As covered extensively in my Law 2050 posts, many legal industry commentators believe legal technology will undergo amazing advancements in the next decade as the combination of big data, machine learning, natural language processing, and artificial intelligence bears down on law. I’m one of them! But many also dread this disruptive prospect, worrying that it will eat away at billable hours and replace many lawyer functions with machines.
Advancements in legal technology are nothing new. Lexis and Westlaw surged onto the scene in the early 1980s to offer all sorts of better, faster, more accurate ways of conducting legal research. Law was teching up before then, and has been ever since. Did the lawyers of those early law+tech days dread the onslaught of computers, software, the internet, and all the other new gizmos? Not as far as I can tell.
Browsing through past issues of the ABA Journal offers a revealing and often humorous glimpse into the past of law+tech. Indeed, perhaps the best way to trace the history of legal technology is through the journal’s advertising pages.
I could not find any evidence of ads for legal technology prior to 1950, likely because legal technology before then consisted of a typewriter and a telephone, and not much was happening with either. The February 1953 issue, however, contains an ad for the Autograph, a contraption that allowed a lawyer to record dictation and conversations. Remington also placed an ad for a compact typewriter. Now we’re talking!
The March 1960 issue contained ads announcing the invention of the transistor (by Bell) and touting the advantages of new inventions like Edison “portable” dictating machine, the Voicecaster speaker phone, and the Thermofax copier capable of churning out one page every 4 seconds!
The January 1969 issue contained just one technology ad, for the Friden “automatic writing machine.” This contraption made a “paper tape” copy of what was typed, thus spelling “the beginning of the end of the typewriter.” What’s “paper tape”?
Most of this technology posed no threat to the demand for lawyers’ time and wisdom—it was mostly about convenience and speeding up clerical work. In the April 1974 issue, however, Wang announced its 1200 Cassette Typewriter, which because of its simplification of editing was billed as “giving you more time to be a lawyer.” Of course, assuming that lawyers previously billed their editing time, this also meant (by today’s reasoning) that the new machine would cut into lawyer billings. But I can’t find any evidence that lawyers thought that way then.
Jumping forward to the June 1983 issue—on the cusp of the office computer age—one finds scads of law+tech ads for products to improve office management, but also some offering to change the way lawyers do their work. The Prentice-Hall Phinet, for example, put all of their loose leaf tax news service into a searchable software package touted as “a new concept in tax research” that would “revolutionize your tax practice” (never mind that the dedicated terminal was the size of a small fridge). West also introduced its Instacite service. This trend continued through the 1980s. For example, in the June 1988 issue, along with gobs of ads for practice management software, Matthew Bender announced its complete bankruptcy practice software designed to simplify document drafting and assembly and other tasks normally performed by a lawyer.
Interestingly, by the February 1999 issue, most of these ads had disappeared, with Lexis and Westlaw being the only law+tech entries offering to help lawyers be lawyers. Lexis and Westlaw have continued to dominate law+tech advertising in the journal, but more recently other products have entered the fray, such as Bloomberg BNA, Fastcase, and others familiar to today’s practitioners.
What’s more interesting, though, is that none of the prior waves of law+tech were greeted with the kind of dread one hears today, including in the pages of the ABA Journal. Although I have not systematically researched the journal, only three articles mention the term “legal technology” prior to 1990, whereas it became a consistent theme by the mid-1990s.
Why did lawyers of the past (well, I’m one of them!) not dread Lexis, Westlaw, the conversion of paper to online, the internet, Google, and all the other technologies that made practicing law more efficient and effective? Why is there so much dread today? One answer may be that the legal market in the 1970-2005 time period was an ever-expanding universe, so it really was a good thing to be freed of the tediousness of research, document drafting, and so on. Being more efficient did not mean fewer billable hours. Today that’s different.
But I think it runs deeper than that–it’s existential. The current evolution of law+tech threatens to cut into not just billable time, but the essence of what it is to be a lawyer. The profession is being forced to reexamine itself and make sense of the possibility that even more of what was in the lawyer’s domain can be done by a machine.
Ultimately, though, my prediction is that lawyers will come around to appreciating what Wang offered as solace for its 1200 Cassette Typewriter many decades ago: the law+tech advancements we will see over the next decade will “give you more time to be a lawyer.” Having slogged through endless document reviews and research rabbit trails as a young lawyer in the 1980s, I think that’s a good thing!
