This promises to be quite a week in legal AI. Today’s post is the prelude to what I expect to be a deluge of news from ILTACON 2018. I’ll be traveling all day Tuesday, so getting a slow start on my ILTA coverage.

 

  • Early news from ILTACON via Artificial Lawyer: “Thomson Reuters has developed an application that creates ‘smart documents’ using Contract Express and the blockchain capabilities of Integra Ledger.” “….(T)the aim is to have the POC work seamlessly with NetDocuments.” Details here.

 

  • A2J news from Artificial Lawyer: “Australia-based legal tech company, Legaler, has raised $1.5 million to help build blockchain-based solutions for the future of legal services and to boost access to justice.”

 

  • Hogan Lovells announcedThe Hogan Lovells law firm advised on the first ever blockchain technology-based transaction on the Polish office market. “The parties involved were Business Link (the Landlord), and Ricoh (the Tenant). … The innovative solution based on blockchain technology was implemented in order to ensure the safety of the lease transactions, the indisputability of the commercial and legal conditions, as well as the reduction of agency and consultation costs.”

 

  • From Mayer Brown’s Rebecca Eisner, this is an interesting financial services-focused discussion of the need for AI laws and regulations, and how one should (cautiously) proceed until more are in place.

 

  • Legal Futures reports that “(t)he company charged with digitising the (UK) courts (CaseLines) is to deploy artificial intelligence (AI) to assist lawyers in understanding complex evidence, ….CaseLines … will use the technology to create a ‘mind map’ – a visual way of presenting information said to mirror more closely the non-linear way the human brain handles data.” “Paul Sachs, chief technology officer of Netmaster Solutions, the company behind CaseLines, (said AI is) a ‘terribly powerful’ tool to extract data such as ‘nouns that are not simple nouns, verbs that are not simple verbs, so places and people and so on.” “What I want to do is to create a mind map… which a lawyer can then basically use as a search tool to search the evidence in a way that is very practical.”

 

  • Here’s the final installment of Information Age’s Artificial intelligence in the legal industry: The future – Part 3. It covers the rise of Chief Technology Officers, how to facilitate the inevitable infiltration of AI into firms and the importance of data. “As with any other business, in any other industry, failing to innovate and improve will lead to extinction. Transform or die. … AI will soon become the standard. Those who don’t have and use it will, by definition, be sub-standard and in turn will be left behind by their clients, their competitors and the entire legal industry. Those that don’t adopt AI will fall behind their competitors, lose their clients and be entirely disrupted.”

 

  • This is my third inclusion of the Riverview/EY news. It’s one of the most thoughtful pieces yet, so I’d be remiss not to include it. The post discusses Riverview’s revolutionary focus on data, and (in my opinion) even more important: “Since its inception Riverview has advocated an ethos to which it has stayed faithful throughout, which is quite simply to put its customers at the centre of the design and evolution of its business model. Unlike any other organisation in this market, it set out from day 1 with an unwavering focus on defining value from a client perspective and then seeking to develop a model to deliver services, profitably, in line with this. The best and most prominent illustration was its decision to loudly and proudly eschew the billable hour. Standing by this has involved swimming against the market tide and genuinely taking risks in the pricing of work, not by reverse-engineering hourly charges but by putting faith in its ability to make efficient use of people, process and technology.  Failure is inherent in this approach – risks are risky, and don’t always pay off – but it simply leads to learning, recalibration and improvement.” More here.

Here’s a related story about the Big Four as threats to mid-sized law firms, and how those firms perceive the encroachment into their clients. “(L)aw firms may be able to seize on opportunities to collaborate with non-law firm competitors.”

  • A couple of days ago I reported on EY’s acquisition of Riverview Law. Since then it has been very widely reported (e.g., here) and the subject of many tweets, blog posts (e.g., here) and articles. Many see it as a portent of things to come, some agreeing with “Cornelius Grossmann, Ernst & Young’s global law leader, (who) said in a press release that the acquisition ‘underlines the position of EY as a leading disruptor of legal services.’ EY says the company will help it cut the costs of routine legal activities.” Artificial Lawyer’s in-depth analysis includes: “The EY/Riverlaw deal matters, but it matters most because it is part of a far larger picture: the incremental industrialisation of the provision of legal services to the global economy and society as a whole.”

