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Generative AI for Legal Firms and its Use Cases 

Jagreet Kaur | 09 May 2023

Introduction to Generative AI for Legal

In Legal Industry, Generative AI has emerged as a game-changing technology. Generative AI analyzes large datasets using deep learning algorithms and neural networks and generates new data based on analysis from the existing data.

The introduction of Generative AI has the potential to revolutionize the way lawyers work by enabling faster and more accurate practices. It has potential uses for automating legal processes and improving efficiency.

AI is the reproduction of intelligent human processes, especially machines and computer systems. Taken From Article, Artificial Intelligence Adoption Best Practices

History of Generative AI

The use of technology in the legal process dates back to the 1960s. In the early years, technology had been mainly used for automating tasks such as document management, word processing, and billing. Over time, as technology advances, new applications are being developed that have significantly transformed the legal industry. This technology has revolutionized how lawyers handle large volumes of documents and data, making the process faster and more accurate.  

In recent years, the legal industry has seen a significant increase in using artificial intelligence (AI) technology.

What are the Key Advantages of Generative AI?

  • Creativity: Generative AI is being designed to obtain new data and content based on existing databases, which means it has the potential to be more creative than traditional AI. Generative-AI can be used explicitly in the legal industry for tasks such as document drafting or contract review. Creativity is required to ensure the document or contract is legally sound and meets the client's needs.
  • Flexibility: Generative AI is more flexible than traditional AI because it can adapt to new situations and generate new content or data based on new input. This makes it particularly useful in the legal industry, where lawyers often deal with new and unique cases.
  • Efficiency: Generative AI can be more efficient than traditional AI because it automatically generates new content or data. It reduces the time and effort lawyers require to perform repetitive tasks such as document drafting or contract review.
  • Accuracy: Generative AI can be more accurate than traditional AI because it can generate new content or data based on a large volume of already existing data, which means it can identify patterns, thereby making predictions more accurately.
Unified Big Data platform to integrate different sources and Data Migration tasks using a single dashboard. Taken From Article, Big Data Compliance

Use Cases of Generative AI

Use Cases of Generative AI in Legal firms are:

Automation in Legal Tasks

One of the most significant applications of Generative AI in the legal industry is drafting legal documents. Lawyers spend significant time drafting legal documents such as contracts, leases, and agreements, which can be time-consuming and tedious.  

Generative AI can automate this process by analyzing previous versions of similar documents and generating new versions that adhere to established legal standards and incorporate new provisions. Hence, it improves the efficiency of the process and reduces human efforts, thereby reducing the workload for legal professionals.

Compliance / Updations

When there are regulatory changes by law, every professional must comply with and adopt them. One must rely on something other than a particular law since it keeps changing. To do best practices, legal professionals need to monitor and know the changes.

The problem arises because there are many clients, and so are the documents associated with them. The situations can be diverse. Generative AI ensures that businesses/ organisations/ any association/ body remain compliant with relevant laws and industry standards by alerting them of all the alterations that may affect their operations and management.  

Reviewing Important Contracts

Contract Reviewing is a very time-consuming task. Such a tedious task requires great attention, which a person can lose over time. Generative AI is beneficial in reviewing necessary contracts and analysing them. It identifies the issues such as outdated regulations which need to be more compliant. This can be particularly useful in reviewing complex contracts that contain multiple clauses and provisions. Generative AI can identify inconsistencies between clauses, ensuring that the contract is legally sound and that all provisions are aligned with the client's needs.

Error Detection

Legal pleadings contain documents such as motions, complaints, and answers which are critical. Legal professionals ensure that all those documents are legally sound and reflect the client's needs. Generative AI analyses legal pleadings to detect typographical, grammatical, and factual errors. This simplifies the negotiations and mitigates the dispute risks.

Creating Diligence Reports

The other important aspect of Generative AI in legal is due diligence in generating Diligence Reports. These reports involve conducting a comprehensive review of a company's legal and financial records to identify potential risks and liabilities.

Generative AI analyzes large volumes of financial, corporate transactions and legal data to identify potential risks and liabilities. It can automatically extract relevant data from legal and financial documents, such as contracts, financial statements, and regulatory filings. By analyzing this data, Generative AI identifies potential risks and liabilities, such as non-compliance with legal or regulatory requirements, potential litigation risks, and financial irregularities

Data Extraction and Summarising Documents

To enable the lawyers to represent their clients in legal proceedings, Generative AI extracts important information and binding contracts and creates summaries of documents. By analyzing the results of previous diligence reports, Generative AI can identify patterns and improve its ability to identify potential risks and liabilities. AI in creating diligence reports can save lawyers significant time and effort while improving the accuracy and effectiveness of the due diligence process.

