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Vanderbilt Law School Launches Its New Program on Law & Innovation
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!
Inventing the Next Shipwreck (and Shipwreck Law)
There is a saying that whoever invented the ship also invented the shipwreck. The point is that new technologies can have their pros and cons, and some of both can be entirely unexpected. Technological innovations thus have always been a challenge for law—how can we facilitate the good while regulating away the bad, especially when we don’t have a full grasp on all of the goods and bads? But that also means technological innovation leads to legal innovation, and opportunity for lawyers to open up new fields of expertise. So, whoever invented the ship also opened the door for lawyers to invent shipwreck law!
The second major category of my student bar journal articles in the Law 2050 class was all about inventing the next shipwrecks with new technology and how law might respond. Like the topic of the first category of articles I covered—the sharing economy—student papers covered varied topics in thoughtful and insightful ways.
I could have used “dronewrecks” for my title, because a healthy number of papers looked at how we are going to take advantage of drones in various commercial applications without running into obvious problems like them crashing into homes and each other (and people). There is interest in applying drones for newsgathering, television and film production, law surveillance, and commercial delivery. A brewery in Minnesota used drones to deliver cases of beer to people ice fishing, until the FAA shut that down. Ah yes, the FAA—the agency is working on regulations for drones, which they refer to as “unmanned aircraft systems,” which the industry fears will be quite constraining of the new technology. States are entering the field as well. My students predicted a slow, incremental approach to easing in of drones under aviation regulation.
The same is true for the close cousins of drones—driverless cars and crewless cargo ships. Driverless cars, which some students covered last year, seem to be moving slowly toward market with regulation moving cautiously to let that happen. But crewless cargo ships? Well, why not? The EU and Rolls Royce are developing the technology, which raises all sorts of pros (lower labor costs, less environmental waste, no crew safety concerns) as well as interesting questions (job losses, cyber-piracy, runaway ships). Both the International Marine Organization and the insurance industry will have plenty of interest in how this develops.
Other topics covered in student papers, from tame to most out there, included:
- Bitcoins and other digital payments
- Regulation of 3D handguns
- Smartphone apps that allow the user to upload series of pictures to 3D printers, thus eliminating the need for CAD programs and allowing easy copying of sculptures and other forms
- 3D bioprinting of organs
- Organs on chips
- Commercial spaceflight
- Asteroid mining and other space property claims
- Neural implants
- My personal favorite—personal invisibility devices (don’t think they’re not working on them!)
The point of the assignment, of course, is to push students to think about law’s development in an entrepreneurial way. Although many of these technologies have a home in an established field (e.g., drones in aviation law; 3D printing in IP law), the established field isn’t a perfect fit and no lawyer is more of an expert on what doesn’t fit than anyone else. There’s no reason a recent law school graduate can’t bust into an established field on the crest of a new technology, outlining the challenges and proposing thoughtful legal innovation, to make his or her brand valued. Kudos to my students for taking that objective to heart and producing many excellent papers I’m sure bar journals would be happy to publish!
Impact Scores for Disruptive Legal Technologies
This will date me, but I remember a day when law was practiced without computer-based Westlaw or Lexis, when legal technology consisted of the five essentials: a land line telephone, Dictaphone, IBM Selectric, light switch, and thermostat. Westlaw and Lexis were, from the late 1970s until 1986, accessed only via phone modem. I recall using the modem in law school, and then at my firm in the mid-1980s experienced the miracle of using a computer to run simple searches. Life after that was not the same.
So this is not the first time legal practice has faced “disruptive technology.” But what exactly does that mean—disruptive technology? And how do we apply a metric to “disruptiveness”?
As many readers will know, the origins of the term stem from Harvard Business School Professor Clayton Christensen’s theory of disruptive and sustaining innovations. A disruptive innovation helps create a new market or industry and eventually disrupts an existing market or industry. In contrast, a sustaining innovation does not create new markets or industries but rather evolves existing ones to achieve better value.
