Generative AI (GenAI) is transforming legal tech. This is particularly true for the last two years, as it has matured from a novel tool to a critical element in legal workflows and a key selling point for SaaS providers of legal services. From automating legal research to streamlining document drafting, AI is helping law firms and legal departments achieve efficiencies that were previously impossible — but this transformation comes with significant challenges that require training, management, and mitigations.
For those not familiar with legal tech as a vertical, legal tech refers to the use of technology and software to provide legal services, improve legal processes, and enhance the delivery of justice. Legal tech SaaS companies can be categorized based on their primary users: general or in-house counsel at the enterprise level, typically focusing on compliance management; law practitioners within firms and independent attorneys; consumers who seek to manage transactional law processes on their own; and the public sector, which includes courts, public defenders, prosecutors, probation offices, law enforcement, and jail management. Legal tech is inclusive of these companies — and the users they serve.
6 Ways Generative AI Is Changing Law
In legal tech, Generative AI is changing everything from business operations for law firms to automating transactional law to augmenting attorneys’ investigative and research abilities. Here are six use cases in the market today.
1. Automated Legal Research and Document Review
Generative AI is making legal research faster and more efficient by automating the process of sifting through extensive amounts of unstructured data ranging from text, video, emails, and audio. For instance, Thomson Reuters, a leading legal tech provider, has integrated AI into its Westlaw Edge platform. This tool uses AI to provide more precise search results, streamline document review, and offer predictive analytics, enabling lawyers to find relevant case law and legal precedents with greater speed and accuracy. DISCO offers eDiscovery solutions that leverage AI to automate document review, making it easier for legal teams to identify key documents and manage large-scale litigation efficiently.
2. Contract Management and Analysis
The first wave of web-based contract management platforms rose in the early 2000s, but contract management is a persistent need where generative AI is advancing the toolset. DocuSign uses AI to make the whole contract process easier, from drafting to compliance checks, with tools like DocuSign Insight that quickly scan contracts for risky clauses and ensure everything’s in order. Evisort, another contract management platform, focuses more on what happens before and after a contract is signed — to promote outcomes like deal acceleration. Its AI automatically pulls out key details like renewal dates and obligations, giving businesses a clearer view of their agreements and helping them stay on top of compliance.
Some larger law firms are preferring to “roll their own” AI tools for contract generation, such as A&O Shearman creating ContractMatrix. Some firms may benefit from centering models on in-house data, or from having more control over emergent techniques such as RAG (Retrieval Augmented Generation), which allows you to train an AI to look at specific data sets when performing certain queries.
3. Litigation Prediction and Strategy Development
Generative AI is helping analyze historical case data to predict litigation outcomes — and helping law firms develop more effective strategies. A part of LexisNexis, Lex Machina focuses on legal analytics by providing data-driven insights on litigation trends, including the behavior of judges, courts, and opposing counsel. It is widely used by law firms for building case strategies based on past decisions and predicting case outcomes.
4. Virtual Legal Assistance and Document Fulfillment
Beyond the ubiquitous chatbot, generative AI is enhancing legal services through automated communication and virtual assistance. LegalZoom, a direct-to-consumer legal service provider, uses AI to help clients with document preparation and legal advice, making legal services more accessible and affordable. AI algorithms provide a starting point for functional documents such as wills and business registration. Their Doc Assist service allows a layperson (non-attorney) to quickly interpret complex legal documents and isolate key facts, clauses that may require attention, and common questions to ask the issuer.
5. Courtroom and Emotional Response Simulation
JuryLab leverages generative AI to assist legal professionals with trial planning by simulating jury decision-making. The platform allows attorneys to present case facts and arguments to virtual mock jurors, who provide feedback on their likelihood of voting for or against a verdict. By analyzing patterns in jury responses, the AI model helps lawyers refine their strategies before heading to court. This innovative use of generative AI enhances trial preparation by offering insights into how different types of jurors may react to evidence.
6. Practice Management, Business and Legal Operations
Several SaaS companies are leveraging AI to help law firms optimize their business operations and budgeting processes. Clio offers AI-driven insights into business performance metrics, helping law firms track billing, revenue, and client engagement more effectively. Another example is Litify, which provides an all-in-one platform with AI tools for case management, client relationship management (CRM), and financial analytics. Litify's AI capabilities enable law firms to forecast revenue, manage expenses, and optimize resource allocation based on historical data and predictive modeling.
4 Emergent GenAI Trends in Legal Tech
In addition to the various ways GenAI is changing law services and legal, there are a number of trends emerging that will further meet the needs of companies and customers, and the potential for software’s impact on the industry. Here are four emergent trends.
1. Tailoring for Court-Specific Outputs
Thomson Reuters’ CoCounsel, which was developed in collaboration with OpenAI, focuses on providing more advanced legal research capabilities through generative AI. CoCounsel aims to draft legal arguments and briefs by analyzing the context of ongoing litigation and crafting responses tailored to specific legal questions. It goes beyond simple search-and-summarize functions, generating nuanced, case-specific legal arguments. This is an example of where generative AI is not just summing up information or suggesting clauses but actually drafting legal arguments or specific outputs for court filings.
2. Anticipating Human Reactions to Documents
Spellbook offers a generative AI tool that assists in contract negotiation by drafting responses and suggesting edits directly within a negotiation process. It helps lawyers anticipate counter-arguments and suggests changes to improve or defend specific clauses — or make language less aggressive. Spellbook’s offering tailors to active human negotiation, which isn’t just language generation but (at least in theory) helping attorneys better understand sticking points in contracts — before the document goes into the other party’s hands.
3. Replacing or Enhancing the Role of Paralegals
Harvey.ai provides a GenAI tool tailored for internal legal use, primarily focused on producing highly tailored legal memos. It takes complex questions about case law or regulatory issues and generates comprehensive, domain-specific memos with some understanding of jurisdictional variations. This specialization produces detailed, customized legal analyses, much like an AI-powered paralegal.
4. Specialized and Niche Domain Expertise in Areas Like Tax Law or M&A
Ailira initially started as a general legal research tool but more recently developed capabilities for providing detailed guidance on tax law, particularly in the Australian market. It interprets complex tax regulations, generates personalized tax advice, and assists in drafting tax-related legal documents for individuals and businesses.
Ailira's focus on the intricacies of tax law — within Australia — sets it apart from broader research tools. It is one of the few generative AI systems that dives deep into a specialized area of law, offering interactive advice and document generation based on intricate, niche regulations such as tax compliance.
Kira Systems has introduced generative AI capabilities specifically for the due diligence process in mergers and acquisitions (M&A). Their tool analyzes thousands of documents and generates detailed summaries of risk factors, key contractual terms, and compliance requirements. The generative AI drafts custom due diligence reports tailored to the unique needs of a specific transaction, providing lawyers with a head start in understanding potential red flags. Although many tools exist for document review, Kira Systems' generative AI focuses on offering a deeper, contextual understanding of intricate M&A documents.
Conclusion
Generative AI has rapidly become a transformative force within legal tech, revolutionizing how law firms and legal departments handle everything from research to client interactions. The ability to automate complex tasks and provide predictive insights is enabling greater efficiency and accuracy in legal workflows. There are many promising new players in the generative AI space, adding and deepening utility and specializations.
Generative AI is not the only trend driving shifts in how attorneys practice or how legal services are offered — advances in data analytics, cloud-based practice management platforms, and document fulfillment/automation are also playing pivotal roles. As these technologies continue to evolve, the future of legal services will be defined by a blend of these tools, creating new opportunities and challenges for the legal industry.
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