My Law 2050 class is off to a fast start. The highlight to kick off the class each year has been two panels, one of law firm leaders followed by the other of in-house leaders, to open a deep discussion of the legal services industry in these post-normal times. As in years past, this year’s panels hit on many themes of the class. Some of the memorable comments and responses from panelists follow below. By now anyone working this space will find these self-explanatory, insightful, and real. Many thanks to my panelists for taking time out of their busy schedules to share these with the students.
Law Firm Leaders: Perry Brandt of Bryan Cave, Matt Burnstein of Waller Lansden, and Andrea Farley of Troutman Sanders
- We are never going back to the way it was
- Law firms need to double-down on technology and innovation
- Develop expertise in emerging areas
- These forces affect different firms in different ways
- Comparison is the thief of joy
- Partner mobility has changed the culture
- The bigger the client, the more they want to see legal project management
- We no longer hold the keys to the kingdom
- BigLaw is a work in progress
- BigLaw is not easy
In-house Leaders: Julie Ortmeier of Carfax, Wade Turner of Academy Sports, and Leslie Zmugg of Caterpillar Financial
- Success is a business result, not a lawyering result. Attorneys who say they get that but don’t are a dime a dozen
- I don’t want a memo; I want an answer
- The make-or-buy environment is changing
- I have yet to find an alternative fee arrangement that saves me money
- The majority of law firms’ future clients are their present associates
- Law firms need to develop a business model so that 1st and 2nd year associates don’t feel billing pressure
- I am no longer hesitant to jump firms if I am not happy
- In litigation, e-discovery costs drive the fight-or-settle decision far more than lawyer costs
- It’s not always easy to outsource. There is no universal playbook, and the core of a matter often cannot be outsourced
- The amount of lawyering that is truly unique is about 10 percent. There is room for the computer scientists to move in on the rest
And last but not least–
- We are ripe for disruption
Right now, as I write, researchers are loading medical journal articles into a computer to see if they can tease out the causes of cancer. Their goal is to use the artificial intelligence (AI) trio of big data, natural language processing, and machine learning to automate research on causal models of the complex biological systems underlying cancer.
Who’s doing this, you ask? It’s the Defense Advanced Research Projects Agency. That’s right, DARPA is researching cancer. As the agency explains it, the systems that matter most to the Defense Department tend to be very complicated systems in which interactions have important causal effects. While cancer might not be foremost as a system that influences national defense, its biology certainly is a complicated system in which interactions have important causal effects. So DARPA is testing methods for learning more about what causes cancer so it can learn more about the complex systems that do drive national defense decisions.
DARPA calls its research initiative the Big Mechanism program. Big mechanisms are models of how complex systems work. Although the collection of data needed to develop a big mechanism model is now largely automated—thus the rise of big data—the development of big mechanisms is still mainly the product of human research and reasoning ingenuity. The point of the Big Mechanism project is to see whether the development of useful big mechanism models also can be automated. If they can be, then DARPA could (automatically) load big data into the model to (automatically) develop causal models to (automatically) predict what’s going to happen of relevance to national defense.
OK, what’s this got to do with law? Most of the applications of AI in law thus far have been to improve predictive capacity in a non-causal sense, such as using machine learning in e-discovery to sort documents. The prediction isn’t based on a causal model. There’s certainly a lot of value in that approach, both scientifically and commercially. But what about law’s big mechanism? Surely the legal system is a complicated system in which interactions have important causal effects. If we had a big mechanism model of what factors cause moves in the legal system, such as the next new wave of products liability litigation, that would be a very different kind of predictive capacity. Knowing what’s coming next can come in handy for lawyers!