Much of the commentary on new legal technologies has focused on the disruptive side of the equation, whereas many have a sustaining quality as well. Overall, however, I don’t find that dichotomy very useful for purposes of understanding and teaching how the new wave of legal technology will affect the practice of law and thereby affect the demand for lawyers. So this fall in my Law 2050 class my students and I disaggregated “disruptive” and “sustaining” to get more under the hood of how new technology platforms like Lex Machina, Legal Zoom, Ravel Law, and Neota Logic will change the way law is practiced. (We did so purely intuitively without dipping deeply into Christensen’s detailed theory or other business theory and commentary on the topic—so he and my colleagues at Vanderbilt’s Owen Graduate School of Business Management might cringe at what follows.) Modifying somewhat the typology we developed in class, below I use the introduction of Westlaw and the current play of Lex Machina to explain our typology and impact scoring system.
What is disruptive (and sustaining) about disruptive legal technology?
One way of thinking about how new technologies change the world is to ask a “technology native”—a person who has only known life with the technology—what his or her world would be like if the technology disappeared. For example, while I actually was able to get by years ago without Google (I am a Google “technology immigrant”), I can’t imagine my world without Google now, but I can remember one. So just think about a Google native—someone who has never seen life without Google! Ironically, with Westlaw and Lexis this is becoming increasingly less scary, as Google alone has supplanted them as the first search engine of choice for many legal searches. But let’s envision Westlaw and Lexis coming on line in the 1980s or disappearing in the 2010s and ask, so what, who cares, and why? In what ways is the world of lawyering different with or without them? I come up with five effects, each of which has a 20-point impact scale:
Quality enhancing impact: In the do it better, faster, and cheaper trilogy dominating the legal industry today, quality enhancing technology works on the delivery of better service. For example, Westlaw and Lexis vastly improved the accuracy of search results, such as “find cases from the federal courts in the Fifth Circuit that say X and Y but not Z.” Sure, a lawyer could have run key number headings in the books and read through legal encyclopedias, but the miss rate simply went down when Westlaw and Lexis came on line. So to, with its deep database of IP cases and filings and assessable research design, does Lex Machina improve accuracy of searches about IP litigation, though at present it does not run broad substantive research searches. Scores: Westlaw and Lexis 18 (like Russian skating judge, leaving room for some later contenders); Lex Machina 12
Efficiency enhancing impact: Anyone who has ever run key numbers in hard copy digests or Shepardized a case using the books will appreciate the efficiency enhancement Westlaw and Lexis provided—the “do it faster” component of today’s client demands. Similarly, although one could use the brute force of Westlaw or Lexis searches to assemble the results of a Lex Machina search about the IP litigation profile of a judge or patent, it’s a heck of a lot faster using Lex Machina. Scores: Westlaw and Lexis 18; Lex Machina 18.
