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How Artificial Intelligence Is Transforming the Legal Services Industry of Asia

How Artificial Intelligence Is Transforming the Legal Services Industry of Asia


Machine Learning, a subset of Artificial Intelligence has been growing in the last 5 years. The intersection of advanced software and acceleration in hardware capabilities has provided an inflection point for AI systems. Evidently, AI systems can now learn faster, predict with more accuracy and perform tasks that they haven’t tried yet. [1]



AI and ML is a natural solution for any knowledge-driven industry wherein a large amount of new data is repeatedly produced. New data requires standardization, classification, summarization and storage, all of which are tasks best suited for AI/ML implementation. The legal field exhibits all of these salient features and is therefore a prime contender for an industry that will be going through a transformative change through the application and use of AI.

Once we gain an understanding of how AI/ML is currently being used, we can figure out its possible applications in the legal industry, as well.

AI/ML impact growing across Asia

China

a.     Wusong Technology is one of the leaders in China, working on digitizing the way Courts function using AI-enabled robot-chatbot called “Fa Xiaotao”, which offers users case analysis and helps them locate lawyers. At the end of 2016, Wusong raised US$17 million Series B round funding, making it one of the biggest investments for legal tech in the world. [2]

b.     In October 2017, the lawsuit center at Beijing No 1 Intermediate People’s Court attracted widespread attention when a robot called Xiao Fa was put into operation. The robot can answer questions verbally or take queries on its screen with a touchscreen or keyboard and also print documents out. [3]

Singapore

  1. In September 2017, one of the leading law firms of Singapore, the Wong Partnership also embraced AI technology from London-based AI firm Luminance to support its corporate/M&A practice. The firm uses the technology for due diligence of M&A transaction documents and to highlight sections that required human review and intervention. [2]
  2. The Singapore office of Law firm Linklaters has been working with a software company, Eigen Technologies, to develop Nakhoda, an artificial intelligence (AI) program that uses natural language processing, in which computers can recognise and respond to human language to read text contracts and documents such as NDAs. [4]

South Korea

  1. South Korean law firm Yulchon brought in Carl Im, who holds a doctorate in theoretical physics from Stanford University and once worked as a derivatives trader at Goldman Sachs, as a senior adviser. He now helps Yulchon develop technology that provides low-cost compliance tools, including apps, for clients. The firm is also encouraging its lawyers to create new solutions themselves. [4]

India

  1. One of India’s leading firms, Cyril Amarchand Mangaldas are now leveraging the power of AI for contract analysis and review by partnering with Canadian AI assistant Kira Systems [5]
  2. Few start-ups, such as CaseMine and my very own NearLaw are trying to reinvent legal research. Our AI/ML features include VisualSearch and the CaseRanking algorithm to show the most relevant cases quickly. The algorithm sorts and ranks over 300,000 case records across 20+ Courts/ Tribunals to come out with the top 50 cases. The unique approach elegantly identifies the key 0.01% of cases that are relevant to the user. Handy event timelines and an automatic summarization algorithm help us solve the “depth” problem as well.

AI/ML Use Cases in the Legal Industry

The immediate application of AI for Legal Practitioners and Judges are in 3 distinct aspects:

  • Natural Language Processing (NLP) for Case-law and Law Code Research:

Legal Research is an essential service for the smooth functioning of the legal services market, a $83.7 size in 2016 with a CAGR of 3.9% between 2012 and 2016 [6] . Lawyers, while arguing cases need to delve deep into legal research of hundreds of relevant cases and peruse thousands of pages of decisions to deduce the right cases that are in favour of their client’s motion or application. Conversely, lawyers also need to know the opposing view and the supporting case-law justification, so they can prepare a defensive mitigation strategy.

  • Predictive analytics and Visualization:
    1. Visualization: Leveraging big-data analytics to visualize case data in a networked map of which cases are cited in other cases and whether they lead to a positive or adverse verdict.
    2. Predictive Analytics to process relevant data in a combination of AI/ML models to predict the probability of a positive outcome is another key priority. This would enable companies and law firms to realize the return on investment in litigation and whether mutual agreement or arbitration might be a better alternative.
  • AI Law Office Management:
    1. Particularly for Law Firms, the concept of an AI assistant to gather standardized requirements from clients is a scalable idea. The rise of robo-advisers (or automated bots) advising HNI’s (high net worth individuals) and Ultra-HNI has shaken up the European wealth management industry, once considered conservative and old-fashioned.[7]
    2. Most administrative operations of law firms such as payroll management, resource management, meeting schedules and client billing are akin to those companies from other industries. The fact that 54% of manager time was spent in administrative / coordination and control tasks [8], is a huge motivation for management to invest in AI to automate such tasks.

AI’s contribution to Legal Services Industry: Boon or Bane?

My hope is that the use of NLP/AI would start from what is traditionally known as the “Bar” (the lawyers) and then extend itself to the “Bench” ( Hon’ble Judges) wherein even Judges could utilize the power of NLP Summarization to gather the sum of the contentions of both sides, the appellant (petitioner) and the defendant (respondent).

See Also

Besides spending less time on legal research and more time with clients, Lawyers and law firms could present arguments and offer evidence digitally, get it processed, validated and submitted faster. Judges could quickly deduce which part contains merit as per the Acts/Statutes and the latest case-law on the subject of law pertaining to the dispute. While AI/NLP would be tools, the discretion, experience and knowledge of the human mind would be essential in adjudicating disputes, so Judges would remain an integral part of the system.

The common misplaced notion that many legal industry executives, lawyers and law firms have is that Artificial Intelligence or Machine Learning is a threat to their existence, or put simply, that AI is going to replace Lawyers. The evidence, from other industries and verticals such as eCommerce, healthcare and accounting is that AI/ML will only enable Judges, lawyers and law firms to do more with less, to become way more productive than their predecessors.

Lawyers, law firm partners and associates would do well to view AI as a kind of super-smart colleague who is there to help them focus on higher-order tasks requiring creative skill and fine judgement while relegating the repetitive and standardized tasks to the AI-machine.

That said, a caution to be heeded:  the rapid pace of AI’s acceleration is faster than most legal professionals realize or fully comprehend.  Those lawyers, firms and professionals who assess the situation and plan for hiring and training the right skill-set of future lawyers and professionals will be much better prepared for the AI-age.


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