(Sep 23) What happened in LegalTech last week?
Legal tech advances with UK law firms exposed to cybersecurity risks, new CA digital rights laws, and global expansions by AI startups like Harvey and CRM vendor Nexl.
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Key Stories
This week in legal technology, we observed significant movements in the AI and cybersecurity landscapes. The consolidation of early legal AI pioneers continues to shape the future of the sector, paving the way for generative AI startups to emerge and innovate further. Meanwhile, a pressing cybersecurity issue has been highlighted in the UK, with a staggering 72.2% of law firms having compromised employee passwords on the dark web. This underscores an urgent need for robust cybersecurity measures. In the US, California passed two groundbreaking laws, AB 1836 and AB 2602, aimed at regulating digital replicas, thus ensuring consent and control in virtual uses of deceased personalities and artists' likenesses.
The End of the Legal AI Pioneers + A New Beginning
Generative AI startups are emerging, leveraging the groundwork laid by earlier innovators. This marks a continuation of the cycle of innovation and acquisition in legal tech. (The End of the Legal AI Pioneers + A New Beginning (Artificial Lawyer))
New UK law firm cyber research finds over one million passwords on the dark web
Research by Atlas Cloud reveals substantial cybersecurity vulnerabilities, with 72.2% of UK law firms having employee passwords exposed on the dark web. The study calls for immediate action to implement essential cybersecurity measures. (New UK law firm cyber research finds over one million passwords on the dark web (Legal IT Insider))
California and artificial intelligence laws
California has enacted AB 1836 and AB 2602 to regulate digital replicas, ensuring that the use of deceased personalities' likenesses and artists' digital replicas require consent and control respectively. (California and artificial intelligence laws (Inside Tech Law))
All Other Stories
A significant wave of expansions, acquisitions, and innovations pervades the broader realm of legal tech. California-based legal AI startup Harvey is expanding to London, reinforcing the city's reputation as a burgeoning AI hub ("Harvey to launch in London – and is hiring (Legal IT Insider)"). Australian CRM vendor Nexl’s strategic acquisition of Databall is set to enhance its data aggregation capabilities, promising better client insights for law firms ("Exclusive: CRM vendor Nexl to acquire revenue operations startup Databall (Legal IT Insider)"). Concurrently, law firms like Kennedys prioritize roles in technology by appointing a new CIO and its first-ever Chief Knowledge Officer to drive innovation ("Kennedys appoints new CIO and first-ever CKO (Legal IT Insider)").
We also saw various technology launches, like Zuva Analyze for contract reviews ("Kira Spin-off Zuva Unveils New Contract Review AI For In-house Legal Teams, Zuva Analyze (LawSites)") and Consilio’s Guided AI Review blending human expertise with AI ("Consilio Unveils Guided AI Review, An Expert-Guided Document Review Solution (Legal Technology News - Legal IT Professionals | Everything legal technology)"). Expansions by companies like Proteus Discovery Group and Workday’s acquisition of Evisort further emphasize strategic growth through enhanced service capabilities ("HR Company Workday Buys CLM Evisort (Artificial Lawyer)"). Overall, this week's developments highlight a legal industry in flux, driven by technological advancements, cyber vulnerabilities, legislative changes, and strategic maneuvers to optimize data management and operational efficiency.
Links and summaries
Want to explore a story more deeply? Here are the original links to the stories, with summaries to aid review.
Key stories
The End of the Legal AI Pioneers + A New Beginning (Artificial Lawyer)
The acquisition of Evisort by Workday marks another chapter in the ongoing consolidation of the legal tech sector. Over the past decade, pioneers like RAVN, Kira Systems, and Seal Software demonstrated the potential of AI in transforming legal operations, primarily through machine learning (ML) and natural language processing (NLP). Most of these innovators were eventually acquired by larger firms, reflecting the broader industry's maturation and integration of AI tools. With the ascent of generative AI (genAI), a new wave of startups is emerging, likely to face similar market dynamics. This cyclical nature underscores a robust and evolving landscape, propelled by both foundational advancements and fresh innovation in legal AI technology.