Demand displacement effect: Assume a world in which the number and scope of client driven legal searches does not change. In that case, the introduction of a new legal technology that has quality and efficiency enhancement effects is likely to displace demand for service in some sectors of the legal industry if the technology is a cost-effective competitor. For example, Westlaw and Lexis allowed better and faster legal searches, but unless priced to be cost-competitive with the old lawyer-intensive ways of doing legal searches, they won’t penetrate the market. Bottom line, there are fewer billable hours to go around. Given the success of Westlaw and Lexis in establishing their markets, one has to assign them the potential for this displacement effect. It’s much harder to tell with Lex Machina, because it’s not clear what the demand was for the information its type of searches provides prior to its availability. Scores: Westlaw and Lexis: 15; Lex Machina 8
Transformative effect: The opposite side of the coin is the potential a new technology has to open up new markets for legal tasks not previously possible or valued. For example, other than paying for a bespoke lawyer’s judgment about the profile of a particular court for IP litigation, I find it hard to believe many clients would have paid lawyers to perform the kinds of hyper-detailed big data litigation information searches Lex Machina makes possible about lawyers, courts, and patents. Even more so, some of the search techniques Westlaw and Lexis made possible would have been virtually impossible to replicate the old fashioned way with the books. To the extent these new capacities are valued—e.g., they lead to better litigation prediction and outcomes—they will increase demand for service. Hence the transformative effect can work to offset the displacement effect, meaning a new legal technology might increase the pool of billable hours. Scores: Westlaw and Lexis 15, Lex Machina 12
Destructive effect: All of the above discussion has assumed it will be lawyers using the new technology, which clearly will not always be the case—the new technology might reduce or eliminate the need for a lawyer at the helm. Some new technologies will provide user interfaces that do not require an attorney to operate. The rise of paralegals conducting research on Westlaw and Lexis is an example. Even more destructive are technologies like predictive coding, used in e-discovery to vastly reduce the need for lawyers, and online interfaces such as Legal Zoom, which sidesteps the Main Street lawyer altogether. My sense is that Westlaw and Lexis did not have so much destructive effect outside of pushing some work down to paralegals, and the same will hold true for Lex Machina. Scores: Westlaw and Lexis: 8; Lex Machina 8.
Total Impact Scores: Westlaw and Lexis 74; Lex Machina 58.
Of course, this is all meant to be a bit provocative and poke some at the overuse and misuse of the “disruptive technology” theme in our current legal world. As I said, it is not informed by formal business theory, nor do I have any empirical evidence to back up my scores. But the categories of effects seem on point and relevant to the discourse on impacts of new legal technologies, and the scores strike me as decent ballpark estimates. At the very least, I’ll have a model the students can use to dissect the legal technologies they choose to study in next fall’s Law 2050 class!
Regulatory Innovation and the Sharing Economy
My Law 2050 energy has been devoted the past month to grading a pile of fabulous papers my students compiled on a broad variety of topics and planning some exciting new developments here at Vanderbilt. More on the latter, later. For now, some observations on several trends in law based on the student papers.
The major writing assignment in the law 2050 class requires students to identify an “inside law” or “outside law” trend and cover it in a blog post, client alert latter, and bar journal article. The purpose is twofold: (1) expose them to writing styles their future employers are likely to expect them to use for professional development and (2) encourage entrepreneurial thinking about how to “jump on” emerging themes and opportunities.
As I have mentioned before, the breadth of “outside law” topics was impressive. Three major themes dominated, however: (1) regulating the so-called sharing economy; (2) weird new technologies; and (3) personal data privacy. Taking them one at a time, this post covers the sharing economy, a snarl of legal issues that ought to keep plenty of lawyers busy for the foreseeable future.
The engine of the sharing economy, no surprise, is the internet and its capacity to link people. Sharing economy companies leverage this capacity to match supply and demand primarily for services, the big three so far being rides (e.g., Uber), rooms (e.g., Airbnb), and odd jobs and errands (e.g., TaskRabbit).
Two opposing narratives have dominated the debate over how to receive the sharing economy. In one, sharing economy companies project themselves as innovative middlemen who merely use smart phone technology to hook up willing service providers with those in need of a ride, place to stay, or broken pipe fixed. In the other narrative, regulated companies in the traditional economy who see the sharing economy as completion accuse its participants of illegally and unfairly skirting rules and regulations running the gamut from licensing to taxes to employment. Which is it? It seems like a little of both to me, which is what has made the sharing economy a regulatory challenge.
The rhetoric of the sharing economy began with its name, because it is not at all about sharing—it’s about charging for services. When ride-share companies ramped up around the nation, for example, they took the position that it was simply about using phones and their smart software to match people who needed a ride with people who for whatever reason felt like driving people around—any exchange of money from passenger to driver was a “donation.” But now with surge pricing and capitalized values in the billions, the sharing economy looks much more like a business model. The other preposterous premise of the sharing economy was that it is quaint and benign, presenting no concerns that should catch the eye of regulation.
