Update: LegalMation’s New Approach to Legal Analytics

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By Richard Lau, Manager, Production

As the pandemic progresses, commentators are still trying to figure out what the new normal will look like for the global economy. However, the uncertainty created by the global COVID-19 pandemic has only intensified a decade long trend in the legal industry of more clients becoming more critical of conventional wisdom and more skeptical of the value being provided by legal services.  We have already seen this dynamic appear in staffing: clients are no longer willing to pay the same rate per billable hour for work performed by associates as they do with work performed by partners. But even among attorneys of similar seniority and experience, each hour worked is not necessarily as productive as any other. How can we valuate the time attorneys spend on given tasks? At the same time, law firms must select which clients to represent and which cases to take. The intensifying pressure to generate value means that firms must also become more discerning about which cases they take. Taking a financial loser of a case can be  devastating.

The emerging  answer appears to be legal analytics. For the past 10 years, the legal industry has been moving to a more data-driven approach to decision making to reduce waste and provide greater value, and now in the midst of the COVID pandemic, this increased efficiency will not be just another selling point for a given law firm, but a matter of that firm’s survival.

The Old Paradigm

Discussion of big concepts like analytics in the abstract can be disorienting, and lead to those important ideas being perceived as buzzwords. The easiest way to see the value of the legal analytics is to examine the systems and procedures they are replacing and their weaknesses.

In the past, staffing and trial strategy decisions were made primarily based on an experience. The supervising attorney in charge of a case would rely on their informed intuition to decide which members of his team to assign to a given task and how much overall time to spend on a given task.  In this way, a competent supervising attorney will usually create a strong and effective overall strategy but is not very useful when trying to justify your prices on an itemized bill. Moreover, this approach will result in unnecessary and potentially wasteful tasks being codified along with the valuable tasks. This is simply human nature: when people experience success they want to do things the exact same way in the future, and without a clear picture of how each individual step contributes to the success of the overall endeavor, why would they compromise a proven strategy by changing it? Personnel decisions were made in a similar way, people being given tasks based on their perceived or general expertise. Over the past few decades, the industry has been moving to a more objective, quantitative means of measuring value, through standardizing task and pricing data in (UTMS and LEDES respectively) so that we can more effectively make comparative evaluations. But these categories must be manually assigned, often by attorneys unfamiliar with the system or uninvested in tasks that do not directly pertain to winning the current case.  

On the case valuation front, firms typically task an attorney to read the complaint and looking for three to five previous cases with similar facts, or at least the same general topic. The attorney will then look at the billing data and make an estimate regarding the revenue and cost of handling the current case based on those previous cases. The process resembles searching for precedential decisions in litigation: the attorney reads the complaint and makes a judgment call about whether its “on-point” enough. With three to five complaints, there is simply not enough data to perform a more granular comparison of specific facts (e.g. evaluating the impact of the plaintiff’s age in an age discrimination case, in isolation of the other case facts). However, reading more than three to five similar complaints per complaint is not cost effective: the information gained is not worth the time spent. This is especially true when using these comparisons to determine which cases to take, since these assessments would need to be performed on cases the firm turns down as well.

The New LegalMation Paradigm

The biggest obstacle to any analytics solution is often obtaining the data. Law firms and inside counsel often have a resistance to analytics because they believe that any solution would necessarily involve the tedious and time-consuming task of labeling all their unstructured data. However, large amounts of unstructured data are no longer the obstacle it once was.  Advances in natural language processing allow AI platforms like ours at LegalMation to analyze work product to automatically determine the type of work performed and which litigation phase in which it belongs. Firms no longer must rely on the subjective and sometimes incomplete manual identification of these phases, consistency when comparing the work of multiple attorneys. Instead of having an attorney read complaints and look for similar complaints, we have an AI platform that analyzes the complaint and identifies the actual facts of the case (such as the specific medical condition in a discrimination case). Such an approach has the advantage of being both more granular and being capable of considering far more than just three to five complaints at once.

From there it becomes a relatively simply matter of incorporating the billing information from the law firm’s existing enterprise legal management software (which already stores this billing data in a semi-structured format).

