Legal sector to benefit from artificial intelligence

01 November 2018
Machine-learning document software expected to reduce case management time and fees

The legal profession stands to benefit from the use of artificial intelligence (AI) especially in the areas of contract management, dispute resolution and due diligence, the CEO of a global commercial law firm tells MEED.

“There are AI applications today that allow us to do what we’re doing now faster and cheaper,” explains Mark Rigotti, CEO of Herbert Smith Freehills.

A document automation programme embedded with machine-learning tools, for example, can enable a more efficient discovery process, or the pre-trial phase when legal researchers and analysts gather evidence to assess the likelihood of a successful case.

Rigotti says such software can be trained to put together information and produce the first draft of a document, which significantly reduces the time required for the discovery process.

“A lot of the AI we’re looking at has to do with managing data and the big explosion in data,” explains Rigotti, citing that greater efficiency results in lower overall costs, which will directly benefit their clients.

The executive cites a recent case when a client, a private equity firm, only had three days to undertake due diligence for the purchase of 1,200 properties. “We can’t actually physically read all the documents for 1,200 properties in three days, but we can push all the documents into a machine that… can provide a feedback or look at the control clause of each of these properties,” Rigotti says. “That was good for the client because they can then make a go or no go decision or renegotiate the price for each of those properties [within the allocated time].”

Disrupted industry

It is understood that the process of selecting a suitable AI software can be tricky due to the abundance of products in the market, provided by relatively new or small technology companies. To address this, the executive says his firm usually tests two to three products before deciding on a purchase.

“We have a disrupted industry. Part of my job is to look to the horizon and see what is coming and… AI is coming in our industry as well as in other industries,” says Rigotti. “Part of my job, too, is providing clients what they want - primarily lower costs and quicker service - because they are under intense pressure themselves.”

The executive does not rule out a future where a legal AI can go beyond helping lawyers review and understand documents to actually performing tasks lawyers are specifically trained to do, such as giving legal advice that includes interpretation and opinion across a set of facts.

“Logic tells you AI should be able to do that. But there is an open issue among the biggest software developers  - whether [research and development] money should go into legal AI to do opinion giving, or to the more crucial sectors in  the economy like defence and health,” explains Rigotti.

The executive thinks that software developers are likely to prioritise the two sectors, which means it could take another 10 to 15 years before a fully-fledged legal AI can be developed and brought to the market. This provides plenty of time for existing and would-be lawyers to acquire additional technical skills to deal with the expected challenge.

“I think that future lawyers will have broader skill sets that would include the ability to perform more technology-related tasks,” Rigotti says.

Data privacy

In addition to other sectors taking priority in AI development, there are other important factors, such as data privacy regulations, that could have a moderating effect on the legal sector’s journey to embrace AI.

For example, banks commonly object to the use of AI when law firms investigate certain cases to protect confidentiality of customer data.  “Data privacy still trumps the need to be efficient or cost-effective,” Rigotti acknowledges.

Nevertheless, the use of data mining tools that improve processes such as case discovery, which helps lawyers to more quickly decide whether to prosecute or settle a dispute case, is expected to become more widespread.

“These tools definitely have the potential to make us more competitive and win more clients,” Rigotti concludes.

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