The sharing narrative fell apart pretty fast, however, and the rhetoric shifted to fending off the regulatory wolves. Questions raised about the ride-room-errand trio have been so obvious, however, it’s clear the inventors of the sharing economy decided just to go forward without asking permission and wait to see what hit the fan, when, and where. After all, it’s no accident that we regulated rides, rooms, and errands for hire, and for good reason—just check into the history of taxis in major cities in the early 1900s and you’ll find plenty of horror stories. Even a short typology of legal and regulatory issues these new upstarts present is chock full of issues:
- business licensing and taxes: Must Uber or its drivers be licensed as a taxi; must Airbnb or its “landlords” pay hotel taxes
- employment status: Are Uber’s drivers and TaskRabbit’s tasklers independent contractors or employees?; Who payes TaskRabbit’s tasker employment taxes?
- health & safety regulation: Are Airbnb accommodations subject to health regulations and the ADA
- insurance and liability: Who is liable when an Airbnb “tenant” burns down the apartment or an Uber driver assaults a passenger or drives into a building?
- zoning: What if local zoning does not allow hotels in a particular area–can Airbnb operate there?
- private contracts: What is homeowner association bylaws or an apartment lease restrict rentals and sublets?
On the other hand, it’s just as clear that the regulatory system has gone far beyond managing the problems presented by unrestricted ride, room, and errands providers to become part of the problem, protecting the taxis, hotels, and other services industries as much if not more than it protects consumers. Surely the regulated companies do deserve some protection in return for bearing the burden of regulation, such as the fixed rates taxis must charge regardless of demand. But if I can get an Uber driver at a busy downtown location in one minute, have him or her drive me safely back to my reasonably-priced Airbnb apartment I rented for the weekend late the prior week, and get someone over quickly to clean up the place before I turn in the key, what’s wrong with that? It’s hard to get that from the traditional regulated economy. And if the traditional regulated economy isn’t meeting demand, it’s worth taking a step back to ask how to improve the system.
So we have a regulatory conundrum on our hands: consumers love the sharing economy, but want some acceptable level of security and protection; entrenched regulated providers in the traditional economy such as taxis and hotels hate the sharing economy, but can’t deliver its same level of convenience because of regulation; government sees licensing fee and tax revenue slipping away, and can’t please both consumers and the regulated industries.
At the two extremes, one approach would be to unflinchingly apply all the status quo rules of the traditional regulated economy to the sharing economy, which would largely eliminate it, and the other would be to simply turn a blind eye and let tort law sort out the provider-customer relations in the sharing economy, which will cut deep into the stability of the regulated ride, room, and errands providers of the traditional economy. For a while it looked as if the live and let live model was prevailing, as companies like Uber and Airbnb shot into hipster prominence. More recently, however, the sharing economy has taken serious hits, such as Uber’s complete ban in Nevada and fines in San Francisco and Airbnb’s tangles with New York, to name just a few.
A compromise would be to think hard about innovative regulation for the sharing economy. Eric Biber and I, for example, have suggested using a general permitting approach to segregate different segments of sharing economy markets in terms of level of activity and corresponding level of regulation. Or, as Shrai Shapiro has suggested, intermediate forms of regulation, fees, and licensing could be used to open markets to the sharing economy in limited ways. Nashville, for example, recently allowed Uber to operate at the City’s airport, but subjected it to registration, insurance, inspection, and background check requirements.
Either way, its clear that the sharing economy is not going away, but neither are consumer protection regulation, licensing fees, and taxes. The legal issues remain numerous and unresolved. I was glad to see several of my students take hold of this theme and delve deeply and insightfully into its future.