Shift over to another outfit called Praedicat, a spin-off of the RAND Corporation. Praedicat is using AI to develop big mechanism models of catastrophe risk for the property and casualty insurance industry. As the company explains it, their AI applications “track the science and commercial exposures for more than 100 emerging risks” and “bring technology to insurers’ emerging risk activities, converting risk avoidance to portfolio optimization; exclusion to accumulation management; and avoiding the “next asbestos” to driving sustainable profits.” Like DARPA, Praedicat relies on “the world’s community of toxicologists, epidemiologists, and bioscientists to algorithmically identify emerging risks.” Their “patented “saliency” algorithm combs through the corpus of peer-reviewed science [and regulatory documents] for new hypotheses that chemicals, products and substances might cause bodily injury. The risks are automatically prioritized by the energy and intensity of new attention the risks receive, and are tracked over time as they mature.” Then it produces “industry profiles to capture the litagion® agents that might be found at companies in the industry, and provides a “heat map” that explores the potential for clash between the profiled industry and other industries.” “Litagion agents”? That’s not a misspelling. It’s Praedicat’s trademarked term for what is essentially the big mechanism model of catastrophe insurance litigation.
What Praedicate is doing is the same as what DARPA is doing, but for insurance litigation. Open the lens wider and one can imagine applying the same approach to search for the “litagion agents” for IP litigation, drug litigation, securities litigation, products liability litigation, and a wide variety of other legal applications. That would be law’s big mechanism. That would be cool!
One sure way to put a damper on blog posting is to spend a month in Venice, Italy, which I had the pleasure of doing this June and never thought once about Law 2050. But now it’s back to reality and a top priority is planning and scheduling the third offering of my Law 2050 class this fall semester here at Vanderbilt Law School. We already have great speakers lined up with more to be scheduled.
As I was putting the schedule together today and thinking about new ideas for the class, serendipity struck in the form of an email from Perry Brandt, a Vandy Law alum and managing partner of the Kansas City office of Bryan Cave (and a speaker in this fall’s class). He sent a link to a Chicago Lawyer story about one of the most innovative initiatives I have seen any major law firm take to embrace the Post-Normal times: They flew 100 associates from around their offices to a two-day boot camp in which they tasked their pool of future partners to redesign the firm for the future. I encourage you to read the full story so won’t try to summarize it here other than to offer this snippet to give you the gist:
The firm’s message was clear: These young associates are entering a business on the brink of profound change brought on by technology and shifting economics. The future depends on their ability to adapt. And partners need to learn to listen and empower them. Toward that end, the firm held a “hack-a-thon” in which associate groups presented ideas for technologies that would aid their practice. The firm promised to spend $10,000 developing the winning idea.
Against a backdrop of illustrations from the two-day conference, associates applaud a group’s hack-a-thon pitch. One illustration reads: “Rise of the MACHINE. ” Nearby, an associate daydreams at his desk: “What business are we actually in?” Photo by Karen Elshout.
There was much more than that to the event, including a presentation by Bruce MacEwen, the New York-based law firm consultant who writes the blog Adam Smith, Esq., titled “The Rise of the Machine,” and what appears to have been meaningful interaction between firm leaders and the assembled associates.
Kudos to Bryan Cave for not just “getting it,” but doing something meaningful about it by investing in and empowering their young attorneys. I’m planning on adapting the idea to my Law 2050 class.
And with that, Round III of Law 2050 is off and running. More posts to follow!
When asked to give examples of new business models of legal practice in the US, Axiom is likely to be near the top of anyone’s list. But how long is the list–how big is NewLaw? A recent paper exploring that question suggests the answer is, not very long, but long enough to take note.
The paper summarizes research by Hastings Law School Professor and WorkLife Law Center Director Joan Williams with Center Fellow Jessica Lee and Berkeley Sociology PhD student Aaron Platt. They describe the project as
the first attempt at a comprehensive review of a wide variety of new business organizations that have arisen in recent years to remedy the market’s failure to deliver business organizations responsive to the complaints of either lawyers or of clients.
The “New Models of Legal Practice” described here typically offer a new value proposition for lawyers and clients. For lawyers, New Models offer better work-life balance and more control over other aspects of their work lives—in exchange for which lawyers typically (though not invariably) shoulder more risk, giving up a guaranteed salary, to be paid instead only for the hours they work. For clients, New Models typically drive down legal fees by sharply diminishing overhead through elimination of expensive real estate and the high cost of training new lawyers, and (again) dispensing with guaranteed salaries.
They break the New Models universe into five categories:
1) Secondment Firms place lawyers in house, typically to work at a client site either on a temporary basis or part-time (typically a few days a week). Some consist exclusively of senior lawyers who can function either as general counsel or as regional heads of legal departments in very large companies, while others place more junior lawyers to help with overflow work from in-house departments.