Here are a few examples of the actionable insights our platform can derive:

Conventional WisdomWhat the Data Actually Shows:
Discovery does not directly require an attorney’s expertise (applying law to fact) and thus should be assigned to associates and paralegals.Senior attorney involvement in the discovery phase tended to have better outcomes, suggesting that their involvement and legal expertise make an impact here.
In an age discrimination case, the older the plaintiff, the better the cases odds of success.Age discrimination cases where the plaintiff is between 50-55 actually have the greatest odds of success.
Opposing counsel and jurisdiction make a differenceThis is true, but now we know specifically how and how much (e.g. being able to differentiate between a jurisdiction that is slightly more favorable and a jurisdiction that is much more favorable).
An employment attorney with the best success rate is the best person to handle any employment case.An employment attorney may excel at specific subjects (e.g. age discrimination vs racial discrimination) or specific tasks (e.g. talented at discovery vs talented at motion practice) and is thus more valuable on some employment cases than others.

Our platform derives these insights using a specific firm’s data, so our client knows that these insights pertain specifically to them.

                Moreover, our system can look at all your data at once and generate customizable visualizations. In the time-intensive old paradigm, analysis typically required a specific hypothesis to test. However, this new unified approach allows clients to conduct open-ended exploratory analysis looking at multiple variables at once. This could potentially reveal relationships that it would not even have occurred to us otherwise.

Conclusion

LegalMation’s data analytics solution replaces the slow, discrete, intuition-driven tasks described in the previous section with a single unified platform that is fast, holistic, and data-driven. Where other legal analytics solutions focus on external, public data to provide mono-variate insights regarding case facts and law, the Legalmation Data Analytics leverages a firm’s internal data as well, to create a more complete picture of how internal decisions about procedures and staffing impact outcomes. This platform reveals how both datasets interact: How the value added by legal spend in various litigation phases would vary according the facts of the case.

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Platform Overview

LegalMation provides a suite of Artificial Intelligence tools to help litigation attorneys and legal professionals practice at their highest levels. Our litigation automation solutions tackle routine litigation tasks. Unlike existing template generators and form-fillers, LegalMation's ground-breaking AI system is able to dynamically produce responsive pleadings, discovery requests, discovery responses, and related documents that are tailored to the claims, allegations, and requests in the legal document uploaded, incorporating jurisdictional requirements as well as the attorney’s own style, formatting, and response strategy.

Our litigation analytics solution uncovers deep insights into our customers' own data (the data sitting underneath the surface), drilled down to granular data points, previously not possible. The impact? Our solution fundamentally transforms how cases are assigned, budgeted, settled, pitched, and much much more.

Developed by a passionate group of award-winning litigators and highly accomplished software developers, LegalMation is focused on liberating litigators to allow them to focus on more valuable tasks in their practice.

LegalMation distinguishes itself from other Artificial Intelligence products in several key aspects.:

  • LegalMation is the first Artificial Intelligence company to focus solely on using AI to automate and enhance litigation tasks.
  • LegalMation uses cutting-edge AI to power its platform and, unlike some other legal tech platforms, LegalMation requires no human involvement to generate its output.
  • LegalMation's automation solution is not a template generator, form-filler, or other Q&A-driven tool. Rather, our A.I. solutions generate actual work product--caliber drafts of legal documents comparable to that of an attorney or legal professional that only require minor editing and basic review before filing/serving. Drafting these documents from scratch often takes an associate attorney or paralegal an entire day, but our products can produce comparable high-quality drafts in mere minutes.
  • LegalMation's analytics solution, takes an entirely different approach to data analytics. Our proprietary solution ingests a company or law firm's own existing data (billing, case results, etc.) and provides deep insights down to granular levels previously not possible. Unlike publicly available statistics, we believe our customer's own data provides truly actionable insights. After all, less than 5% of case results are publicly available.
  • LegalMation’s solutions are fully customizable to our customers' needs.
  • LegalMation’s solutions are easy to use and require no computer knowledge besides how to use a mouse and keyboard. Our products are browser-based; there is nothing to download or install. The interface is simple and clean, and designed to be accessible to even the least tech-savvy. As a result, the adoption cost for integrating LegalMation to an existing organization's workflow is very, very low.

