The Future is Now: Innovations in the Legal Industry

By Pablo Fuchs June 30, 201730 June 2017

The Future is Now: Innovations in the Legal Industry

As organizations demand more from their legal teams, in-house counsel can look to innovative technologies to help them become more productive. Many of these tools focus on removing menial, time-consuming work so counsel can focus on higher-value judgment tasks and spend resources more effectively.

Here is a closer look at some up-and-coming Canadian companies that offer unique, productivity enhancing tools for in-house counsel.

Codify Legal Publishing

Codify offers two products to lawyers: Codify Updates and Codify Automation. The former is a tool that tracks changes to legislation while the latter is a contract automation tool.

Those who use Codify Updates can create a personal watch list of certain laws, and once there’s a change to a key piece of legislation in any jurisdiction in Canada, the user receives an email explaining the changes. Further, users can log in to a dashboard that shows a side-by-side comparison between the old law and the new law, with details on what has changed.

Codify Automation is different than what competitors offer, according to Paolo Tonelli, Codify Legal Publishing’s CEO and Founder, because the company doesn’t just hand over a tool for clients to program themselves; rather, the firm designs the contract and does the programming. This can range from simple non-disclosure or vendor agreements to more complex contracts with hundreds of variables.

While Codify currently offers the tools as separate products, it does have plans to integrate them.

Both tools rely on automation, a technology Tonelli describes as “tried, tested and true.” Automation involves the standardization of very complex processes and “is a safe and reliable method of handling enormous volumes of data.”

The aim of these tools is to free up lawyers’ time so they can spend it on more meaningful work. As Tonelli explains, “For in-house counsel, it’s a huge win to spend their time analyzing the changes, rather than tracking them.”

Diligen Software

Diligen has developed machine-learning software for reviewing legal contracts. The user uploads contracts into the software and the algorithm quickly produces insights into those contracts.

Using machine learning compared with some of the older methods means “a big increase in accuracy,” says Laura Van Wyngaarden, Diligen’s COO, because of the machine’s ability to identify certain clauses. “It also gets better and better and smarter and smarter. So, for users, the software produces better contract reviews over time.”

Diligen is constantly working on improving the algorithm and making it more accurate. The standard version of the software looks for and finds the key clauses in the contract, but the firm is also focusing on allowing users to train the algorithm to search for specific clauses outside of standard contract review—which is a huge value-add for in-house legal teams looking for specific elements in the contracts they’re reviewing, she notes.

The software also has a project management component that helps legal teams review documents together. So, if in-house counsel have a high level of contracts and a sizeable legal team, they can assign documents for team members to review, keep track of who has done what and when, and read team members’ comments.

The main benefit of using this software “for corporate counsel is all about knowing what’s in your contracts really, really fast,” Van Wyngaarden says. “The tool expands the team’s contract review capacity, gets deeper insights and identifies the critical elements that are in your contracts, which can be very helpful when dealing with many contracts and/or smaller teams. It also reduces the reliance on outside counsel.”

Blue J Legal

This company also relies on machine-learning algorithms but leverages this technology to produce high-quality predictions about what courts would say in specific situations. Its first product, Tax Foresight, has made accurate predictions on tax-related matters more than 90% of the time, says Benjamin Alarie, Blue J Legal’s CEO.

What allows the tool to be so accurate is that it collects a rich description of the facts by asking users 20-30 questions about their particular situations; the algorithms then base the analysis on a sophisticated understanding of those facts and compare them against every single case.

This tool has various benefits for in-house counsel, says Alarie. For example, the software provides an independent, data-driven analysis so they can verify if their perception of a case is accurate. In addition, it provides an explanation why courts would rule a certain way and identifies cases that are similar or that may be obscure but provide similar facts.

For example, Tax Foresight and a new tool that focuses on employment law, Employment Foresight, have a worker classifier component that lets in-house counsel know whether a worker is an employee or an independent contractor. So, if the Canada Revenue Agency comes asking, counsel doesn’t have to spend the resources to figure this out.

Employment Foresight will be available toward the end of the year. It will predict the amount of reasonable notice a court would give when an employee is being dismissed without cause or whether someone is being wrongfully dismissed.

“We’re now moving into computational world of legal research in which algorithms are helping lawyers figure stuff out. We see a lot of promise in [this technology],” Alarie says. “There are no limits. Wherever there are contentious legal issues, corporate counsel will use artificial intelligence (AI) and other related tools to get better predictions.”

BidSettle

This start-up’s name comes from its first product, an online negotiation platform through which bids are made to reach a settlement. Citizens or businesses go online, make monetary offers and counteroffers, and when the offers overlap, the website automatically generates a binding out-of-court settlement.

The process is based on blind bidding, although the company is working on the second generation that will allow for visible monetary offers, says Philippe Lacoursière, Lawyer and Co-Founder. Although it’s targeted mostly at citizens who don’t have access to the legal justice system, there are various reasons why in-house counsel should consider this tool.

“Companies typically let go of smaller amounts owed to them because they’re not as important,” he explains. “We provide them a user-friendly platform to go and get that money—whether it’s the online negotiation platform, which has a really user-friendly dashboard with all the information, or custom-made solutions for businesses that white-label our products on their websites.”

The white-label platform allows a company to send out mass claims outstanding, which is much faster than having a person send individual emails. After that, the company just waits. If nothing happens, it doesn’t cost the company anything, as the model is based on paying BidSettle 2.5% of the final amount of the settlement. The other advantage is that the tool puts emotions aside, Lacoursière adds, which is beneficial for good negotiations.

The Pitch

The CBA Legal Futures Initiative’s inaugural event to showcase entrepreneurs in early-stage legal technology start-ups was so successful, it’s making a comeback in 2018.

“The Pitch,” which was held at the CBA’s annual legal conference in Ottawa last year, will be a part of the CCCA National Conference and ICW Summit in Toronto in 2018.

The first event saw five start-ups compete for a two-week residency with LegalX at MaRS Discovery District in Toronto. In addition, these five finalists, chosen from a group of 35 applicants, were guaranteed an interview with the Chinese Angels Mentor Program. Those selected would receive an equity investment of no less than $200,000 (pending due diligence).

Beagle Inc. was chosen as the first place winner by the judges’ panel, while Loom Analytics won the people’s choice award.

“The feedback we received was very positive,” says Fred Headon, Past President of the CBA and Chair of the Legal Futures Initiative. “For many, it was the first time seeing the power of what technology could do for law. And the entrepreneurs themselves appreciated it because of the exposure they received. The participants have gone on to further refine their products and get more opportunities as more people have become aware of them, and we’re happy to have been a part of that.”

Anyone interested in the 2018 event should keep an eye on the CBA’s website: http://www.cba.org/The-Pitch/Home. Last time, the prerequisites were firms that were up and coming and had technology related to the legal space, with less than $120,000 in annual revenue. Those parameters will likely be similar for 2018.

Pablo Fuchs is a writer based in Toronto. This article was first published in the Summer 2017 issue of CCCA Magazine.

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