2) Law & Business Advice Companies combine legal advice with general business advice of the type traditionally provided by management consulting firms, and/or help clients with investment banking as well as legal needs.
3) Law Firm Accordion Companies assemble networks of curated lawyers available to enable law firms to accordion up to meet short-term staffing needs. Typically these networks are women lawyers who work short part-time hours (10-20 hours a week.) Attorneys are paid only for the hours they work.
4) Virtual Law Firms and Companies typically drive down overhead by having attorneys work from their own homes—and again dispense with a guaranteed salary, allowing attorneys to work as little or as much as they wish. These organizations vary a lot: some are very similar to traditional law firms, while others are companies in which many of the functions traditionally performed by lawyers, notably rainmaking, are the province of the company owners.
5) Innovative Law Firms and Companies include the widest variety of different business models. The single most innovative is a company with a new monetization model—providing legal services in return for a monthly subscription fee—which allows attorneys to work in a sophisticated legal practice on an 8:30 a.m. – 5:30 p.m. schedule, little or no weekend work, and three weeks’ unplugged vacation per year. Other innovative law firms change key elements of the traditional law firm model in ways that allow for better work-life balance and also have one or more of the following elements: alternative fee arrangements, team scheduling, elimination of the partner/associate distinction and “rainmaking” requirements.
After scouring the industry for these new models, the authors found only eight Secondment Firms, two Law & Business firms, five Law Firm Accordion Companies, eleven Virtual Law Firms, and eighteen Innovative Law Firms. That’s 44 total entities out there providing legal talent under a business model substantially different from the traditional law firm model. As the authors’ detailed summaries of each model reveal, some of these operations are quite large, like Axiom, and some are small.
So what’s the take home message? On the one hand, it’s unlikely that the Am Law 100, with combined revenues in 2014 of over $80 billion, are looking over their shoulders in fear of the NewLaw disruption. On the other hand, that’s 44 more entities in the NewLaw space than existed a decade ago. Also bear in mind that the lawyers in these entities are truly practicing law, or close to it (Axiom insists in tiny print it is not a law practice) rather than operating exclusively as consultancies, outsourcing firms, or online legal document providers (all of which are growing sectors of the legal industry as well). Given the practice model constraints imposed by US bar regulation, it’s impressive to see this many entities pushing the envelope. How far this trend can go without UK-like regulatory acceptance of alternative law practice business models remains to be seen, by my guess is that the drivers that led to these 44 firms forging the NewLaw universe are not going away, ever, which suggests the number will continue to grow regardless.
Yesterday afternoon five groups of Vanderbilt Law students compellingly demonstrated the power of legal technology to deliver access to justice. The students were part of an innovative class Adjunct Professor Marc Jenkins developed to bring technology directly into the law school classroom. In addition to receiving a sweeping overview of the law+tech scene through guest speakers and class discussion, over the course of the semester the students teamed up with Neota Logic to develop legal expert applications designed to assist five different public interest legal services organizations in their work. The student groups worked closely with their paired organizations to identify a need and design solutions using the Neota Logic platform. Each of the applications focused on providing efficiency to free up more time for lawyers to provide legal advice. The student groups presented their applications at yesterday’s event to a panel of four judges representing a broad swath of the legal industry (legal tech, in-house, law firm, law faculty) and an audience of over 30 interested students, faculty, and community members. The presentations were fabulous, and the judges and audience offered sound advice and probing questions.
The five organizations and the student-designed apps:
- Tennessee Justice Center – App to assist pro bono lawyers in navigating the TennCare medical denial appeals process. Features include a decision tree to walk the lawyer through the appeals process, links to guidance, sample pleadings, and cross-examination questions, and provides tips for investigating the fact background.
- Tennessee Justice for Our Neighbors – App to help users determine their DACA immigration eligibility. With only two staff attorneys serving a population of tens of thousands of potentially eligible people, this app reduces intake time and helps filter out those who are clearly ineligible. The app interviews the user, alerts the user to necessary documentation, and produces a report for the user and the organization to facilitate the initial client meeting.