In Appreciation of the Fall 2014 Law 2050 Class Guest Speakers
Classes are over here at Vanderbilt Law School, and I am happy to say that the second edition of my Law 2050 class was chock full of great guest speakers—21 in all. Because they make up such a key component of the class, I want to thank them all again. This year’s roster included the following presentations and speakers, in order of appearance:
Law Firm Leaders Panel: Andy Bayman (King & Spalding), John Grenier (Bradley Arant), and Todd Rolapp (Bass Berry Sims)
In-House Counsel Panel: Mike McCarthy (Quantumscape), Celia Catlett (Texas Roadhouse), and Sara Finley (CVS/Caremark)
Law Firm Globalization and Consolidation: Steve Mahon and Mark Ruehlmann (Squire Patton Boggs)
Introduction to Legal Project Management: Larry Bridgesmith (ERM Legal Solutions and Program Coordinator, Vanderbilt Program on Law and Innovation)
Introduction to E-discovery and Information Technolog: Marc Jenkins (Cicayda and Vanderbilt Law Adjunct)
Alternatives to Big Law Panel: Annie Passino (Southern Environmental Law Center), Austin Payne, (Tennessee Department of Environment and Conservation), and Alex Scarbrough Fisher (Thompson Burton)
Demonstration of Lex Machina: Jeremy Mulder (Lex Machina)
Introduction to and Workshop on Neota Logic: Kevin Mulcahy (Neota Logic)
The Technological Future: John Lutz (Vanderbilt Vice Chancellor for Information Technology)
Demonstration of Casetext: Jake Heller (Casetext)
Lean Law: John Murdoch (Bradley Arant) and Prof. Nancy Hyer (Vanderbilt Owen School of Business)
Law Firm Economics: Patrick Cavanaugh (Blank Rome) and Walt Burton (Thompson Burton)
Thank you all—the class would not be what it is for the students without your involvement!
JB
Law 2050 Students Take a Deep Dive into Neota Logic
Many, many years ago, when I was practicing environmental law with Fulbright & Jaworski in Austin, I was unfortunate enough to have a number of clients whose needs required that I master the EPA’s utterly convoluted definition of solid and hazardous waste. One summer I assigned a summer associate the task of flowcharting the definition. Over the course of the summer we debugged draft after draft until, finally, we had a handwritten flowchart that flawlessly worked any scenario through the definition step-by-step. It was ten legal-sized, taped-together pages long. It worked, but it wasn’t very practical.
If only we had had Neota Logic back then! Last week, in my Law 2050 class, Kevin Mulcahy, Director of Education for Neota, demoed their product over the course of two classes and a 3-hour evening workshop. Prior to the session I had assigned the class the exercise of flowcharting the copyright law of academic fair use. Each student prepared a flowchart and explained its logic, then six groups collaborated on final work products. I sent the group flowcharts to Kevin so he could use them to explain the Neota platform in a context familiar to the students.
Neota is a software program that allows the user to translate legal (or other) content into a user-friendly interactive application environment, much like Turbo Tax does for tax preparation. Neota allows the content expert to build the app with no coding expertise, with end products that are quite sophisticated in terms of what can be embedded in the app and how smoothly the app walks the user through the compliance logic. Example apps Kevin offered covered topics as varied as songwriter rights to Dodd-Frank compliance.
The first class period Kevin introduced Neota and then walked through each of the group flowcharts to analyze how each one broke down the fair use compliance problem. The core theme was how important it is to develop the output scenarios first. In the fair use exercise, there are several yes/no questions specific to educational uses, and then a multi-factored balancing test applies in the event none of those binary questions leads to a fair use outcome. Like any balancing test, this one yields a range of scenarios from very likely fair use to very likely not fair use. We spent a good deal of time thinking about how to design an app component to capture the balancing test.
In the evening workshop a group of 20 students acted as content experts to guide Kevin through the process of building the fair use app, much in the way a legal expert might work worth a Neota software expert. The most striking learning experience from this session, besides the deep look under Neota’s hood, was how the process of building the app actually sharpened our fair use compliance logic. We tested various approaches for capturing the balancing test and conveying output scenarios with substantive explanations for the user.