New UK law firm cyber research finds over one million passwords on the dark web (Legal IT Insider)
The research published by Atlas Cloud unveils a concerning cybersecurity landscape among UK-based law firms. With 72.2% of audited firms having employee passwords circulating on the dark web, and an average of 195 password breaches per firm, the alarming exposure accentuates the urgency for robust cybersecurity measures. The findings align with an escalating trend, as cyber-attacks on UK law firms have surged by 77% in the past year. Despite the critical need, less than half (46.2%) have implemented DMARC protocols, while only 14.7% are Cyber Essentials certified. These statistics highlight the sector’s vulnerability, underscoring the necessity for multi-factor authentication and comprehensive phishing protections. In essence, enhancing cyber awareness and adopting stringent security protocols are paramount to safeguarding sensitive legal data.
California and artificial intelligence laws (Inside Tech Law)
On September 17, 2024, California advanced digital rights protection by enacting AB 1836 and AB 2602 concerning artificial intelligence in digital replicas. AB 1836, effective January 1, 2026, safeguards the likeness of deceased personalities, mandating consent for digital replica creation and distribution, imposing liability for unauthorized use. AB 2602, effective January 1, 2025, empowers actors and artists by rendering clauses in contracts that allow unpermitted digital replication unenforceable unless explicitly detailed and negotiated. These laws ensure comprehensive protection for both the intellectual property of deceased personalities and the control of living artists over their digital likenesses, signifying a significant regulatory advance in the digital age.
All the rest
Harvey to launch in London – and is hiring (Legal IT Insider)
California-based legal AI startup Harvey is opening a London office to expand in Europe. The company will hire for sales, business development, customer success, and AI research roles. London is a strategic choice due to its AI talent and academic resources, with Harvey already serving over 40 European firms.
Exclusive: CRM vendor Nexl to acquire revenue operations startup Databall (Legal IT Insider)
Australian CRM vendor Nexl is acquiring revenue operations startup Databall. This acquisition aims to enhance Nexl's data aggregation capabilities, helping law firms identify opportunities and risks. CEO Philipp Thurner believes this will strengthen strategic growth decisions for their clients.
Kennedys appoints new CIO and first-ever CKO (Legal IT Insider)
Kennedys has appointed Paul Brotzel as CIO and Catherine Goodman as chief knowledge officer. Brotzel will manage global IT strategy, while Goodman will focus on knowledge management. These appointments demonstrate Kennedys' commitment to technological innovation in the legal and insurance sectors.
How Spellbook Is Implementing OpenAI o1 Into Legal Workflows (Artificial Lawyer)
Scott Stevenson, CEO of Spellbook, unveiled the new AI model o1, designed to enhance legal document tasks. The model offers complex document revisions, numerical accuracy, and multi-step workflows through advanced System 2 thinking. Spellbook Associate uses o1 to deliver more reliable and efficient legal AI solutions.
Kira Spin-off Zuva Unveils New Contract Review AI For In-house Legal Teams, Zuva Analyze (LawSites)
Zuva, a spin-off from Kira post its 2021 acquisition by Litera, has introduced Zuva Analyze, an AI tool for faster contract reviews. The tool, aimed at corporate legal departments, offers flexible pricing and a free trial. Zuva's CEO emphasizes its speed, user-friendly interface, and adaptability for both subscription and project-based use.
Sixteen years ago, cloud-based law practice management software transformed legal tech for small firms. Recent consolidations have resulted in most platforms being owned by six main groups, sparking concerns about competition and pricing. Lawyers need to know who owns their software due to ethical obligations and potential impacts on service and security.
Nexl has acquired Databall to boost its legal business transformation platform. This acquisition enhances Nexl’s client intelligence and CRM capabilities. Law firms will gain deeper insights, stronger relationships, and accelerated growth.
