By Jason Moyse
You might be forgiven if you are tired of hearing about machines versus lawyers, but the topic, much like our future robot overlords, is not about to be put to rest. Similarly, the definition of legal work and the practice of law are subject to more scrutiny than at any prior time in the history of the “profession” (air quotes intentional). As self-governing guilds, law societies and U.S. bar associations (which aren’t really regulators) are being confronted with uncomfortable questions requiring clear answers to plainly laid out (non-virtual) reality.
If a task can be completed entirely by a machine, is it the practice of law?
This question usually comes up in the context of e-discovery and whether the tasks performed by document reviewers are legal work requiring a licence to practise. The stakes are usually whether or not a reviewer is an employee or a professional services provider. In the most well-known U.S. case involving David Lola — a reviewer seeking overtime pay that would not have been payable if he were deemed to be practising law — both parties agreed that an individual who undertakes tasks that could be performed entirely by a machine cannot be said to engage in the practice of law. That seems entirely reasonable with ironclad Vulcan rationality.Let’s then extend the reasoning to companies themselves who are nothing if not legal persons, as taught in first-year law school. Consider those that offer legal services by relying on technology to synthesize and package data without any commentary, editorial or advice.
Data Science in LegalTech
Through our work at Law Made, we see many companies that have a product using data science in the following way:
(1) A body of unstructured, open-source data is accessed, perhaps a cache of case law or court records, for example.
(2) A combination of machine learning or artificial intelligence is used to review the data and synthesize an analytical outcome based on search criteria entered from an end user.
(3) The end user interprets or decides what to do with the results.
The above steps could assist in determining what a reasonable settlement amount might be in a family law case, a civil personal injury case or any area where a body of decisions is available, and awards are typically granted on an established set of criteria. In many areas of law, outcomes are determined by tables, regulations and ranging guidelines and not just an evolving body of subjective case law precedent.
Nowhere in this scenario is work being provided by anything other than a machine. At most, and not necessarily as a requirement, perhaps lawyers helped design the questions to be answered on the front end, but they are not called upon to “exercise legal judgment” in determining the outputs.
If there are 15,000 cases that can be whittled down to three similarly situated scenarios based on search terms or even a narrative posed question, the settlements — including division of assets in family law cases — are simply a matter of algorithm and/or data extraction. That’s not subjective legal advice, that’s mathematical reality.
Yet, regulatory bodies, especially in Canada, would at minimum seek to investigate whether that was in fact the unauthorized practice of law — meaning work that should be completed either by a law firm or individual lawyer. We know that these types of investigations are taking place. What we don’t know is whether they will actually be dispensed with in a timely fashion. Hopefully, the law societies and U.S. bar associations are more concerned with actual behaviour such as breach of trust rather than low-priority investigations attempting to determine if technology-led service providers are acting as lawyers.
There is likely no bad faith when law societies and U.S. bar associations are reviewing any particular legal technology or legal services company. However, unless the company is well resourced, absent an unlikely quick turnaround time, it will not survive an investigation for any significant length of time. The cash will either run out or the company will be held in an awkward limbo as to whether it can continue to follow its strategic plan. So, even an “innocent” company can die in a holding pattern.
Here’s another question, bordering on heresy to the legal-minded:
Do the decisions of courts, tribunals and regulatory bodies in relation to legal technology or unauthorized practice of law really matter in the face of overwhelming traction by end users?
While this company offers some services in Canada under an obvious rebrand of a prior existing Canadian business, its more compelling footprint is in the U.S. and, increasingly, England.
In large part through the use of automation technology, LegalZoom helps users create legal documents for personal and business purposes. Consumer services relate to wills, divorce, prenuptial agreements, personal bankruptcy, immigration, disability benefits, personal injury and real estate documents. For business services, mostly to small and medium-sized entities, LegalZoom assists with incorporation documents, tax forms, licences, corporate changes and filings, real estate transactions, trademarks, patents, copyrights and business compliance.
If you lived in the U.S., chances are you know LegalZoom, perhaps as a consumer, but certainly as a lawyer.
The statistics are staggering and impossible to ignore. Information is not always readily available, but 2011 court documents indicated two million customers at that time, which has undoubtedly grown.
That same year, in the state of California, 20 per cent of all newly formed limited-liability corporations utilized LegalZoom.
The legal battles for and against LegalZoom have been well documented. Most famously, the North Carolina bar claimed the company was conducting the unauthorized practice of law. LegalZoom filed a US$10.5-million anti-trust suit, which was settled based on conditions that the company was largely already following.
Although its availability and exact service varies between jurisdictions, Uber is here to stay. It’s the Internet entrepreneur’s playbook to start a business: Drive huge adoption, then deal with the regulators only as necessary. While it has had many battles, LegalZoom’s North Carolina case was “bet the company” and it essentially succeeded in that forum as it has in winning a massive customer base.
The primary rationale behind lawyer self-regulation is to protect the “public interest” and to provide consumers with protection against untrained and perhaps nefarious poseurs. This does not apply to purely computational processes.
Are regulators and bar associations saying the public is too dumb to choose the right legal service providers or is it a matter of protecting vulnerable consumers? Just as taxi regulation is dubiously connected to protecting consumers and results in inferior client experiences, so, too, does that apply in law. LegalZoom is successful because millions of customers have made it so, even in the face of alternatives and opposition from those out to protect the ill-defined “public interest.”
Rather than regulating the providers, maybe a form of “accredited user” should be employed the same way that sophisticated “accredited investors” are afforded wider latitude to make their own choices.
The professional services firms that utilize:
Similarly, neither do in-house legal departments that utilize technology tools. By extension, neither does any business unit in a large corporation, even if it has no lawyers or other professionals.
Another take on this is the formation of
Riverview Law (an alternative business structure in the U.K.), the parentco of kim, has transitioned away from being a legal services provider enabled by technology that is unable to carry on business in North America. Since Kim Technologies is simply a technology business with deep legal domain expertise, it is not restricted from operating in North America like its parent.
While the silly season of conferences and legal press writing focuses on robots replacing lawyers, the reality is that consumers are actually suffering in the face of protectionist self-regulation of lawyers. The current situation is that the general public is underserved while s remain underemployed, especially among those just starting out. Most illogical, Captain.
A version of this article originally appeared in Canadian Lawyer Magazine.