 

  • AI you can use! This interview with Ping CEO Ryan Alshak describes how his company tries to take the pain out of timekeeping. “We obsess over eliminating the friction of timekeeping. There is no reason why it should take just as long to log work as it does to perform the work in the first place. Our design motto is ‘less clicks.’ In terms of automation, we plug into systems lawyers use to perform billable work and we leverage machine learning to build a complete timesheet. So, a lawyer works exactly as they are now, and Ping captures, categorizes, describes and codifies it automatically. The lawyer just needs to review and release.” Of course, this is only relevant if your law firm still records time.

 

  • From Radiant Law, a LawTech Glossary with more than a twist of sarcasm. for instance, AI is, “A term for when a computer system does magic. “General” artificial intelligence refers to thinking computers, a concept that for the foreseeable future exists only in science fiction and LawTech talks. “Narrow” artificial intelligence refers to a limited capability (albeit one that may be very useful) such as classifying text or pictures, or expert systems. Discussions of AI that blur general and narrow AI are a good indication that you are dealing with bullshit.” I also enjoyed this one: “Design thinking: A new approach to improving processes, involving sticking brightly coloured post-it notes to walls or, preferably, windows.”

 

  • Ropes & Gray (Mark V. NuccioGideon BlattMike Tierney) issued this alert regarding a report issued July 31: Treasury Department Issues Regulatory Report on Fintech and Innovation. Among Treasury’s recommendations: “Further development and incorporation of cloud technologies, machine learning, and artificial intelligence into financial services.”

 

  • This article (The Robots are Not Just Coming – They are Already Here) is from the Journal of Accountancy, but its recommendations for “Cherished Advisors” are applicable to law firms.

 

  • Computer Security: New genre of artificial intelligence programs take computer hacking to another level. “(A) team from IBM … have used the artificial intelligence technique known as machine learning to build hacking programs that could slip past top-tier defensive measures. The group will unveil details of its experiment at the Black Hat security conference in Las Vegas on Wednesday.”  “Whoever you personally consider evil is already working on this.” More here.

 

  • National Security: As China’s Military Masters Artificial Intelligence, Why Are We Still Building Aircraft Carriers? “China appears determined to seize this AI “high ground” of future conflict. For the last two years, Chinese companies have won an AI competition for detecting objects. The Chinese are happy for the U.S. to keep building carriers and bombers, so long as they deploy the more advanced technologies that can disable these systems.” “…(I)n the Pentagon’s initial request for $74 billion in new defense spending in fiscal 2019, only .006 percent was targeted for science and technology.”

Meanwhile, thisPentagon to create new command for fighting in space, but resists Trump’s proposed ‘space force’. “Trump has never explained at length why he favors creation of a space force as an additional military service, but the concept often draws loud cheers at rallies.”

And this: JAIC: Pentagon debuts artificial intelligence hub. “On June 27, Deputy Defense Secretary Patrick Shanahan issued a memorandum that formally established the Defense Department’s new Joint Artificial Intelligence Center (JAIC). According to the memo, JAIC’s overarching aim is to accelerate the delivery of AI-enabled capabilities, scale the impact of AI tools, and synchronize the department’s AI efforts.”

 

Blockchain

  • Like Oil and Water: Artificial Intelligence and Blockchain. This post‘s author () remarks that “(o)ver the next ten years, AI and Blockchain are two technologies that will form a pillar for the next set of billion (trillion?) dollar organizations. When combined with the Internet of Things, there are some useful applications that will be created to make our lives even easier.” But for now, he sees AI’s utility mainly in detecting fraudulent blockchain activity, and conversely that blockchain can serve as “(d)ecentralized AI marketplaces for data that AI needs.”
  • From Information AgeArtificial intelligence in the legal industry: Adoption and strategy – Part 1, an insightful discussion with Geoffrey Vance, the chair of Perkins Coie’s E-Discovery Services and Strategy Practice, and Alvin Lindsay, partner at Hogan Lovells. The discussion of the future role of associates is especially interesting, and several useful links are included.

