$1B double acquisition
Reveal completes purchases of Logikcull and IPRO, signaling sector consolidation. AI continues to drive legal tech innovation, outlined at the ILTA conference.
Welcome to your Law Tech briefing for Aug 30th, 2023, covering what happened in legal tech recently.
TLDR; Listen instead:
Have less than a 1 min? Three takeaways from yesterday
- The integration of Clio with Google Ads offers a unique opportunity for law firms to grow their practices. The pay-per-lead model promises substantial ROI, as firms only pay when potential clients interact with their ads. This tool is expected to expand client reach and manage ad expenses efficiently.
- Legal Tech companies are showing a tendency toward consolidation for improved control and better service provision. This trend is shown through Reveal's acquisition of Logikcull and IPRO, signifying a strategic growth plan that aims at giving clients improved control over their eDiscovery workflows.
- In light of the recent $6 billion mass tort settlement involving 3M, law firms should be prepared for a shift in tort liability cases. Even though no liability admission was made, the settlement acts as a precedent that could influence future mass tort cases. Therefore, law firms need to pay close attention to such landmarks.
Briefing
Here's what happened in legal tech recently...
The most prominent announcement came from legal tech company Clio, which unveiled its integration with Google Ads. This fresh feature allows law firms to manage ad expenses, advertise on Google Search, and capture local leads all within the Clio platform. The tool employs a pay-per-lead model, which means attorneys will only have to pay when potential clients interact with their ads. Currently, the service is only available to US-based firms operating in specific areas. Meanwhile, Chicago's eDiscovery firm, Reveal, completed the purchases of Logikcull and IPRO, in deals exceeding $1bn, supported by its major shareholder, K1 Investment Management. 3M announced a historic $6 billion mass tort settlement over allegations of safety concerns arising from battlefield earplugs produced by Aearo Technologies, a company 3M acquired.
TRENDS
Artificial Intelligence (AI) continues to dominate various facets of legal tech, from automating processes to improving data security, with generative AI identified as a defining subset. The use of AI was highlighted in this year's ILTA conference, with startups like Aiden Technologies, Legatics, DeepJudge, DraftWise, and Capacity, among others, presenting their unique AI-powered products. Important discussions around cybersecurity in parallel with AI developments and automation were also evident across the sector. AI tools like Aiden have shown potential to boost cybersecurity by scanning software binaries for vulnerabilities and rebuilding non-compliant machines.
ANALYSIS
The integration of Clio and Google Ads signals a promising shift for law firms. It presents a unique and cost-effective opportunity for lawyers to expand their reach and grow their practices. Given the cash-per-lead model, attorneys can be confident that their ad spend matches real customer engagement, offering potential significant ROI. Reveal's acquisitions of Logikcull and IPRO illustrate a strategic growth plan and a desire for consolidation within the legal tech market, aiming to provide clients with improved control and choice over their eDiscovery workflows. Finally, in the wake of the $6 billion 3M settlement, law firms need to brace for a new dynamic in tort liability cases. While the settlement does not involve an admission of liability, it acts as a milestone and will likely influence future mass tort cases.
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Key stories
In A $1B E-Discovery Acquisition Double-Play, Reveal Acquires Both Logikcull and IPRO (LawSites)
Reveal, a global e-discovery firm, has acquired legal tech companies Logikcull and IPRO in a deal worth over $1 billion, funded by majority shareholder K1 Investment Management. Reveal claims the move will create the first full-service e-discovery platform catering to all legal teams. Logikcull and IPRO's specific capabilities will merge with Reveal's AI technology to form a centralized hub, handling everything from small, self-service cases to large, complex legal challenges. The acquisition extends Reveal's offerings to cover all stages of the e-discovery process and will allow them to serve diverse clients, from SMBs to multinational enterprises. The combined company will also gain employees in over two dozen countries and a customer base of 4,000 clients.
Sebastian Forgues, associate general counsel and chief counsel, innovation and emerging technologies at MITRE, suggests that lawyers can reprioritize the functions of contracts to balance risk mitigation with behavior-driving, encouraging greater innovation. He suggests three ideas: "talk less and listen more," allowing the creative energy of business to drive negotiations; "start with yes," assuming agreement without unneeded conditions or restrictions; and "address the rest," identifying and mitigating execution risks in a prioritized manner. While the ideas are simple, Forgues acknowledges potential difficulties but advocates for a gradual repositioning towards these principles, a shift he believes could unlock companies' innovation potential.
All stories
Legal tech company Clio has launched a new feature integrating with Google Ads, allowing lawyers to advertise their services on Google Search, manage ad expenses, and generate local leads within the Clio platform. The pay-per-lead model ensures lawyers are charged only when potential clients reach out through a local Google ad. This innovation is anticipated to significantly boost law firm growth and increase the demand for legal services.
