Automating the Law Factory – UK May Lead the Way
The law factory handles high volume, relatively routine legal tasks (blog posts, presentation). Like any factory, it needs automation. Whether law firms or vendors own the automation is an interesting question.
Law firms historically have not led automation efforts. Document assembly is three+ decades old but has seen limited uptake. Automated coding – hot now in e-discovery – is vendor-driven. As additional technologies emerge, will law firms grab a piece of the action?
“most banks used rules-based software that flags transactions if they match a pattern defined beforehand as suspicious, such as several transfers of money overseas in a short period. Verafin compares activity to an account holder’s profile and past behavior and assigns each transaction a ‘probability score’ that represents the likelihood it’s legitimate. King says that evaluating probabilities lets Verafin discern suspicious patterns that slip through conventional systems.”
I recently wrote that “BigData” might affect BigLaw. The BW article illustrates how very large data set, financial records here, can help spot wrong-doing.
I can envision similar approaches for other legal issues. For example, a large retailer with stores across the US and thousands of workers might have a central policy that prohibits employment discrimination. Let’s says it wanted to make sure each store actually hewed to its corporate policy. Perhaps data mining software like Verafin’s applied to employment records company-wide could spot patterns that signal possible illegal discrimination. That would give corporate HQ the radar it needed to enforce its policies.
Can developers of BigData systems do more than just spot possible trouble? Could they also dispense legal advice to deal with it? Not in the US. The biggest barrier is regulatory. Law firms that don’t run afoul of the unauthorized practice of law restrictions but vendors can. Another barrier is that law firms don’t like to invest and creating automated systems can require significant capital.
The UK is a different story. With the Legal Services Act taking effect late this year, alternative business structures (ABS) will be allowed. I suspect an ABS could develop such software and bundle it with legal advice. Moreover, ABS is a good vehicle to raise the capital to fund development efforts.
I hope that the UK will see outfits that bundle data analytics and other automated approaches to spot legal problems and offer legal answers to them. If that does occur, could US corporations ethically tap such systems for their US operations? A hard question but low cost solutions seem to find ways around regulatory barriers.
UK developments will, at minimum, likely illustrate how best to build automated law factories. And with luck, if not some legerdemain, those systems will find ways into the US market. Forward-thinking BigLaw firms, especially ones with sizable London offices, might even start to think about this and other automation scenarios.
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