Proteus Discovery Group has acquired Novitas Data, doubling its size and expanding its eDiscovery services and geographic reach. The merger combines Novitas' infrastructure with Proteus' expertise to offer cost-effective solutions. Leaders from both companies are enthusiastic about the enhanced client experience this alignment will bring.
Workday acquires Evisort to surface insights for customers across HR and finance (Legal IT Insider)
Workday, Inc. is set to acquire AI contract management company Evisort. Evisort's AI technology will help Workday customers analyze unstructured data in contracts and documents. This acquisition aims to enhance business decision-making speed and efficiency.
PwC hires former Syke/LOD US managing director Lewis Bretts (Legal IT Insider)
Lewis Bretts, former managing director at Syke/LOD, has joined PwC as a partner in the legal technology team. He will focus on AI, legal tech, and managed legal services. This appointment underscores PwC's commitment to investing in legal technology through recent director appointments and global partnerships.
HR Company Workday Buys CLM Evisort (Artificial Lawyer)
Workday will acquire Evisort to enhance its finance and HR platform with AI-powered document intelligence. This integration aims to help customers efficiently extract and utilize critical data from documents. The deal, advised by Orrick and Goodwin, is expected to close by October 31, 2024.
Product Walk Through: Zuva’s New Contract Review AI – Analyze (Artificial Lawyer)
Zuva, founded by Noah Waisberg, has launched Analyze, an AI tool for in-house legal teams to review contracts. Analyze uses generative AI and machine learning for accurate results on large document sets and features project-based pricing. The Legal Innovators UK conference in London will discuss generative AI's impact on the legal sector.
The law practice management market is now dominated by six major ownership groups, including AffiniPay, CARET, Clio, Paradigm, and ProfitSolv, which have acquired numerous platforms. Companies like Clio and CARET are focusing on cloud-based solutions and new product launches. Despite this consolidation, some independent platforms still offer diverse options in the market.
The Billable Hour and [vs.?] Pricing AI-Driven Legal Services (Adam Smith, Esq.)
The article explores how Generative AI could disrupt the legal industry's billable hour pricing model. Despite forecasts, the billable hour still prevails due to ingrained habits. The authors speculate on AI's potential to transform this traditional practice.
Reveal has introduced its Logikcull platform in Europe, providing a self-service eDiscovery option. This complements its existing enterprise-grade, AI-powered platform. The expansion aims to improve efficiency and compliance for legal teams, addressing DSARs and GDPR challenges.
RP Legal & Tax Associazione Professionale (RPLT) has adopted NetDocuments as its new cloud-based document management system. The firm, recently formed by a merger, chose NetDocuments for its user-friendliness and strong security features. RPLT aims to improve efficiency and explore AI integration with NetDocuments' support.
SME law firms are focusing on client experience and digital transformation to increase revenue by 2025. Access Legal aids this effort by offering technology solutions and acquiring the communication app inCase. Understanding ROI and managing costs are also crucial for these firms.
MacroAgility Systems has launched SyncTools, a new addition to the iSyncKit suite, to automate iManage task management. The tool offers features like bulk security updates, auto-deletion of documents, and email metadata correction, enhancing efficiency and compliance. SyncTools is designed for easy setup and updates, simplifying document management for law firms and organizations.
Consilio launched Guided AI Review, integrating AI and human expertise for precise legal reviews. Reveal introduced Logikcull’s cloud-based eDiscovery solution in Europe, improving compliance and scalability. Zuva launched Analyze, an AI contract review tool with structured data and a pay-as-you-go model for corporate legal teams.
Legal Tech Leveller, Eve, Announces AI Agents + ‘Blueprints’ (Artificial Lawyer)
Eve, a legal genAI startup, has launched new tools like dynamic Blueprints, real-time In-Line Editing, and advanced AI Agents to aid plaintiff-side law firms. These features aim to help smaller law firms save time and costs while improving efficiency. With substantial seed funding, Eve demonstrates how legal tech can level the playing field for Small Law against BigLaw.