The next day the entire class regrouped to go over the workshop product, allowing those who could not make the workshop due to conflicting classes the chance to get a good feel for both the flexibility and precision the Neota software offers. Thinking back to my perfectly accurate but impractical ten-page flowchart of the EPA’s waste definition, I could envision how that and many other tasks that required developing a compliance logic could have been leveraged into apps I could have shared with other attorneys in my firm as well as clients.
My Law 2050 students clearly got a lot out of the immersion in using Neota to attack a compliance logic problem. I can’t thank Kevin and Neota enough for the time he invested in preparing for and delivering what was an excellent hands-on and instructive workshop. By the way, the EPA now has an online decision tool for navigating through the waste definition. I think they might want to get in touch with Neota!
Lex Machina a Smash Hit in Law 2050
This week my Law 2050 class has been all about Lex Machina, and to quote one student at the end of the two sessions: “I can’t imagine being a patent law firm and not wanting to purchase that!” [Note: I have no connection whatsoever with Lex Machina other than having them appear in my class, nor, I believe, did this student.] That sentiment was widely shared.
I contacted Lex Machina early in the semester to explore how I could give the class a deep dive in their technology. Jeremy Mulder, Lex Machina’s Director of Customer Success, worked closely with me to make the site available to the students, design an exercise for us to complete in one class, and guide us through the site and the company’s vision over a JoinMe link the next day.
My reactions:
First, the Lex Machina product is a truly awesome example of turning Big Data into a useful, user-friendly legal analytics product. The depth and breadth of data contained in the site, particularly for patent law, was astounding. For example, pick any federal district judge and within a few seconds the site provides an array of data, including outcomes at granular levels, patents handled, time to case termination, lawyers appearing in the court, and many more. The site display and navigation is a breeze. The class started to tackle the questions together at the beginning of the first class, and within about 10 minutes, with no instructions from Lex Machina, we had begun to navigate the site with ease and, over time, learned how to tap into one after the other of analytic tools. The site is a model for other law+tech developers.
Second, as the exercise progressed I began to wonder how I would describe Lex Machina within the “disruptive technology” space. Disruption comes in many forms, and whether good or bad depends on the beholder. Lex Machina strikes me as disruptive primarily by providing an additive function—it makes possible what a lawyer could not have imagined he or she could do, at least without a tremendous amount of effort, time, and cost. It adds a tool, but it does not necessarily replace lawyers, or suck away billable hours, or “commoditize” a lawyering function; indeed, by giving lawyers more power over how to analyze patent law’s expanse, it may do just the opposite. More on the “disaggregation” of the disruptive legal technology concept into more descriptive and refined categories in an upcoming post.
Law 2050 Student Projects on Trends in Law and Law Practice
Given how much time we spend in law school covering what the law was and is, one of the goals of my Law 2050 class is to get students to think about what the law will be and how they can help shape it’s future. I have students identify examples of two kinds of trends. The first is an “inside law” trend, such as new technology and new kinds of service providers, that will influence how law is practiced. The other is an “outside law” trend, such as developments in health care, technology, and the economy, that will influence how law evolves in response.
Last year I had students work in groups to present “pitches” in a shark-tank setting, with the pitch being an assessment of whether to invest in the trend (e.g., put money into a new legal practice technology or devote firm resources to developing a new practice area). This year I have used this phase of the class to develop some practical, practice-oriented writing skills: a blog post, a client alert letter, and a bar journal article. As was the case last year, once again I am thoroughly impressed with the topics the students selected, and their blog post assignments were top-notch. Watch for several of them in coming days as students serve as contributing bloggers!
Here’s a sample of the topics:
Inside Law Trends: lawyer coaching for pro se clients; IP prior art search outsourcing; third party litigation funding; Shake, the contract app; legal hackathons; legal fee analytics; Ravel Law; Mitratech’s software for in-house counsel; “low bono” law firms; legal project management firms; online dispute resolution; pricing consultants; Islamic finance practice; speech recognition programs for lawyers; Bryan Cave’s Rosetta project; legal knowledge engineering; telecommuting and the decline of the law office; Counsel on Call; Integron; business for lawyers training programs; legal solution engineers; Clerky; Axiom–is it becoming another BigLaw?; virtual courts; Legal Force; and compliance lawyering.
