Welcome to your Law Tech briefing for June 9th, 2023, covering what happened in legal tech recently.
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Have less than a 1 min? Three takeaways from yesterday
1. The legal tech industry is rapidly evolving, with AI playing an increasingly significant role in processes like business development and litigation. Law firms must be proactive about keeping up with emerging trends.
2. While generative AI is gaining traction among lawyers, there is a significant gap in the adoption of AI between practicing lawyers and law students. Legal knowledge workers must be aware of the potential challenges this gap poses and work to incorporate AI into their processes where appropriate.
3. As the use of AI in the legal industry becomes more widespread, it is important to consider the ethical and regulatory implications of this technology carefully. Law firms must remain vigilant about the risks posed by AI and work to integrate it into their processes in ways that prioritize the interests of their clients and the broader legal community.
Trends from yesterday
In yesterday's legal tech news, London-based AI business development platform Kula secured funding from investors, and Onna became the first external eDiscovery product to be made available on Google Cloud Marketplace. Additionally, AI and its impact on the legal industry was a recurring theme, with two lawyers, who we covered last week, facing sanctions for submitting fake opinions generated by an AI chatbot, and a survey revealing that while generative AI is gaining ground among lawyers, only 9% of law students currently incorporate it into their studies.
The use of generative AI is on the rise among lawyers, with many incorporating it into their work processes. However, there is a significant gap in the adoption of AI between practicing lawyers and students. This suggests that while AI technology is being embraced by the legal industry, it may take longer for it to become part of the formal curriculum - is this what the world was like when Wikipedia was looked down upon as a reference in educational settings? In light of the potential dangers raised by the investigation of two New York lawyers who submitted fake AI-generated legal opinions to a court, ethical considerations around the use of AI are also in focus.
The expansion of Nextpoint Law Group and Kula's successful funding round demonstrates the continued growth of data-driven solutions in the legal tech space. With the need for remote working solutions, the use of cloud-based providers is also highly desirable, highlighted by Onna's announcement of integration with Google Cloud. The slow uptake of generative AI by law students may challenge the legal industry as new technologies emerge. However, the discovery that two lawyers submitted fake legal opinions generated by AI brings up significant ethical concerns regarding the use of AI in the profession.
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A new survey by legal tech company LexisNexis revealed that only 9% of law students are using generative AI in their studies, and only a quarter are considering incorporating it into their work in the future. This is a significant contrast to the growing trend of lawyers using ChatGPT and other large language models. There is a need to look into why the technology is not as prevalent among law students, and Serena Wellen, senior director of product management for LexisNexis North America, examines the reasons behind this in her article "Learning the Law with AI: Why Law School Students Are Tentative about Using ChatGPT." The reluctance of law students to adopt generative AI technology in their studies could impact their preparedness for future jobs, and it is crucial for legal tech companies to identify and address the underlying concerns of students.
Mayer Brown has established a Technology General Counsel in Residence program, following the lead of venture capital firms in setting up entrepreneur-in-residence positions. Beth Stevens, a veteran general counsel of several high-growth technology companies who worked with Mayer Brown on various projects over the years, was the inaugural participant from January to April this year. From her perspective, Stevens supported Mayer Brown lawyers to understand better how to collaborate with in-house counsel, revealing a desire to see law firms benefitting from an insider understanding of business issues facing early-stage and venture capital companies. Mayer Brown is now seeking other general counsel to participate in the initiative, which legal industry experts describe as being a helpful pause for in-house lawyers who are considering their career options.
The recent revelation that a lawyer submitted a brief in federal court containing several nonexistent cases raises concerns about the potential misuse of AI by legal practitioners. The attorney used ChatGPT to write the brief without verifying that the cases it cited and quoted were accurate. This likely happened because the lawyer underestimated the reliability of ChatGPT in generating citations. While AI can supplement and enhance the efficiency of the research and writing process, it should not replace the expertise of legal professionals. Clients hire attorneys for their education, skills, and experience, and they expect to benefit from the services of a human professional. As AI-powered tools become more common in legal practice, it is essential for lawyers to be aware of their limitations and use them with care without relying solely on them.
Onna has become the first external eDiscovery product to be made available on Google Cloud Marketplace. The US eDiscovery provider has partnered with Google Cloud for several years and its platform integrates with content, collaboration and communication applications such as Google Workspace, Slack, Office 365, Confluence and Jira. Onna also announced upcoming support for Google's own eDiscovery offering Vault. In another development, cloud-based eDiscovery provider Nextpoint has launched Nextpoint Law Group, an Arizona ABS law firm offering data-driven solutions for litigation, taking advantage of deregulation in Arizona.
Kula, a London-based AI business development team for law firms, has secured funding from Y Combinator, Entrepreneur First, and other investors. The company uses large language models and unique legal data from public sources to match lawyers with potential clients. Kula works with 100 law firms across five continents, targeting partners or owners of law firms who want to serve SMEs, investors, and venture-backed companies. The company pivoted from building a legal services marketplace to an AI business development team, educating the market on the first application of AI to legal business development.
Two lawyers from New York law firm Levidow, Levidow, & Oberman are facing potential sanctions for submitting fake opinions generated by an AI chatbot, ChatGPT, to the court. The lawyers used ChatGPT to research a legal issue and claim the mistakes were inadvertent. However, they are set to appear before US District Judge Kevin Castel to explain why they should not be sanctioned for violating Rule 11(c)3, which requires good faith.
The UK Competition and Markets Authority (CMA) has responded to the government's AI White Paper consultation, stating its support for the proposed non-statutory regime for AI regulation. However, the CMA suggests that direct statutory intervention may be necessary in the future. The CMA also calls for cross-regulator collaboration and central coordination to manage the challenges of new technologies. The response aligns with the Information Commissioner's Office's own response to the paper in April 2023.
Oosha, a UK-based legal IT managed service provider, has been rebranded as Access Managed Services after its acquisition by Access Legal in 2021. The company aims to expand its team by 20%, with a focus on increasing its IT service engineer team to support its core operations, security, and support functions. The move comes as more law firms prioritize investment in legal technology and IT services due to hybrid working and hybrid cloud strategies playing a key part in their success. Access Legal is part of The Access Group, a leading provider of business management software.
San Francisco-based legal tech start-up EvenUp has raised $50.5m in a Series B funding round led by Bessemer Venture Partners. The company uses AI to create demand packages for personal injury lawyers, using data from over 250,000 verdicts and settlements to analyse medical records. EvenUp has also launched Litty, an AI legal assistant for PI lawyers, and announced a deep integration with legal practice management platform Litify. The latest funding will support growth, deepen the functionality of its platform, and develop new technologies and products for PI and other fields of law.
A recent survey by LexisNexis has found that the use of generative AI, such as ChatGPT, is increasing among lawyers, but law students are the least likely to use it. Only 9% of law students currently use generative AI in their studies, and just 25% plan to incorporate it in their work. The article "Learning the Law with AI: Why Law School Students Are Tentative about Using ChatGPT" by Serena Wellen, senior director of product management for LexisNexis North America, explores the reasons behind this hesitancy.