Corporate In-House Case Study

A leading global retail giant achieves significant savings on legal fees on its high-volume litigation matters using LegalMation’s Complaint Analysis tool.

The Legal Operations group of a leading global retailer with significant litigation volume across the country was searching for technology tools to increase efficiency and consistency on its litigation matters, lower its legal spend, and obtain more value from outside counsel. Working with LegalMation, the retailer identified two litigation areas with large volume where the deployment of LegalMation’s Complaint Analysis tool could have a significant impact: employment and premises liability tort litigation.

The retailer conducted a pilot of LegalMation’s Complaint Analysis tool by asking select outside counsel to run complaints through the LegalMation Complaint Analysis tool and compare the outputs to those generated by the firm’s typical workflow.  LegalMation’s Complaint Analysis tool was able to generate an answer, requests for production and interrogatories that were almost identical to those generated by outside counsel and tailored to the facts and allegations of each.

Today, this global retailer has made LegalMation an integral part of its workflow and case assignment process. When a new lawsuit is served on the retailer in one of the jurisdictions where LegalMation operates, an in-house paralegal runs the complaint through LegalMation’s Complaint Analysis tool and sends the output, consisting of an answer, requests for production, interrogatories, and other jurisdiction or firm-specific output to the selected outside counsel for the matter.  Outside counsel then bills the retailer solely for the time spent reviewing and editing this initial output which generates significant savings for the global retailer.

Challenge

  • Increasing budgetary pressure to lower outside counsel legal fees
  • Obtain more value from hours billed by outside counsel
  • Lack of consistency in work product and quality from outside counsel

Solution

  • Deploy LegalMation internally to generate initial draft responsive documents in minutes
  • Integrate LegalMation into its initial case assignment process

Results

  • Up to 80% savings on outside counsel legal fees on key early stage litigation document drafting.
  • Reallocation of outside counsel time away from process/routine work to higher value strategic tasks.
  • Increased consistency and quality in work product

Large Firm Case Study

An Am Law 100 labor and employment law firm was searching for ways to become more competitive and capture more market share

Handling over 5,000 employment related litigation matters per year across the country, the Am Law 100 law firm (the “Firm”) needed a quantifiable solution to lower its servicing costs and provide more value to its national clients. The Firm engaged in extensive testing of LegalMation’s platform across multiple offices to determine its effectiveness.

Using LegalMation’s Complaint Analysis tool, the Firm was able to reduce the attorney time spent preparing answers, affirmative defenses, and initial written discovery (requests for production, interrogatories, and other jurisdiction-specific requests) from an average of 6-8 hours per matter, to less than 1 hour (including review time by an attorney). The Firm tested LegalMation’s tools across multiple types of employment cases across various jurisdictions and concluded that the resulting draft documents were not only produced incredibly fast, but were also consistent in quality.

Today, the Firm is able to offer more competitive proposals for its volume matters, which in turn allows it to obtain additional work from national clients.

Challenge

  • Downward price pressure in high-volume, lower-exposure matters
  • Making Alternative Fee Arrangements more competitive and yet more profitable
  • Differentiate from competitors during marketing pitches
  • Lack of work product consistency from associates/paralegals

Solution

  • Integrate LegalMation into volume litigation matters in the Firm’s busiest offices

Results

  • Up to 80% time savings on key litigation tasks
  • Higher profit margins on volume matters, particularly those on AFAs
  • More distinctive marketing
  • Higher levels of associate satisfaction

SMALL LAW Firm Case Study

A high-caliber general litigation boutique reduced paralegal and associate time and money expended on key early litigation tasks by 75%+

A general litigation boutique with around 40 attorneys needed to cut costs in order to stay competitive in a very crowded local market and also sought to minimize reliance on support staff.

