Future-Proofing the Legal Practice: Embracing Generative AI

We’re past the “rise” of generative AI. AI is here to stay, and is driving significant transformation in the legal industry. But there’s a lot of hype around AI; many software providers are scrambling to weave AI into their offerings in a bid for relevance, and many firms are searching for ways to weave AI into their operating strategy. So how do you know where to apply AI? We’ll take a look at popular applications of GenAI, and considerations for incorporating this new tech into your firm’s strategy.

What is Generative AI?

First, we’ll define our terms: GenAI is a subset of artificial intelligence (AI) that creates content like text, images, or code by learnig from vast datasets. Unlike traditional AI, it generates new outputs. Large Language Models (LLMs) are a key type, trained on text data to generate coherent, contextually relevant text from prompts.

Generative AI uses machine learning models trained on large datasets to learn patterns and structures. Once trained, it generates new content based on an initial input, mimicking the style and structure of its training data. For example, in text generation, the model predicts the next word or sentence based on input provided and can refine its output over multiple steps. Feedback loops help improve the quality of the generated content over time. While impressive, it requires oversight to ensure accuracy and quality.

Why should lawyers care about generative AI?

Again: the age of AI is here. The legal industry is at a crossroads, with technology reshaping workflows and redefining efficiency. Generative AI automates repetitive tasks and enhances legal work. For law firms, integrating this technology is crucial to remain competitive.

Lawyers spend significant time on repetitive tasks like document review, legal research, and drafting. Generative AI automates and accelerates these processes, allowing lawyers to focus on strategic analysis. LLMs can quickly analyze vast data amounts to provide summaries or identify key information. For example, an attorney can use generative AI to analyze thousands of documents and uncover key patterns or evidence within minutes.

Embracing generative AI is essential for adapting to a changing industry. Clients expect legal counsel to use cutting-edge tools that enhance accuracy and reduce costs. Firms that resist risk falling behind competitors who leverage AI to deliver faster, more cost-effective, and impactful results, which could mean losing clients, talent, and market relevance.

Generative AI tools for lawyers

According to Bloomberg Law's 2023 State of Practice: Legal Landscape report, attorneys are increasingly leveraging generative AI to streamline various aspects of their work, with 58% using it for drafting communications, 53% for legal research, 42% for summarizing narratives, 34% for reviewing legal documents, and 23% for drafting/templating legal contracts. This growing adoption of generative AI is driving innovation across the legal industry. Here are some key categories of generative AI tools transforming legal practice:

Legal research tools

Generative AI-powered legal research tools are transforming how lawyers find and interpret legal information by analyzing massive volumes of documents, case law, statutes, and regulatory materials to identify the most relevant precedents, generate concise summaries, and highlight connections across different sources. 

For example, a lawyer preparing a motion to dismiss could input specific keywords or legal issues into a generative AI legal research tool, which might then produce a tailored report summarizing relevant case law, statutes, and even potential opposing arguments. These tools accelerate research, expand its scope, and reduce the risk of overlooking critical information, especially in complex areas like antitrust or intellectual property law.

Document drafting tools

Generative AI document drafting tools help lawyers simplify the process of creating memos, contracts, pleadings, and other legal documents. These tools automate the initial drafting process and generate polished outputs based on specific needs within minutes. By cross-referencing vast legal databases and precedents, they can help reduce errors, ensure compliance with legal standards, and incorporate relevant precedents or clauses. These tools can also recommend alternative clauses based on industry best practices or market trends. These automated processes enable lawyers to work more quickly when faced with tight deadlines, as well as free up time and energy for high-value work such as negotiation prep or client service.

Contract review and analysis tools

Generative AI tools for contract review and analysis are transforming due diligence, compliance, and risk management processes. These tools can automatically analyze contracts to identify risks, inconsistencies, deviations from standard terms, or missing clauses. These tools can compare contracts against custom playbooks or market standards, swiftly pinpointing areas that may require pushback, negotiation, or further risk assessment.

For example, during an M&A due diligence process, a generative AI tool can quickly analyze hundreds of supplier agreements, highlighting unusual termination clauses or missing indemnification provisions. This helps ensure that critical risks are spotted and addressed before deal close, no matter how short the timeline.

Time-tracking tools

Accurate time capture is crucial for client billing compliance and velocity, and law firms face challenges with traditional, manual time capture methods. Traditional time tracking is prone to errors and omissions, leading to significant revenue leakage. Lawyers often juggle multiple matters for different clients, making it hard to recall and reconstruct their work at the end of a busy day. This leads to delays in time tracking and when they finally attempt to reconcile their billable tasks, the recorded time entries may lack precision, omit important details, or fail to fully capture the scope of their billable time. As a result, more than 12% of billable hours are never invoiced, resulting in significant revenue leakage.

AI Time tools like Laurel are transforming this landscape by automatically capturing billable activities across platforms like Outlook, Zoom, Word, and phone calls. These systems handle everything from UTBMS coding to client matter matching and billing guideline compliance. By eliminating the need for manual time entry, law firms can reduce the risk of missed billable time. After Tonkon Torp LLP, a leading Portland, Oregon law firm, implemented Laurel, they saw their attorneys record an additional 21 billable minutes per attorney daily, resulting in $20,000 in additional annual revenue per attorney.

Automating time capture not only prevents revenue leakage but also frees lawyers from the constant interruptions and mental strain of manual time tracking. Attorneys already face long hours, and the added burden of recalling every billable task for each client detracts from their ability to focus on high-value legal work. AI timekeeping solutions address this challenge by reducing manual effort, minimizing errors, and alleviating the administrative burden of non-billable tasks, allowing attorneys to focus their time on billable work.

E-discovery tools

Generative AI e-discovery tools transform the process of identifying and reviewing electronic data for legal cases. These tools can quickly analyze vast datasets and quickly locate relevant information based on specific criteria, such as keywords or timelines. They can highlight inconsistencies, categorize files by relevance, and automatically flag sensitive or privileged material, reducing the risk of accidental disclosure. AI can identify key communications and patterns, such as unusual spikes in activity, that offer valuable insights for litigation strategy. 

Beyond improving accuracy, these tools significantly reduce the time and cost of e-discovery. Tasks that traditionally required large teams and weeks of around-the-clock effort can now be completed in hours, freeing legal teams to focus on higher-value activities like case preparation and client strategy. 

Adopting GenAI means future proofing your firm

GenAI represents a transformative opportunity for law firms to boost productivity, improve accuracy, and enhance client satisfaction. Law firms that lead the way in adopting generative AI technology will not only optimize their operations but also gain a competitive edge in attracting clients, retaining top talent, and delivering exceptional outcomes.

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