- Legal Aid Society of Middle Tennessee and the Cumberlands – App to help users determine their foreclosure relief status based on timing of events and other relevant factors. The app interviews the user to help the organization determine where the user is on the foreclosure timeline and what information the user has received.
- Tennessee Alliance for Legal Services – App to help TALS match low-income users not eligible for legal aid with appropriate legal service lawyers and organizations in the state. The app interviews the user to determine the nature of their legal problem and assists them in taking steps to secure initial legal advice.
- Nashville Arts and Business Council – App to help artists of all kinds in the Nashville area identify the appropriate business entity form for their ventures. The app produces a report that the user and NABC staff can use to start the process.
Many thanks to Marc Jenkins for designing and delivering this truly exciting new course, and hats off to the students for rising to the law+tech challenge so successfully! More of this to come at the Vanderbilt Program on Law & Innovation!
Today I appeared on a forum Vanderbilt Law School holds each spring for 1L students to familiarize them with the various curricular programs we have here, of which there are many (see list here). I had the pleasure of introducing our new Program on Law & Innovation for the first time at this forum, giving the students an overview of our themes, faculty, courses, and activities. They seemed to get it, and showed genuine interest.
When I returned to my office I thumbed through the new 2015 Report on the State of the Legal Market published by the Georgetown Law Center for the Study of the Legal Profession and Peer Monitor. One startling passage (though it’s not news) reports that although very high percentages of surveyed law firm leaders agree that they are likely to continue to see demand for efficiency, price competition, commoditized legal work, and competition from non-traditional legal service providers (well above 80% in each case), only 40 percent of their firms have done anything strategic to achieve greater efficiency and only 30 percent have significantly changed pricing strategy. The report goes on later to examine different explanations for the resistance of law firms to change notwithstanding that most law firm leaders get it: lawyers are conservation; law firms are not designed to invest in innovation; why should a senior partner change rather than maximize his or her final years of profits; etc. The bottom line is that it is largely due to people and human nature, not law firms per se.
I am reminded of Max Plank’s famous observation: A new scientific truth does not triumph by convincing its opponents and making them see the light, but rather its opponents eventually die, and a new generation grows up that is familiar with it. Of course I am not hoping for any senior equity partners to die. Rather, I am hoping that our Program and others like it popping up at other law schools will equip our graduates to “be familiar with it” when it comes to initiating and navigating necessary change in their law firms as leadership shifts to them. If we can accomplish even just that, I will feel this was a worthwhile investment of the Law School’s and my resources.
Vanderbilt Law School’s Program on Law & Innovation is up and running this spring with several planned events:
Music City Legal Hackers: Program Coordinator and Adjunct Professor Larry Bridgesmith organized and led the first meeting of the Music City Legal Hackers on February 25th. Sponsored by the Program on Law & Innovation, MCLH exists to bring professionals of many disciplines together to help improve the delivery of legal services in our community. Our first meeting with Owen Byrd of Lex Machina in February was well attended and equally well received. Owen discussed the power of data analytics tools and technology applied to the protection and litigation of patented intellectual property. Additional meetings are in planning.
SeyfarthLean: On April 7th, we will be joined by Kim Craig and Andrew Baker of the Seyfarth Shaw law firm and SeyfarthLean Consulting. Kim and Andrew have been instrumental in assisting Seyfarth become a leading provider of legal services fashioned through a dedicated application of process improvement and project management methodologies. They will meet with the Music City Legal Hackers in the morning and then discuss their work at a public forum at the lunch hour in the Law School.
Legal Tech Event: This Spring semester in Vanderbilt Law School’s class on Technology in Legal Practice, twenty law students led by Adjunct Professor Marc Jenkins have delved into technology in the practice of law. The students have worked collaboratively in groups and with software to enhance access to justice in Tennessee. On April 14th, the students will present their applications to the Vanderbilt community and a panel of judges consisting of a general counsel, a law firm managing partner, a legal technology software founder, a Vanderbilt faculty member and a venture capitalist. The proceedings will take place from 3:30 – 5:00 in the Hyatt room on the first floor of the Vanderbilt Law School building. All are cordially invited to see the students’ designs and stay for a short reception to follow sponsored by the Law School’s Program on Law & Innovation.
