Blog / Striking a balance: the firms embracing LegalTech

Artificial intelligence is having a huge impact across all sectors, with law firms increasingly using software and technology to provide services – commonly known as LegalTech. Here at Lexology we are curious to see how law firms and legal departments are responding to new LegalTech products – as our LegalTech hub page shows, our author firms have been keeping us posted.

Disruptors

In June, EffortlessLegal announced the launch of its first LegalTech products for firms looking to increase productivity. These include the beta versions of LEDESConvert, which aims to combat the challenges of converting invoices between various LEDES formats, and EffortlessIntake, which focuses on automating intake processes. The company claims that through secure, cloud-based, built-in services, firms can automate various management functions.

Indeed, EffortlessLegal is just one of many companies reaching for a slice of the pie. According to LawGeex, the number of AI companies specialising in LegalTech has increased 65% in the past year, covering everything from contract management and prediction technology to legal analytics and eDiscovery. But as HighQ points out, this level of specialism creates one inevitable problem; where multiple platforms work independently, their various requirements affect their combined output. To keep track of developments in the space follow Artificial Lawyer, who have just launched a new directory of 100 key disruptive vendors.

Technology assists rather than replaces experts

If managed effectively, the latest LegalTech has been proven to increase efficiency and reduce the risk of human error in document proofing and automation, decision making, due diligence, contract analysis, transaction management and legal research. For Stikeman Elliott LLP, firms need only shop around for the most suitable programmes.

Top of the list is technology-assisted review (TAR) technology, which seems to strike the perfect balance between machine learning and human input when it comes to automating the document review process. Kilpatrick Townsend & Stockton LLP explains the TAR method, through which human experts determine the appropriate coding requirements based on what is relevant to a specific case and train the TAR system to their own unique standard. As a result, the system is a supplement, rather than an alternative, to traditional review. However, despite the many advantages (TAR can sift through a magnitude of documents, applying a consistent and efficient standard, while saving money in the process), it may not always be the best option. At present, there is no industry standard and, due to its dual nature, TAR is only as effective as the human experts programme it to be. Indeed, at Lexology we use similar technology along with editors to categorise law firm content.

Despite these potential downfalls, TAR has certainly revolutionised document review for a lot of firms. Bryan Cave Leighton Paisner (BLP) reveals that the system can provide early case analysis to determine from the outset how the evidence stacks up and whether a claim is likely to succeed. Under a proposed UK regime, parties will be obliged to discuss the use of AI software, including TAR, and the courts will be able to include the use of such tools in disclosure orders. What’s more, TAR is benefiting not only litigation, but also insolvency and data-related processes. As Hogan Lovells explains, AI-based data analysis can provide the diligence and reliable quality control needed to assist firms and governments alike.

Key applications

For Taylor Wessing, these developments can only be good news for firms, many of which are already deploying AI to undertake:

• corporate transactions (particularly due diligence) – tools such as RAVN and Kira scour the contract universe to hone in on key clauses;
• contract management – various tools are available to automatically extract and summarise the key terms of existing contracts in order to spot potential revenue or unfavourable terms that should be renegotiated;
• trademark searches; and
• dispute resolution – AI is already routinely used to mass review documents, including audio records, to identify crucial documents and get to the crux of the issue.

In-house legal departments

However, not all legal departments will have the budget or the means to invest in the most up-to-date AI. WoltersKluwer recommends that small legal departments assess their digital capacity, in order to pinpoint the areas in which AI could assist with daily workloads. They are also covering this issue in an upcoming webinar. It may be that some departments need only simple smart tools to improve their processes. In addition, this recent Kemp IT Law video asks what LegalTech can offer in-house teams.

Although many firms are still reluctant to hand over significant workloads in the wake of AI, legal counsel are in no danger of being left at the roadside in the years to come. Human intellect remains a key component of any accurate analysis and while LegalTech products can gather, sort and evaluate greater volumes of data than ever before, it still falls to the experts to maintain a sufficient level of reliability and – with more and more AI-based platforms entering the market – to determine which products best suit their business needs.

International authorities also face the daunting task of regulating an evolving digital landscape – to read more on this, see part one of our AI blog post.