Embracing AI in Legal Practice

The foray of artificial intelligence (AI) into the legal sector has begun with intriguing yet cautionary tales, reflecting the legal profession's traditional and careful nature. Lawyers, known for their judicious approach and adherence to conventional practices, are often intrigued but skeptical about new technologies like AI for lawyers. A compelling instance of this careful integration of AI in law was seen with Steven Schwartz, a personal injury attorney at Levidow, Levidow & Oberman in New York. Schwartz's experience with ChatGPT, an AI chatbot, for drafting a court motion, serves as a prime example of the potential pitfalls in hastily adopting AI tools in legal work.

ChatGPT Lawyers Are Ordered to Consider Seeking Forgiveness - The New York Times

Schwartz's over-reliance on the AI tool resulted in a motion filled with fictional cases and rulings. His unquestioning trust in the AI's authenticity underscores the importance of scrutinizing AI-generated content in legal AI applications. This incident amusingly yet significantly highlights the need for due diligence when integrating AI in legal tasks.

Legal AI: Risks and Rewards

Contrary to the belief that Schwartz's mishap indicates the supremacy of traditional legal methods over AI, the reality suggests a more complex narrative. The flaws in Schwartz's brief weren't a direct failure of AI, much like typographical errors aren't inherent failures of a printing press. The core issue lay in the absence of lawyerly review of the AI-generated content. In its developing stages, AI for lawyers is not merely a trend or a threat but a tool with vast potential to revolutionize legal work and the economics of law firms. This potential, however, is accompanied by significant risks, particularly in a field as sensitive as law. Law firms that effectively utilize AI in law could gain considerably, while those that do not may face obsolescence, akin to traditional typesetters in the digital age.

A Goldman Sachs report emphasizes the significant impact of AI on the legal profession, estimating that 44% of legal tasks are susceptible to automation by AI. This percentage is notably higher than most other professions, with the exception of clerical and administrative roles. Lawyers engaged in detailed document reviews could benefit immensely from AI capabilities, aligning well with the strengths of legal AI technology. Currently, AI is employed in various legal tasks such as due diligence, research, and data analytics, primarily through 'extractive' AI systems adept at efficiently extracting specific information from texts.

The rise of 'generative' AI systems like ChatGPT heralds a more significant transformation. These advanced legal AI tools are capable of not just extracting information but also generating content and interpreting the context in legal documents. Innovations like CoCounsel and Allen & Overy's AI tool Harvey demonstrate how generative AI transcends traditional keyword-based research methods in legal practice, offering more nuanced and contextually aware solutions.

AI Lawyer, an innovative service catering to general legal practice, further enriches the legal AI landscape. Designed to create legal documents, provide summaries, and conduct comprehensive research on various legal topics, Advogado de IA presents itself as a versatile tool for legal professionals.

Despite these advancements, skepticism remains among some practitioners. A survey shows that while a majority recognize the potential of generative AI in legal work, only about half endorse its usage. Concerns include inaccuracies generated by AI, or 'hallucinations', and the risk of breaching attorney-client privilege. Nonetheless, these issues can be mitigated with advanced technology and careful human supervision.

The lesson from Schwartz's experience is crucial for the legal community. Following this, a Texas federal judge now mandates attorneys to certify their use of generative AI in court filings, ensuring thorough review of AI-generated content. This requirement mirrors the shift from traditional library research to digital databases like Westlaw and LexisNexis. As the legal industry increasingly adopts and demonstrates the effectiveness of generative AI, it's likely that legal AI will become a more integral part of legal practice.

Legal AI: Transforming Litigation Dynamics

Artificial intelligence (AI) is on the brink of revolutionizing the legal sector, particularly impacting the dynamics of large-scale litigation. In traditional legal practice, major law firms have leveraged their large teams of associates to undertake extensive document reviews in complex cases, a process that typically involves analyzing millions of pages. This labor-intensive approach has historically given larger firms an advantage. However, the emergence of litigation-preparation AI tools is set to dramatically alter this scenario. Such tools are enabling even solo practitioners and small firms to efficiently process substantial volumes of documents, thus leveling the playing field. Lawrence Lessig of Harvard Law School highlights how these technological advancements empower smaller, more specialized firms, enabling them to handle extensive cases more competently and with less dependence on a large workforce. This democratization of access to advanced legal resources through legal AI not only makes legal services more efficient but also more accessible.

AI and the Economics of Law Firms

The impact of AI extends to the economic models underpinning law firms. Richard Susskind, a technology adviser to the Lord Chief Justice of England, notes that traditionally, law firms have capitalized on the differential between what they pay junior lawyers and what they charge clients. With AI capable of performing many tasks in a fraction of the time, the need for large numbers of junior lawyers is diminishing. This shift compels law firms to rethink their billing strategies. Stephen Wu from Silicon Valley Law Group suggests a move towards fixed-rate charges based on the services provided rather than the time spent, or even the introduction of a "technology fee" to reflect the value provided by AI tools in legal services.

Moreover, the efficiency of AI has implications for the structure of the legal workforce. Lessig speculates that the enhanced efficiency brought about by AI could significantly reduce the global demand for lawyers. If AI can achieve in seconds what previously took dozens of associates weeks, the traditional model of hiring large numbers of junior lawyers becomes less justified. A senior partner at a New York corporate law firm predicts a shift towards a more balanced ratio of associates to partners, contrasting sharply with the current norm in top-tier firms. However, this shift might not be immediate.

AI's role in democratizing legal services is a critical aspect of its impact. It promises to make legal advice more affordable, particularly for small and medium-sized businesses. Paradoxically, this could lead to an increase in the number of lawyers, as AI enables recent law graduates to start solo practices more feasibly. This is reminiscent of how the introduction of ATMs led to an increase in the number of bank employees, rather than their replacement.

Don Wetzel, inventor of the ATM, left, will be in Rockville Centre for a 50th anniversary celebration on Sept. 6.

In summary, the transition to AI-driven legal services is poised to benefit clients significantly. As Richard Susskind points out, clients primarily seek resolutions to their problems, which AI can efficiently provide. This adoption of AI in law is akin to the widespread use of software for tasks like tax preparation, where the emphasis is on efficiency and effectiveness rather than on personal interaction with professionals. The move towards AI for lawyers signifies a fundamental shift towards efficiency and accessibility in the legal profession, heralding a new era in the delivery and utilization of legal services.