Using LegalMation’s platform, the boutique law firm was able to reduce the attorney (and paralegal) time spent preparing answers, initial discovery (requests for production and interrogatories), and discovery responses, including objections, from several hours per matter, to less than 1 hour (including review time by a supervising attorney). The boutique firm tested LegalMation’s Complaint Analysis tool and Discovery Analysis tool across multiple practice areas and concluded that the resulting draft documents were not only produced incredibly fast but also with consistency and quality similar to its own junior attorneys and paralegals. In particular, the boutique law frim, which did not have the luxury of a large support staff, found LegalMation’s Discovery Request tool particularly helpful in dealing with burdensome discovery requests served on its clients.

Today, the boutique law firm is able to offer more competitive proposals for its matters and through the efficiency gained by LegalMation’s platform compete against national law firms with more resources.

Challenge

  • Downward price pressure due to a crowded local market
  • Limited associate/paralegal resources to handle routine drafting tasks
  • Compete against national law firms with more resources
  • Differentiate from competitors during marketing pitches
  • Lack of work product consistency from associates/paralegals

Solution

  • Deploy LegalMation’s Complaint Analysis tool to generate initial draft responsive pleadings, and the Discovery Analysis tool to quickly generate shells and responsive objections throughout the life of a case

Results

  • 70-85% time savings on key litigation tasks
  • Higher profit margins on volume matters, particularly those on AFAs
  • More distinctive marketing
  • Higher levels of associate satisfaction
  • Reduced staff overtime
 

Success Story

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John Smith,
Company Name
James M. Lee
Co-Founder & CEO

James M. Lee is co-founder and CEO of LegalMation. He is a founding partner of LTL Attorneys LLP, a nationally recognized litigation boutique. As an experienced litigator, he has tried numerous cases in federal and state courts. He has been recognized as a top business litigator by various legal publications including the National Law Journal. James has served as lead counsel to a number of Fortune and multinational clients including Wal-Mart, Thomson Reuters, Symantec, and VIZIO. He was formerly associated with litigation powerhouse Quinn Emanuel before co-founding LTL Attorneys. He is a frequent and noted speaker and commentator in the field of AI and innovations in the field of law. He received his J.D. from Stanford Law School, and his B.S. from the University of Southern California. At LegalMation, James serves as the key driver of the Company’s vision and strategy.

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Insurance COMPANY Case Study

A national insurance carrier achieves significant savings on its high-volume, low exposure litigation matters through its adoption of LegalMation’s Complaint Analysis tool

A national insurance carrier with significant litigation volume across the country for its insureds, was searching for technology, tools, and processes to increase efficiency on its litigation matters to lower its litigation costs. This national insurance carrier partnered with LegalMation to identify an area of litigation where LegalMation could have a significant and immediate impact and decided to deploy LegalMation’s Complaint Analysis tool for all of its third-party motor vehicle tort litigation.

LegalMation worked closely with the national insurance carrier to customize the output from its platform to generate documents that mirrored the current output of the national insurance carrier’s attorneys and paralegals.  LegalMation was able to automate the creation of an answer, requests for production of documents, interrogatories, requests for admissions, and deposition notices, all tailored to the facts and allegations of each complaint and almost indistinguishable from those manually created by the insurance company’s attorneys and paralegals.  LegalMation was able to generate this output in 2-3 minutes—a significant time savings over the insurance company’s prior practice for generating this output.

Following a pilot program consisting of processing all of its complaints for a single jurisdiction through LegalMation, the national insurance company made LegalMation an integral part of its workflow for all jurisdictions where LegalMation currently operates. In these jurisdictions, when a new motor vehicle-related lawsuit is served on the insurance company or its insureds, the assigned counsel or paralegal runs the complaint through the LegalMation Complaint Analysis tool, downloads the initial outputs, which are then reviewed by the attorney or paralegal and finalized, all within a few minutes.

Challenge

  • Increasing budgetary pressure to lower legal spend on defense of insureds
  • Obtain more value from staff counsel
  • Reduce legal secretary/paralegal overtime

Solution

  • Deploy LegalMation internally so staff/captive counsel can generate initial response draft documents in minutes

Results

  • Up to 80% time savings on key litigation tasks
  • Reallocation of staff/captive counsel time away from process/volume work to higher value strategic tasks
  • Increased consistency and quality in work product

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