 

  • Investment money pouring into legal AI. “Legal tech blogger Bob (“God”) Ambrogi just posted that $200 million in new investment capital has found its way to legal tech companies in just May and June of this year. The money went into companies that are either based in machine learning (sometimes called “artificial intelligence”), an increasingly important sector of legal technology.” The post from the Akron Legal News lists some of the specific investments.

 

  • According to Bloomberg’s Big Law BusinessAnalytics Give Law Firms the Competitive Edge. “Bob Ambrogi’s Law Sites Blog lists more than 690 legal tech start-ups that are either currently active or have closed or been acquired. He only began keeping count in 2016.” The article goes on to report to report the results of a 2017 survey of 1117 respondents, including findings such as, “(b)y providing structure and visualization to information, technology is enabling attorneys to understand past results and forecast costs, time to resolution and outcomes — and thereby better serve their clients and operate their organizations more successfully.” The article includes a lot of interesting data, showing the success to-date of AI. Here’s a link to the full report by Above the Law. The survey was conducted back in October 2017, and results are reported with some care regarding statistical integrity. All that’s missing to have high confidence in the findings is an idea of the response rate; that is, how many were asked to participate in order to achieve the 1117 responses.

 

  • This post by Ron Friedmann (Legal Transformation or Disruption? A New Rule for Talking About It) is a suggestion for mitigating the extreme hype now plaguing discussions of legal AI and tech in general. It’s a step in the right direction, but is still subject to personal judgement (and hyperbole). I do not have a better idea.

 

  • This post (Baker McKenzie’s Growth Shows Value of One-Stop Legal Shopping from Bloomberg Big Law Business) includes: “(t)he firm also recently adopted artificial intelligence tools in 11 offices in three continents as the first step in a worldwide rollout. This will allow faster, more comprehensive review of merger and acquisition work, and other work involving contracts, the firm said.”

 

  • As I visit law firms, I am asked more and more about the Big 4 accounting firms’ encroachment into the legal space. This threat has been popping up since the days of the Big 8, but has more substance today than ever before. For instance:

Breaking: Big Four firm buys services ‘disruptor’ Riverview. “Global accountancy giant EY today laid down a significant marker in its expansion into legal services with the capture of forward-thinking firm Riverview Law.” … “The deal marks another step in what has long been predicted would be the rise of the ‘Big Four’ accountancy firms to rival – and possibly overtake – the biggest existing law firms. Each of those four, EY, KMPG, PwC and Deloitte, now provide reserved legal services.” Coverage here and here. “EY said the acquisition underlines its position “as a leading disruptor of legal services” and will “help clients to increase efficiency, manage risk, improve service transparency and reduce costs of routine legal activities.”

And the same day, KMPG published, “In the legal sector, this disruption presents vast challenges as firms struggle to move from traditional hierarchies, manual research requirements, time-based billing models, and other traditional ways of operating, into tech-empowered models fit for the future.” “Adapt or fall behind. Now is the perfect time to reimagine every layer of the workplace to future proof the legal profession.”

 

  • Here’s an interesting application of AI from Seyfarth Shaw: Australia: New Transparency: Using Collaboration And Technology To Address Modern Slavery. “Mining data (for example, from mobile phones, media reports and surveillance cameras) which can be analysed using artificial intelligence and machine learning to extract meaningful information and identify risks in the supply chain.”

 

  • From The Atlantic, this interesting application of sentiment analysis. The AI That Reads All a Company’s Emails to Gauge Morale. The very interesting article discusses text analysis generally and is definitely worth reading.

 

  • Canada’s Miller Thomson postedArtificial Intelligence Revolution and the Insurance Industry. “AI may soon be heavily used in all aspects of the insurance industry, including sales, customer service, underwriting, claims assessment and fraud detection and prevention. AI has and will continue to be used in the area of insurance marketing.”

