Future of Law: How Code Will Change the Legal World
4 Apr 2016
11 minute read
Law startups have cropped up primarily across four fields: document review, research, process automation & NewLaw.
Document review is the examination of documents & data in a case to determine which are relevant to a case. Traditionally this was done manually by attorneys, or legal trainees such as paralegals in larger firms. Document review software has become required for cases which typically have large amounts of documents to be examined. This includes litigation, mergers & acquisitions & government and internal investigations. The online form of document review, eDiscovery, is finding favour as it comes with significant time & cost savings. Legal research is the process of finding either an answer to a legal question or checking for legal precedent that can be cited in a trial or at trial. It can determine whether an issue is a ‘case of first impression’ that lacks precedent. Process automation software works to make billing more transparent and converts jerryrigged word & excel document to sleek pre-prepared online documents. NewLaw is a variety of different models for delivering legal services that is significantly different from what has come before, according to George Beaton, who coined NewLaw.
eDiscovery (or document review), research, & administrative process oversight provision would traditionally be done by paralegals, legal secretaries and other types of entry level law industry professionals. However, this is increasingly done by software. The legal industry is more competitive than ever as uni students seek to show they have analytical skills earlier and earlier.
e-Discovery in the form of machine learning, artifical intelligence driven software is changing the game. These programs are taught through training sets, which means that mistakes not caught can be magnified many times.
There is a lot of competition in the space
In the past few years, Diligence Engine, Ebrevia, EverLaw & Logikcull have got on the scene. Traditional eDiscovery firms like HP Autonomy & Symantec didn’t offer as complex search options, and charged for things the new firms don’t, which is why they were disrupted. A flow on effect is that smaller law firms can now compete with larger ones for big cases as they can train a program to take care of document review for them. Logikcull describes it as ‘democratisation.’ There is even document review software specialising in niche areas of the law. Docket alarm specialised in litigation, for instance.
Legal research has traditionally been dominated by LexisNexis and Westlaw, but Casetext, Judicata, Lex Machina, Fastcase, and RavelLaw have been using a set of new methods to do the same work. Some of these services are specialised search engines while others combine it with natural language processing enabled analytics.
Process automation is software that makes manual administrative work easier. Clio is practice management software that automates the manual processes around billing, calendaring, and task management. These are all manual administration tasks that take time out of a lawyer’s day they would prefer to spend on billable hours, a sure productivity saving. Many niche applications have been created to automate the maintenance of different types of legal administrative work. Anaqua automates the manual processes around protecting and managing IP portfolios. AltLegal is cloud-based IP software that makes it easy to prepare and manage trademarks, patents, and copyrights. WizDocs is deal management software for law firms dealing with medium and large acquisitions, whether by private equity, M&A, or IPOs. The last three would have traditionally been done through carefully modified Excel and Word documents. Now software can take care of it. ViewABIll adds transparency to the legal process by allowing people to see an online portal where hours and fees are shown in real time.
What is NewLaw?
The arrival of NewLaw is brought on by improvements in process automation, eDiscovery & research.
Marcus McCarthy, founder of Nexus Law Group, categorises NewLaw firms into six groups: dispersed law firms, lawyer placement agencies, virtual firms, online document retailer firms, fixed fee firms, and hybrid firms.
Dispersed law firms connect a network of consultant lawyers who operate independently from their own locations. They are companies like Axiom, Nexus, and You Legal. You Legal has grown rapidly, showing the potential of dispersed law firms. In just two years, they built up 14 staff and 100 recurring clients.
Lawyer placement agencies handle screening & client intake for the client-attorney relationship online. They are companies like Lawdingo and LawAdvisor. Priori manages lawyer search in the US, but for businesses looking for lawyers. LawPath is the same for Australia. It’s been used by 15000 businesses since it was established in 2013. LegalVision also operates in the Australian market. LawAdvisor in Australia & Lawdingo in the US also work as virtual firms, with services providing specialist advice online.
Provision of free legal documents is a burgeoning field, with Docracy, Cleardocs, Rocket Lawyer, Lawcentral, Law4us, lectlaw, LegalZoom, lawdepot & LegalVision all involved. Legal documents traditionally cost a few hundred to ask a solicitor to customise, and this can now be done online for free. Most small legal matters follow the same template and so it is much more efficient to just reuse and modify documents for each.
Fixed fee. This is where each type of legal service has a set fee. For example to manage a will may cost a flat $400 fee. NestLegal is one in the space. BigLaw firms like Slater & Gordon have been trying to adapt to this particular new paradigm by introducing fixed fee packages of their own. One is in divorce.
There are also niche areas that are also being disrupted by lawtech. Automated dispute resolution is an area that has found favour for small matters. Modria & Fixed have recently been established to auto dispute resolution for online shopping and parking tickets. LawyerQuote provides price comparison for Australian lawyers & legal firms.
Coder Academy student Adrian Agius is a UNSW law student who has been writing a blog about the legal impact of technology, Technolegem, looking at both technology law & legal technology. Adrian decided to learn how to code so he could get an understanding of what is behind the technology he uses every day.
He says the reasoning behind his project is that, “The legal industry is at an interesting point in its life. Digital 'disruption' has swept through other Australian industries with great effect, but has largely left the legal system, untouched. This is generally due to the conservative nature of the industry and the need to preserve justiciable outcomes. However, I think we are now at a stage where there are enough legal minded people engaging with technology to encourage a more proactive approach."
In one article, he interviews the founder of LawAdvisor, Brennan Ong. He discovers that Brennan finished both coding school and law school, making him a hybrid, enabling him to create Australia’s fastest growing law startup.
"There are many individuals doing really great things in the law tech space, but it is difficult for them to create a brilliant product and demonstrate to lawyers how it applies to their work," Adrian remarked. "It is in this space that I hope to apply my understanding of coding and programming, as someone who operates on the front-line of the nexus that is law and technology."
Compared to other industries, law continues to operate in quite an antiquated way. What does this mean for you? Well, you have a huge opportunity to dramatically change the game, and make it easier for smaller firms to compete. Process automation software, for example, merely requires skills in web design, databases and information security, but can add up to significant time savings. Hint: We teach these skills in our coding courses.
In conclusion, law is a field ripe for disruption, and there are so many more opportunities out there to liven the industry up and loosen up calcified processes. If you’re a lawyer or a law student and you learn to code, you could build the next big technology to change the legal world.
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