Clio, a law practice management firm, has incorporated Google's Local Services Ads into its client management software, Clio Grow. This integration enables law firms to handle their ad campaigns, capture leads, and assess performance all within the software. It positions Clio as the sole law practice management software offering built-in digital advertising. The service is presently accessible only to US law firms in certain practice areas.
ILTACON 2023, the International Legal Technology Association's annual conference, successfully attracted over 3,400 attendees and 158 exhibitors despite the challenging Orlando weather. Attendees praised the diverse topics and high-quality speakers. The legal tech industry's dynamism was evident, especially around generative AI. However, the event's smart badges, Klik, faced criticism for possibly not recording all contact exchanges.
Healthcare GCs at public companies can make upwards of $1.6M (Legal Dive - Latest News)
General counsels (GCs) at public healthcare companies earn twice as much as those at private firms, largely due to long-term incentive pay, according to a BarkerGilmore survey. The study, which collected data from 500 individuals in various healthcare and life science sub-industries, also found that a top 50 law school education and law firm experience significantly increase GCs' compensation. Similar trends were observed for managing counsel and senior counsel positions.
3M settles largest mass tort case ever (Legal Dive - Latest News)
3M has agreed to a $6 billion settlement, the largest in mass tort history, over safety issues related to battlefield earplugs manufactured by Aearo Technologies, a company 3M acquired in 2008. The settlement, which does not involve an admission of liability, will be paid between 2023 and 2029. The company has lost 10 out of 16 bellwether cases and also faces separate tort liability over its use of 'forever chemicals'.
Chicago's eDiscovery company, Reveal, has acquired Logikcull and IPRO in transactions exceeding $1bn, funded by its majority shareholder, K1 Investment Management. The acquisitions form part of Reveal's growth strategy to incorporate top technologies into a single platform, offering clients improved control and choice over their eDiscovery workflows. The combined companies aim to provide a comprehensive eDiscovery platform for all legal teams.
Gen AI: Peak hype doesn’t mean you should sit back and wait (Legal IT Insider)
Legal tech expert Casey Flaherty has stated that despite the hype around generative AI, its advancements are significant, indicating a new super cycle. He advised companies to stay ahead of the curve, even with potential risks of failure or privacy breaches. Flaherty emphasized the importance of companies exploring and experimenting with generative AI technologies.
The International Legal Technology Association (ILTA) held its annual conference, ILTACON, featuring a Startup Hub where 27 legal tech startups presented their products. The author interviewed 12 startups, including Aiden Technologies, Legatics, DeepJudge, DraftWise, and Capacity, among others. The interviews will be broadcast over two episodes of the LawNext podcast, with the next episode featuring discussions with established legal tech firms.
The legal tech industry's emphasis on AI has unintentionally downplayed the crucial role of cybersecurity in law firms. AI tools like Aiden can significantly boost cybersecurity by scanning software binaries for vulnerabilities and rebuilding non-compliant machines. This process increases visibility, speeds up patches, minimizes reboots, and drastically reduces vulnerabilities, proving AI's effectiveness in enhancing cybersecurity in the legal sector.
The surge in privacy-related lawsuits regarding data privacy violations from website tracking technologies has led to increased demand for law firms specializing in data privacy. Industries such as healthcare and video streaming are being sued for sharing sensitive data without user consent. Law firms can gain a competitive edge, enhance client relationships, and offer additional services by utilizing privacy software that automates data discovery, making case handling more efficient.
Legal technology firm Clio has achieved recognition from all 50 US state bar associations, highlighting its commitment to professional standards and regulatory understanding. This comes as Clio celebrates its 15th anniversary, having pioneered the first cloud solution for law firms and setting a benchmark in legal tech innovation. Additionally, Clio donates over $25 million worth of free software to legal institutions each year through its Academic Access Program.
AI-powered eDiscovery platform provider, Reveal, has acquired Logikcull and IPRO, forming the first comprehensive eDiscovery platform for legal teams. The deals, valued over $1 billion, were financed by K1 Investment Management, Reveal's majority shareholder. This merger will create a one-stop hub for eDiscovery tools for all legal issues, and introduce AI-powered eDiscovery solutions to a new global legal market.
Dean Andrew Perlman, a leader in law and technology at Suffolk University Law School, has been appointed to the American Bar Association's (ABA) AI Task Force Advisory Council. The task force is dedicated to understanding the legal implications of AI and machine learning systems. Perlman will assist in ensuring AI integration in law meets legal standards. The group will explore AI's effect on the legal profession, risk management, legal access, governance, generative AI issues, and legal education.