The thrust of my Law 2050 class is to develop skills for navigating two forces of innovation in legal practice—innovation “within” the legal industry (technology, outsourcing, etc.) and innovation “outside” the law (new technologies, social issues, etc.). Students identify a trend in either category and write a paper on it in the form of a bar journal article. Their final papers were fantastic—a real pleasure to read. I’ve posted previously about two of the major themes represented in the papers: the sharing economy and the frontiers of new technology. The third major theme revolved around privacy.
You’d have to be a hermit not to be aware of, and subject to, the relentless erosion of personal privacy in the digital age. It is becoming increasingly difficult to participate in modern society and not feel the effects. A recent special issue of Science on The End of Privacy starts with the ominous line, “At birth, your data trail begins.” The articles highlight the technological arms race in the battle to regain control of privacy’s erosion. One set of articles covers facial recognition, drones, hacking pacemakers, and the ease with which your identity can be revealed from just a few credit card purchases. The other set of articles covers counter strategies such as apps that allow use of location-based apps without revealing your location and a browser app that injects decoy queries to throw off your true interests.
Law is no stranger to this engagement, with a string of statutory acronyms already firmly in place and more to come. Litigation is surging over issues from the effects of gargantuan hacks of financial records to control over one’s social media sites. Student papers covered an impressive span of these emerging legal issues:
- The controversy over Apple’s new encryption software for the iPhone 6
- Litigation against social media providers over inadequate disclosures about use of user searches, locations, and geotagging
- The implications of “predictive policing” – using machine learning to predict where crime will occur and intervening ahead of time
- The pushback Google Glass has experienced based on privacy concerns
- The implications of police forces wearing body cameras
- A new technology for detecting when drivers send text messages
- The implications of the increasing ease with which we can pay for things (1-Click, Google Wallet, Apple Pay, Snapcash, etc.)
- The increasing use of “connected cars” that are essentially smartphones on wheels, streaming data about your driving
- The health data privacy concerns posed by Apple’s Health and HealthKit apps for personal health monitoring
- HIPPA – the 800-pound gorilla of privacy law
- Trends in industry self-regulation to control privacy leaks and concerns
- Concerns lawyers face when using cloud-based storage of client files
These themes cover just the tip of the privacy iceberg that is coming to law. So, my advice to law students and young lawyers thinking about a niche to carve out? To paraphrase Mr. McGuire’s classic advice to Ben in The Graduate: I just want to say one word to you. Just one word. Are you listening? Privacy!
I am delighted to announce that Vanderbilt Law School has launched a new Program on Law & Innovation, and that I will serve as the Program’s Director with Larry Bridgesmith serving as Program Coordinator.
From the Program’s home page:
Vanderbilt launched its Program on Law and Innovation in 2015 to train the next generation of lawyers to succeed in tomorrow’s legal environment by anticipating the opportunities created by the changes in law and legal practice. The program’s curriculum and activities focus on four related themes:
- The Legal Industry. Legal service providers of all sizes and types are restructuring and changing the ways their lawyers practice. Traditional law firms now compete for business with new types of legal service providers, including legal project management firms and document review shops. New legal jobs, such as legal risk consultants and legal knowledge managers, are now available.
- Legal Technologies. Computers are increasingly doing legal work, from reviewing documents for relevant information to predicting liabilities and litigation outcomes using computer algorithms. These technologies allow lawyers to deliver more efficient and reliable services and results. They also affect the demand for lawyers and the skillsets needed to deliver legal services.
- Legal Innovation and Entrepreneurship. Fueled by rapid social, economic, and technological changes, the demand for change in law is also on the rise. Existing regulations don’t address the issues raised by new technologies such as commercial drones, and new financial products that present uncertain risks demand new strategies for public oversight. Young lawyers with an entrepreneurial eye can quickly develop expertise in an emerging or evolving area of law.
- Access to Legal Services. Most people and businesses could not afford top-quality legal services in the past. As lawyers become more efficient and legal technologies more widely available, the availability of affordable legal services will open new markets for entrepreneurial lawyers and legal enterprises.
The program’s curriculum and activities expose Vanderbilt Law students to these and other changes in the legal industry that will have profound influence on the way they practice law. Our program faculty is committed to training savvy lawyers who will be innovators in law and legal practice.
Many more news items to follow!