In A Marriage of Legal Education Companies, BARBRI Acquires SkillBurst Interactive (LawSites)
BARBRI has acquired SkillBurst Interactive to boost its legal education services. This move will offer innovative, multilingual, and interactive learning solutions for law firms and legal professionals. The acquisition aims to expand BARBRI's global reach and enhance digital legal training with advanced technology.
Which Legal AI Pioneers Are Still Independent? (Artificial Lawyer)
The article reviews the evolution of pioneering legal AI companies from the early to mid-2010s, noting many have been absorbed or evolved with generative AI. Companies like Luminance, BlackBoiler, and LawGeex are highlighted for their current independence and new AI approaches. The piece concludes by acknowledging their lasting impact on legal tech and promotes the Legal Innovators UK Conference.
Mary Technology Bags $920K Pre-Seed Funding For Chronologies (Artificial Lawyer)
Sydney's Mary Technology raised $920,000 in Pre-Seed funding led by Empress Capital and investor Sam Nickless. The AI-driven company, awarded ‘Best New Legal Startup,’ uses machine learning and GPT models to quickly generate detailed legal chronologies. The funds will support team expansion and US operations to simplify legal processes for lawyers.
The article discusses the consolidation of law practice management technology among six major ownership groups. This shift is driven by the move from on-premises to cloud-based platforms, influenced by ease of use, technology mandates, and the pandemic. Future growth will focus on expanding market reach, enhancing features, and integrating new technologies like generative AI.
Steno has appointed Prabhdeep Singh as COO to help scale the company from $100 million to $1 billion. His extensive experience in technology and operations is expected to drive significant growth and maintain high service quality. The company's innovative Transcript Genius tool and plans to expand its product line are key to its success.
Building a generationally integrated law firm (Jordan Furlong)
The article highlights generational differences in law firms and stresses the importance of de-escalation and constructive solutions. Key strategies include tailored communication, clear expectations, and inter-generational cooperation in business development. Respect and understanding among age groups can turn generational diversity into a competitive advantage.
Steno has appointed Prabhdeep Singh as Chief Operating Officer to enhance operations and support its rapid growth. Singh brings experience from high-growth tech companies like Clover, WeWork, and Uber. Steno aims to revolutionize legal support services through innovative technology and a concierge service approach.
MacroAgility Systems has introduced Import Master, a tool for efficient document and folder imports into iManage Work. Key features include Rollback Job, Retry Error, faster import speeds, and broad compatibility with network shares and legacy systems. Import Master enhances productivity and compliance by ensuring secure and reliable file transfers.
Consilio has introduced Guided AI Review, blending AI and human expertise to enhance document review accuracy and efficiency in the legal industry. The solution addresses AI trust issues by combining custom algorithms with experienced professionals. Consilio will expand this service through a partner program, offering the toolset via API.
LinkedIn suspends opt-out AI model training for UK following ICO concerns (Legal IT Insider)
LinkedIn reversed its decision to use UK customer data for AI training after public backlash and concerns from the UK Information Commissioner’s Office (ICO). The ICO praised LinkedIn's move and stressed the importance of public trust in privacy rights. Data privacy experts highlighted the ICO's vital role in regulating AI and ensuring compliance with data protection laws.
Navigating AI Liability Risks (Technology's Legal Edge)
The article examines new EU and UK directives on AI liability and regulation. It highlights challenges in proving causation and potential liability sharing among manufacturers. The EU's stringent framework contrasts with the UK's less comprehensive approach.
Infodash has partnered with LexisNexis to offer law firms seamless access to extensive legal information. This integration enables firms to create dynamic pages combining LexisNexis data with internal resources. The collaboration aims to improve decision-making, efficiency, and overall firm performance.
