template. 

PF: It’s not replacing the lawyers but instead replacing certain work that they do, and in some cases, it’s not work that the lawyers want to be doing, anyway. One could make an argument that AI is replacing some of the work that lawyers don’t want to do. That being said, I’m hoping that someone invents an AI application that does my expense reports for me, because I hate doing them.

MG: Ken Grady recently went into a deep dive about the way contracts can bring together AI and blockchain. A contract is just a set of rules – if this happens, then that happens – and that’s very compatible with blockchain. Once we get standardized clauses for various purposes, an AI system can pull together the appropriate clauses for a situation, so the contract self-assembles and is reviewed by an attorney before it’s finalized. The execution of the contract is tracked by software, so when you pay this fee, then this lease is executed, or when somebody does this action, a suit is brought. It uses the IFTTT logic with the agreed-upon conditions, which is exactly what blockchain is so great at. I don’t think this is very far off. There’s a law firm here in Nashville that already has a blockchain team that’s working with healthcare clients to build blockchain into the contracts that they’re drafting.

PF: When I talk to in-house professionals, the consensus is that they don’t really want to be in the software business. They don’t have the resources or time, but they are looking for their outside counsel and service providers to enable them to be more effective in their jobs. For law firms that are struggling with the leverage side, this is really a good opportunity for them to gain a competitive edge and at the same time bring profitability back to the firm because you’re scaling and leveraging in a way that you haven't been able to before.

MG: One of the things that’s been coming for some time is the disaggregation of legal matters – disputes and deals. With this paradigm various entities (in-house teams, law firms or alternative legal service providers) each get some of the work -- the discovery, contract, trial prep, etc. – all the pieces in a transaction or litigation. AI allows many of those pieces to be done more cheaply or efficiently by computer or with the aid of computers. This was coming anyway because in-house counsel are demanding greater efficiency and predictability, but it has been accelerated by the alternative legal service providers. Some are these players are naturally more efficient than others at some of the pieces.

KB: The alternative legal service providers range from the e-discovery providers to accounting firms, to legal process outsourcing and contract attorney providers. There are a broad range of resources available to handle elements that were traditionally “legal work.”

Q. How might law firms adapt their approach to marketing and business development considering these changes?

KB: Law firms need to market to clients using real data, real examples and real solutions to customized challenges. They need to demonstrate that they are as sophisticated in their financial management as their clients are. 

Firms that are licensing software tools and offering the service to their in-house clients are increasing the stickiness of the client relationship. For example, if a law firm sees that many of their clients need contract management tools and understand that a client might not have the budget or bandwidth, then that presents an opportunity for the law firm to acquire those tools and provide them to their in-house client. Again, it deepens the relationship and increases the level of commitment between client and firm. 

Think about what your clients need and how you can offer those solutions in nontraditional ways that add to your value proposition, in addition to that baseline entry point of accurate pricing, budgeting and project management.

PF: The attorney compensation plan is a big challenge to firms with their approach to this technology adoption. Everything we are discussing with AI and automation has a common thread: It improves efficiency, and historically, attorney compensation plans have rewarded inefficiency. In many, if not most, organizations, compensation drives behavior, and if law firms do not adjust compensation models to increase technology adoption, companies will find a way utilize to this technology whether it’s through a law firm or not.

MG: Things are going to be very different in three to five years. Law students and young lawyers need to learn everything that they possibly can about AI so they’re participating aggressively as possible from their earliest days.

This content originally appeared in the LMA Daily Conference News, by Poston Communications.

Topics: Technology Management

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