Outside Law Trends: digital signatures; commercial delivery drones; invisibility cloaking; Google Glass; neural implants; predictive policing; driverless cars; commercial space travel; e-money; The Internet of Things (embedded sensor networks); newsgathering drones; unmanned cargo ships; virtual patient consultations; 3D printing of guns and organs; apps to convert 3D iPhone photos to 3D printing; Apple’s fitness watch; automobile connectivity and privacy issues; texting detection technology for police; cloud storage issues; sea level rise; crowdfunding; negligent infliction of disease; ridesharing (Uber etc.); robotic surgery; renewable energy trends; extreme reality TV; fracking; human gene patenting; and police body cameras.
Needless to say, we are going to have some interesting class discussions!
Has All the Important Law Already Been Invented?
A few months ago the Wall Street Journal carried an article titled Has All the Important Stuff Already Been Invented? It was about a dispute between two Northwestern University economists over that very question. The basic gist:
Robert Gordon, a curmudgeonly 73-year-old economist, believes our best days are over. After a century of life-changing innovations that spurred growth, he says, human progress is slowing to a crawl.
Joel Mokyr, a cheerful 67-year-old economist, imagines a coming age of new inventions, including gene therapies to prolong our life span and miracle seeds that can feed the world without fertilizers.
Law 2050 being what it is, I had to ask the parallel question for law: Are the best days of legal innovation over, or are we entering a coming age of new legal “inventions”?
The first aspect of this to sort through is the difference between new law and new legal innovations. We’ll always be making new law—the question is whether any of it will be innovative. More to the point, what exactly is a “legal invention”?
My main field of research and practice, environmental law, has gone through several of what legal scholars suggest are “generations” of evolution. Each generation represents a significant innovation in the approach and content of the law. As my good friend Tony Arnold of The University of Louisville Law School framed it in a recent article, Fourth-Generation Environmental Law: Integrationist and Multimodal:
U.S. environmental law appears to have evolved from reliance primarily on common-law tort and property doctrines to government reservation and management of lands and natural resources to pollution control and prevention through command-and-control regulation, technology-based standards, and rule-of-law litigation. Some have characterized the latter collection of command-and-control statutes and regulations, administered with technology-based standards and enforced by rule-of-law litigation, as the first generation of environmental law. This generational classification is in contrast to what are often referred to as second generation environmental law methods that emphasize regulatory flexibility and the harnessing of economic incentives. These include compliance incentives, negotiated rulemaking (or “reg. neg.”), and market-based mechanisms. Some believe that the structure and practice of environmental law have now entered a third generational phase with the growing use of collaborative and voluntary processes, outcomes-based instrument choice, and reflexive law principles to achieve sustainable development and engage in ecosystem management. In each case, the new features of environmental law have simply been added to the existing features, making some modifications to the older structure but mostly just adding new generations to the family of environmental law.
He then predicts the emergence of a new, fourth generation:
Ecological and social forces of change—and the policy imperatives that they create—will move the next generation of environmental law towards integrationist and multimodal methods of addressing complex, interdependent, dynamic, and multiscalar environmental problems.
So the point is, legal inventions are new kinds of law, not just new law. And as Arnold suggests, it’s usually forces of change outside of and acting on law that spur legal innovation.
Certainly as much, and perhaps more than, any force of change, technology has rocked law over time into new configurations. So, going back to the Gordon-Mokyr debate, if Gordon is right then we can expect to see technology become less of a player in spurring legal innovations. But if cheerful Mokyr is right, we could be in store for new kinds of law we don’t even imagine today. Consider, for example, the increasing breadth and depth of information and knowledge being put at our fingertips through Big Data and machine learning. Could this lead to more than just new law, but also to legal innovation?
