The Impact of AI on the Legal Industry
Artificial intelligence is a technology that has been rapidly developing in society, and its growing prominence has significant implications for the legal industry. This article will analyse some of the uses and challenges of AI and how it is shaping the future of the legal profession.
Current uses of AI in the legal industry:
Legal research
AI-powered platforms like Westlaw Edge and LexisNexis offer predictive search suggestions and advanced analytics, which saves lawyers valuable time on research tasks.
Contract review
Instead of manually reviewing each contract, corporate lawyers can use AI to quickly identify potential issues, such as non-standard clauses or missing provisions in shareholder agreements. This saves significant time and resources while reducing the risk of errors.
Case outcome prediction
AI is a very useful tool in litigation, as it can analyse previous case judgments and identify patterns to predict the outcomes of legal cases. Researchers at University College London, the University of Sheffield and the University of Pennsylvania applied an AI algorithm to the judicial decisions of 584 cases that went through the European Court of Human Rights and found patterns in the text. The algorithm was then able to predict the outcome of other cases with 79% accuracy. This tool plays a crucial role in the decision of filing a motion. Prior to AI, solicitors might spend hours manually reviewing court opinions, but now this can be done within seconds.
Client services
AI chatbots and virtual assistants are used to answer routine client inquiries and provide legal information. This allows lawyers to focus their time on higher-level work, such as building client relationships. It also improves access to justice as basic legal information is being made more accessible to more people.
Challenges:
Confidentiality and data privacy issues
The legal sector is bound by ethical standards and regulations that govern legal professional privilege, confidentiality, and professional responsibility. The ambiguity around how AI models store and handle data therefore raises key issues around data protection. When using ChatGPT, the information entered is sent to OpenAI’s servers, often through third-party services. The possible retention of personally identifiable or commercially sensitive data by third parties is a major concern.
Biases in AI algorithms
AI tools can provide inaccurate or fabricated information. There have been occasions where AI has provided information that appears factual but is entirely made up. A New York lawyer faced a court hearing after he used ChatGPT to research precedents for a case involving a man suing an airline over personal injury. Six of the seven cases he had used were found to be made up by AI. This highlights concerns about the reliability of using AI for legal research.
Implications for the legal industry:
Impact on legal jobs
AI is increasingly used to automate routine legal tasks, so the number of legal jobs may potentially decrease in the future. Despite this, AI cannot replace the expertise and critical judgement of human legal professionals, especially in aspects of work which require client interaction and courtroom advocacy. In the 2023 State of Practice survey conducted by Bloomberg Law, 72% of surveyed legal professionals said they ‘strongly disagree’ that gen AI will replace lawyers.
The challenges around AI, such as biases in its algorithms, may also increase the need for legal support and law firms may look to recruit more tech-minded candidates to monitor new AI systems. Therefore, even if some routine legal jobs may decrease due to AI, new jobs will be created due to this new technology.
Changing roles for lawyers
The use of AI will change the type of work lawyers undertake. In 2018, a study pitted AI against 20 top lawyers with decades of experience in reviewing NDAs. The AI system took 26 seconds to complete the review, whereas the lawyers took an average of over 92 minutes. On top of this, AI achieved a 94% accuracy rate while the lawyers averaged at 85%. AI may be used to reduce the more routine tasks lawyers carry out, such as document analysis and contract review, and allow them to focus on the more complex aspects of their job, such as strategic planning and building client relationships.
Overall, AI has had a transformative impact on the legal industry in terms of efficiency and access to justice, however there are still challenges that must be addressed to mitigate the risks associated with its use. The advancement of AI means that it is important for law students and practitioners alike to stay informed with the evolving legal landscape.
Written by Yinghan Ye.