Final week, a authorized tech firm Lawhive reportedly bought a UK legislation agency lock, inventory, and barrel. In response to a story concerning the acquisition, the legislation agency, Woodstock, specializes in property legislation. (In contrast to within the US, UK rules allow non-lawyer entities to personal legislation corporations.) This seems to be the primary or not less than one of many first examples of a authorized tech firm shopping for a legislation agency.
The Lawhive Acquisition
The story describes Lawhive as an AI-powered legislation agency. It additional notes that its AI assistant, Lawrence, is designed to deal with varied duties together with drafting paperwork, conducting analysis, and managing instances. Lawhive operates in varied follow areas together with property. Google is a important investor in Lawhive in accordance with the story. Lawhive additionally operates within the US.
Amongst different issues, Lawhive guarantees to get quotes for authorized service for its shoppers at as much as half the price of normal legislation corporations. And usually for a flat charge.
The Significance and Considerations
The indisputable fact that an AI-based authorized tech vendor owns and controls a legislation agency might have a major influence. Such a vendor would have clear incentive to cut back prices and enhance earnings by using its AI instruments to do a lot of the work traditionally performed by attorneys. It might thereby cut back workers to recoup its funding.The providers historically carried out by the attorneys and authorized professionals in such a legislation agency would now be performed by AI, changing people as the first supplier of the authorized service provided.
I questioned in such a case whether or not and the way the work being performed by such an acquired legislation agency sooner or later can be clear to its shoppers. Would shoppers know that AI, not human authorized professionals, was dealing with the vast majority of their work? Ought to shoppers be told concerning the vendor’s possession of their legislation agency?
As well as, because the vendor’s AI instruments turn out to be extra sophisticatedand do extra, would correct precautions be taken to protect towards hallucinations and inaccuracies that bedevil all GenAI instruments? Distributors sometimes stretch the capabilities of their instruments and downplay the hallucination and inaccuracy points. In the event that they “drink their very own Kool-Support,” would they be tempted to not require the required human checks and sufficiently workers the legislation agency to do this? Would that hasten the demise of the proverbial lawyer within the loop? Is the longer term legislation corporations that produce numerous work however have only a few if any attorneys? Does this vendor acquisition predict the longer term?
Enter Jordan Furlong
I used to be reminded of all this earlier this week after I learn Jordan Furlong’s glorious piece entitled The Divergence of Law Companies From Attorneys. Furlong is without doubt one of the most astute observers of the authorized and authorized tech scene. He’s additionally a rattling good futurist. Furlong believes that the connection between attorneys and legislation corporations goes to be considerably weakened by AI.
Furlong observes that with AI, “Legislation corporations will turn out to be able to producing output that may be offered to shoppers with no lawyer involvement in any respect.” In different phrases, lots of the providers performed by legislation corporations shall be performed by AI, not authorized professionals and personnel. He notes that a lot of that for which odd folks use legislation corporations — authorized evaluation, authorized doc preparation, and the authorized service supply — can already be performed by AI. For higher and principally worse, not less than proper now.
Furlong additionally appropriately notes that an LLM can already carry out authorized duties that may be straight offered to a consumer. Furlong says this locations the LLM as the first performer of the authorized job which is one thing totally new. By utilizing LLMs, legislation corporations might sooner or later promote authorized providers to shoppers with none involvement of attorneys in any respect. Furlong goes on to notice that legislation corporations could be compelled to do that by consumer and price pressures.
Importantly, Furlong notes that having AI endeavor authorized duties right now requires a lawyer within the loop to make sure accuracy and fulfill moral necessities. “However as Generative AI will get higher at performing authorized duties, that oversight will turn out to be extra perfunctory, and previous a sure level, it is going to taper off altogether.”
After all, it will basically reshape how authorized providers are offered and thru what automobile. Furlong muses that legislation corporations could even turn out to be extinct, changed by an internet hub. Furlong thinks that what might occur is that future attorneys would nonetheless be helpful to solely present providers like advising, advocating, strategizing, and the like. They only received’t want legislation corporations to supply them.
The Lawhive Acquisition: An Augur for the Future
Furlong’s predictions aren’t simply theoretical now. On condition that authorized tech distributors are the first supplier of AI providers to legislation corporations, it’s not unreasonable to assume that there might very effectively be extra acquisitions just like the Lawhive one. The distributors would possibly actually understand that as an alternative of promoting the AI to the legislation corporations, who in flip use it to promote its providers to shoppers, the seller might simply purchase the legislation agency, use it as a automobile to promote the service, and take for themselves the earnings from the providers.
Certainly, lots of the issues Furlong suggests in his article might come to move because of the Lawhive and comparable acquisitions of legislation corporations. With these sorts of acquisitions, you would have a vendor with refined instruments having the aptitude of controlling how and what work is finished by AI and what’s performed by people. The buying firm would have the functionality to supply the identical sorts of authorized providers now performed by people via its AI. It might have the functionality via the legislation agency, to supply and promote authorized providers performed by AI.
Certainly, it affords the chance that the providers of the legislation agency can be primarily performed by AI, simply as Furlong predicts. And as the AI turn out to be extra refined, the lawyer within the loop wouldn’t lengthy be wanted, decreasing the necessity for nearly any lawyer in that legislation agency. Such acquisitions provide the chance that the legislation agency would turn out to be that on-line hub that Furlong envisions. It’s even foreseeable that the distributors might provide the AI provided providers themselves.
We Shall See
We’ve got no manner of understanding how the Lawhive acquisition will unfold, however it could be the primary domino to fall in a a lot bigger transformation. This type of acquisition might create precisely the situation Furlong envisions which is why Lawhive shopping for Woodstock feels so important and probably predictive of the longer term.
Stephen Embry is a lawyer, speaker, blogger, and author. He publishes TechLaw Crossroads, a weblog dedicated to the examination of the stress between expertise, the legislation, and the follow of legislation.