That’s the kind of question I put to my students in Law 2050. One assignment is to identify some economic, environmental, technological, or social trend and play with its potential legal consequences. What novel issues might it present? What legal responses will be appropriate? Do we need legal innovation to respond, or just new law? I’m looking forward to their projects and answers, and for now my strong hunch is that we have not seen the end of legal innovation, not by a long shot.
This Is a Relationship Business!
The second week of Law 2050 concluded with a panel of corporate general counsel, the day after the panel of law firm leaders. As a reminder, the participants, whom I thank profusely, were
- Andy Bayman – King & Spalding
- Beau Grenier – Bradley Arant Boult Cummings
- Todd Rolapp – Bass Berry Sims
- Mike McCarthy – Quantumscape
- Celia Catlett – Texas Roadhouse
- Sara Finley – Caremark
Also participating on the law firms panel was Mike Duffy, King & Spalding’s first Director of Growth & Client Service, who added a fascinating dimension to the discussion. I think it is fair to say the students were riveted by the discussion and will have lots to work with in their reaction papers.
I have enough notes from the panels to fill pages, so I plan to break my own reactions down into several posts over the next few weeks. Today’s has to do with a theme the cut across both panels: As one of the GCs put it, “This is a relationship business!” Now, I am sure everyone gets that in general–lawyers have to forge a relationship with their clients and vice versa–but what does that mean today, six years after 2008 hit the reset button. I’d have to say that the GCs panel was most emphatic about this, so I’ll start there:
- It’s about the lawyer, not the firm. I have always maintained that the spike in lateral partner and practice group movement in the late 1980s, which I saw happen around me in my firm and which has not abated, was the beginning of the erosion of the “trusted firm” relationship. It has been replaced by what the GCs described as the “follow the lawyer” relationship, which places less weight on the firm and more on the individual.
- Share the risk. The GCs want that individual to forge a partnership that involves new ways of sharing risk, as opposed to the old model of firms shifting all the risk to clients through the billable hour.
- Help yourself by helping me. The outside lawyer also has to recognize that GCs and their in-house legal team “live with the client.” They are on call 24/7 and are under intense pressure to get answers fast and to perform like any other branch of the business. There is low tolerance in that environment for outside lawyers looking to make themselves look good–the real value comes in making the in-house lawyers look good to their C-suite colleagues and to have their back. Do that and it will work both ways.
- Look around the room. One student asked how to begin to forge those kinds of relationships, and the best advice was to start by looking around the room–in other words, it starts in law school and continues into the years of associateship. All those GCs out there were once law students and associates too, so the person next to you in class or down the hall at the firm could very well later be in-house at one of your current or prospective clients.
- Don’t fake it. The GCs also had low tolerance for outside counsel who go too far outside their or their firm’s wheelhouse to keep work. That costs clients time and money, and won’t help get return business.
My sense is that none of this would have surprised the law firm leaders panel, but that the harder question for them is how to forge and sustain this kind of relationship in a static market facing intense competition from within (other firms) and outside (new kinds of service providers). All the law firm leaders agreed it starts with firm differentiation, although if the “follow the lawyer” trend is real and growing, one has to wonder whether differentiation matters. The firm lawyers suggested it does if it achieves niche or strength differentiation, as that is likely to attract the best lawyers. But the most interesting angle on it came from Mike Duffy, a non-lawyer who came to King & Spalding from Ernst & Young. Among his many functions there, one practice he has instituted is to interview clients who retain the firm, but also those who decline to hire the firm, as in what did the firm not bring to the table. That practice has to lead to some insight about how to get the relationships up and running next time.
To drive this message home, Mike Duffy also revealed to the class what he believes, based on years of observation, to be the traits of the most successful lawyers (more on which later). High on the list was “relationship skills.” Those do not come naturally to all people and are hard to teach in law school, but if I got anything out of the two panels (and I got a lot), it’s that this world of lawyering is, now more than ever, a relationship business.
Law 2050 