“Software could kill lawyers. Why that’s good for everyone else.” (Lawyers too!)

October 1st, 2011

An interesting piece from Slate that interviews Dan Katz at MSU (who I’ve blogged about before):

There’s no easy answer. The legal industry is one of the few remaining outposts of the corporate world whose operations are dictated mainly by human experience. Basic questions that anyone would want to know before committing to a million-dollar case—How likely is it that I’ll win? How good are my lawyers? Should I settle?—can’t be answered with certainty. “There’s a culture in the law around expertise,” says Daniel Katz, an assistant professor at the Michigan State University College of Law who is among the vanguard of legal researchers working to bring empiricism and artificial intelligence into law. “There’s a lot of human intuition, and people tend to think that whatever legal knowledge they have is uniquely human, and not subjectable to data and computers and automation.” . . .

In the last few years, the law has seen a rush of technological innovation, all stemming from computers’ increasing capacity to decipher and understand written documents. Many law firms now use “e-discovery” tools that can scan large caches of evidence in search of interesting facts and figures. Firms also have software to draft legal documents in a fraction of the time a human would take. And a few services on the horizon might do even more—negotiate the terms of a contract, for instance, or determine whether or not you should sue.

Automation will bring legal services to the masses. Many people who ought to hire an attorney to handle business or personal disputes can’t afford to do so. Software could potentially step in when you want to fight your mortgage lender, draw up contracts to start a small business, or sue for child-support payments

The article notes that this is bad news for lawyers.

While legal automation will be a boon for those who can’t afford representation, it’s bad news for lawyers. The industry is already in a slump, and law school is no longer seen as a sure path to riches. Because software will allow fewer lawyers to do a lot more work, it’s sure to drive down both price and demand.

“In Illinois, where I live, you see vast stretches of unoccupied land—because you no longer need people to farm the corn and soybeans that we grow around here,” says Larry Ribstein, a professor at the University of Illinois College of Law who has written several papers on the information technology revolution in law. “When I look at soybean fields now, I think of lawyers.”

The article has some examples:

Yet if you look at the tasks most lawyers perform each day, you find many that machines can handle. Language processing, grappling with complex logic, making predictions about situations involving several variables—computers are getting better at all of this stuff.

Consider that most pedestrian of legal tasks: writing up a business contract. In her career, an attorney might design thousands of contracts, many of which contain numbingly similar bits of language. Now, several legal tech companies have created programs that build these documents automatically. These pieces of software work a bit like TurboTax, asking a series of questions and using branching logic to delve deeper into specific areas. Matt Kesner, the chief information officer of the pioneering Silicon Valley law firm Fenwick & West, told me that document-creation programs save its clients time and money. Last year, Fenwick developed a system that automatically creates the documents that startups need when incorporating. “It reduced the average time we were spending from about 20 to 40 hours of billable time down to a handful of hours,” Kesner says. “In cases with even extensive documents, we can cut the time of document creation from days and weeks to hours.”

E-discovery software has been similarly revolutionary. These systems can mine huge volumes of material (like all the email correspondence in a civil suit) for damning evidence. The simplest software looks for specific keywords, but more sophisticated systems can detect patterns of behavior that might interest lawyers. This was the sort of work that once consumed the lives of first-year associates; now computers do it faster, at lower cost, and with about as much success as humans.

I (and Ribstein likely would) disagree. Changes in legal education to train the next generation of lawyers to develop and use automated tools is the key.

The barrier to change will not be from technological limitations, but from cartelized barriers to entry. Specifically, the fact that services like Pacer are locked down (I hope to address this in the near future).

At the moment, human lawyers have one thing on their side: The legal world is generally suspicious of automation, and in some respects downright inhospitable to it. To build his legal-prediction system, Daniel Katz needs a large cache of case documents. But such databases aren’t readily available. Courts publish written decisions, but other data—like case filings and motions—are locked in databases like the federal courts’ PACER system, which charges a fee for access. Until that information is easier to extract, human lawyers will have an edge.

But just as the rules and regulations protecting human pharmacists won’t be around forever, lawyers shouldn’t take comfort in today’s imperfect databases and software. Katz and other researchers are working on ways to extract and interpret historical data—one project, calledRECAP, aims to build a free mirror of PACER. And in some specialized areas of the law, data analysis is already widespread. In 2008, a group of attorneys and technologists at Stanford created the Intellectual Property Litigation Clearinghouse, a project that tracks more than 100,000 patent and trademark lawsuits. The database—which Stanford spun off last year into a start-up called Lex Machina—is the most comprehensive collection of patent suits ever assembled, and it has already helped overturn some bedrock beliefs in patent law. For years, patent attorneys believed that courts in the Northern District of California tended to be friendly to defendants, while courts in the Eastern District of Texas favored plaintiffs—a line of thinking that routinely prompted lawyers to go venue shopping. “But when we checked in the Northern District of California, plaintiffs were winning more on trial—the opposite of conventional wisdom,” says Joshua Walker, Lex Machina’s CEO.

Katz closes with a great line:

If automation brings more people legal services, at lower prices, while also pruning the ranks of human lawyers, I suspect most readers will consider that a win, win, win. And in the long run, this could well be. The trouble is that the path from here to there will be rocky—many firms will be shuttered, an ever-larger number of newly minted young attorneys will fail to find work, and a huge industry’s economic prospects will fade.

Still, of all the professions I’ve covered so far, the prospects for the legal industry seem the least awful. Sure, lawyers will suffer, but the rest of us will benefit. “The law doesn’t exist to provide jobs for lawyers,” Katz says. “That’s not its function in society. It’s there to help people solve problems—and if we could serve more people with fewer lawyers, I don’t think that’s an unreasonable path to take.”