Intellectual Property Management

Intellectual Property Management, as per IPRA, involves managing a company's intellectual property assets, including patents, trademarks, and copyrights. It involves identifying, protecting, and enforcing intellectual property rights to prevent infringement and unauthorized use of these assets.

Generative AI can also analyze patent and trademark databases to identify potential gaps in a company's IP portfolio. It can automatically monitor and identify potential infringing products or services, using machine learning algorithms to identify patterns and anomalies that may indicate infringement.

Easy Access to Information

Generative AI can be used to facilitate lawyers with rapid and easy access to legal research. It saves them a lot of time they need to spend on thorough research By analyzing legal databases. Generative AI can provide lawyers with relevant case law and legal precedents to support their arguments and guide their clients accurately. It can also analyze legal documents to identify critical issues and provide recommendations for legal strategy.

Legal Chatbots

Generative AI can be incorporated into legal chatbots to provide a personalised experience to clients seeking legal advice. It can be trained to answer client queries and advise them more accurately by analyzing the previous relevant records. 
Explanation of legal concepts and processes can be enabled with evolving regulations. Generative AI tends to learn from past cases, give better advice, and change the responses per the new scenario.

It saves the lawyers and clients time to approach the potential professional and get advice that may or may not work out later.

Legal Research

Going through all the records, regulations, agreements, and processes takes much time. Generative AI identifies trends and draws patterns that would be difficult for human researchers to identify, allowing lawyers to make more informed legal decisions.

Generative AI in legal research can save lawyers time and effort while improving the accuracy and effectiveness of legal research.

An Enterprise AI Chatbot Platform provides a comprehensive solution for businesses to create, deploy, and manage chatbots. Taken From Article, Enterprise AI Chatbot Platform

What are the drawbacks of Generative AI in Legal Services?

While Generative AI has numerous use cases and the potential to improve the efficiency and accuracy of legal work, it is essential to be aware of its limitations and ensure that it is used ethically and appropriately within the legal industry.

  • Legal Ethics: The use of Generative AI in legal tasks, such as contract review and legal research, raises important ethical questions about using automated tools in legal decision-making. This may lead to violating ethical standards and dehumanising the legal profession.
  • Bias: It entirely depends on the data it is trained on. If the existing data on which it is trained contains biases, such as gender or racial bias, the Generative AI may also produce biased results. This is particularly concerning in the legal industry, where decisions can have significant consequences for individuals and society.
  • Human Interaction: Such tools cannot replace human touch and creativity. Legal work often involves:
  1. Relationship-building with clients.
  2. Providing advice and guidance.
  3. Making complex decisions based on various factors.

While Generative AI can support legal work, more is needed to replace the expertise and judgment of a human lawyer.

  • Security: Data security is a significant concern as legal data and information are susceptible and confidential. It is a concerning point, mainly if it is hosted on a cloud-based platform or managed by a third-party vendor.

What are the future trends of Generative AI in Legal Services?

The future trends of Generative AI for Legal Firms are: 

Integration with Blockchain

There is an increase in the use of blockchain technology in the legal industry and the opportunity to integrate Generative AI with blockchain to improve legal document management and increase transparency and accountability. For example, Generative AI could automatically verify the authenticity and accuracy of legal documents on a blockchain platform.  

Improved Explainability

One of the challenges of using Generative AI in legal tasks is that it can take time to explain how the AI arrived at its conclusions. However, advances in Explainable AI (XAI) will likely improve the transparency and interpretability of Generative AI, making it easier for lawyers to understand and trust the results.

Increased Collaboration with Human Lawyers

In the future, we expect to witness more collaboration between human lawyers and Generative AI tools, with AI-aided lawyers/ legal professionals in complex legal tasks and supporting decision-making.

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The Adoption of Generative AI in the legal industry unfolds many advantages like improved efficiency, accuracy, and cost optimisation. Lawyers can focus on more complex and nuanced legal issues by automating routine tasks such as contract review, legal research, and intellectual property management. Overall, Generative AI has the potential to transform law practices and workflow and provide significant benefits to lawyers, clients, and society as a whole. Implementing Generative AI in the legal industry would require changes to traditional legal practices and workflows.