 

Blockchain

  • From ForbesTrust, Security And Efficiency – How Blockchain Really Intersects With Artificial Intelligence. “Blockchain, though powerful on it’s own, becomes enhanced to a whole new level when coupled with AI technology. New features and capabilities become unlocked, enhanced, and more secure through the convergence.” Several instances of this synergy are discussed, but there’s no real insight as to how they will actually work together.

 

  • Get smart: blockchain will liberate lawyers. Sounds good, no? This post from the UK’s Law Society Gazette, focuses on smart contracts and details several concerns and limitations thereof, including use of imprecise terms such as “reasonable.”

 

  • This piece from ComputerWorld (By 2020, 1-in-5 healthcare orgs will adopt blockchain; here’s why) reviews several applications of blockchain in healthcare. It’s a deep dive into the pros and cons, and describes several applications, including smart contracts. “Blockchain lets the healthcare industry exchange data in a standard format, automate complex processes and apply AI against large silos of medical data. It might even allow patients to sell their data for rewards.”
  • Easily the most reported AI story in the past few days has been: UK & France sign major deal for AI & Cyber Security cooperation. “The plan will see the UK’s national institute for data science and artificial intelligence, The Alan Turing Institute, partner with French counterpart DATAIA on research and funding initiatives.” Coverage here, here and here.

This post from Artificial Lawyer takes an in-depth look at the British Government’s support of legal tech per se.

– Another perspective on the UK’s attitudes and uses of tech in law is presented in this post: “Imagine Y Combinator of the tech world fame, but inside a law firm with open access to the partners, associates, technology infrastructure, and staff.” “…(S)ince the passage of the 2007 Legal Services Act, which allows non-attorney ownership of law firms (also known as an ABS structure) there has been an explosion in innovative business models combining great lawyers, business professionals, and technologists (think Riverview Law). UK Biglaw also seems to get that times are changing.”

 

  • But, while the UK and France are planning to become more competitive in AI, here, from CB Insights are the nine companies who have been acquiring AI startups:

 

  • Also from Europe: “Researchers from the European University Institute have developed a tool designed to use artificial intelligence to scan companies’ privacy policies to identify violations of data protection laws….”

 

  • Singapore’s government is also committed to investment in AI, in this case, specifically legal AI. “The city-state’s government has established programs to advance innovation in the legal profession. Can Hong Kong, Asia’s other financial center, catch up?”

 

  • Here, from Thomson Reuters, are more thoughts about use of AI in smaller firms. “So, what can a small law firm attorney do to gain the insights of large law firms and more experienced attorneys? The answer is artificial intelligence.” Much of this post is taken from their eBook, “Not All Legal AI Is Created Equal.

 

  • One of the ways AI is expected to become available to smaller organizations is ‘AI as a service’ (AIaaS). This area is expecting rapid growthWorldwide Artificial Intelligence as a Service (AIaaS) Market 2018-2023: A $10.88 Billion Opportunity – ResearchAndMarkets.com.

 

  • Gowling has come up with an interesting way to get its employees comfortable with blockchain. “International law firm Gowling WLG has introduced a new blockchain-based peer-to-peer recognition scheme for 1,178 UK employees working at its London and Birmingham offices. The Gowling WLG Reward Token scheme (GRT), launched on 2 July 2018, was designed internally to educate employees about blockchain technology and help staff to earn and share rewards.” More here.

 

  • This (Vera Cherepanova: AI doesn’t solve ethical dilemmas, it exposes them) is an interesting read and unusual perspective about AI and ethics, focused on compliance applications and implications.

 

  • Here’s more coverage of China becoming a ‘surveillance state’. “In some cities, cameras scan train stations for China’s most wanted. Billboard-sized displays show the faces of jaywalkers and list the names of people who can’t pay their debts. Facial recognition scanners guard the entrances to housing complexes. Already, China has an estimated 200 million surveillance cameras — four times as many as the United States. Such efforts supplement other systems that track internet use and communications, hotel stays, train and plane trips and even car travel in some places.” The specific examples are fascinating.