Having worked in a law office, I can say confidently that the future of legal AI is human+AI. AI can rapidly spot all the issues, saving expensive lawyers from spending their time wading through the documents. But the human lawyer brings strategy, judgement and face-to-face consultation to the process.
In other words, I don't think lawyers are in danger. But law clerks? Junior staff? The people who are usually forced to do all the grunt work to allow the top lawyers to focus on their strengths? Those jobs are at definitely on the chopping block. There's still an insane amount of rote repetitive work in your standard law firm.
Isn't that grunt work usually a launch pad or part of the practice of becoming a lawyer? If so, how will future lawyers train to learn as well? Likewise I wonder how does this similarly impact education for medical professions.
I immediately asked myself the same question and I think it could happen like so:
The new tools available to law professionals will decrease the barrier of entry to the ecosystem.
The low level workers displaced by these new AI companions will decide that since they can't beat them, they'll join them.
A new "discount" class of lawyer will begin to emerge characterized by lower quality of work but also lower fees. Many of those low level workers will move to this sector and may even make more than they would in the current system.
These increased wages are eventually tempered back down close to their modern day equivalent again due to the decreased barrier of entry allowing other segments of the population to pursue Law as a viable career opportunity.
Law services, albeit on average lower quality ones, will become available to a greater portion of the population, particularly those with a relatively low income.
"Law Bootcamps" will shock the world just as their code predecessors did, but again keeping in fashion with the original ventures, they will be here to stay contrary to the Old Guard's cries of incompetence.
We will see a massive uptick in the number of lawsuits submitted. Looking at someone the wrong way will become an intolerable risk and everyone will choose to live out the rest of their lives inside so as to avoid having their money taken by the now rampant sue-happy racketeers terrorizing the outside word.
And thus The Great Potato Couch Famine of 2022 begins. An estimated 3,000,000 become so agoraphobic that they choose starvation rather than face the sue-apocalypse ravaging outside their doors.
Amazon steps in with food delivery drones and cybernetic surrogates programmed to follow every letter of The Law. People are able to avoid the scourge of the Famine and exert their influence on spaces outside once again all from the safety and comfort of their own homes.
Amazon's stock price soars to record shattering heights which they in turn pump into newer and greater AI technologies. On July 23rd of 2029, Alexa finally wakes up...
_Great Potato Couch Famine fanfic and merchandise coming soon_
An excellent dystopian story. One thing I'd add to your prediction is that the complexity of laws will increase massively because computers will be interpreting the law. There won't be an incentive to keep it simple enough for a human to understand. The same thing has been happening with taxes -- since most people and businesses use tax programs, there is no push back on the complexity of taxation rules. In fact, companies that make tax preparation software lobby to keep the complexity.
Another thing I'd add is that Human Resources departments at companies and governments will become even powerful than they already are (because everyone is suing everyone).
Dystopian hyperbole aside, your point about law complexity is a good one. Our current system is arguably already too complex. Anyone attempting to build a home can attest to that. But at the very least we are able to move through our day to day lives without worrying too much about accidentally breaking the law because it tends to reflect common sense.
But as you say, new tech would highlight all of the inconsistencies, new laws would be put in place to fill in the cracks and so on until it all becomes a massive web so complex that grey areas become too hazardous to risk.
I can imagine how that might even inadvertently stifle innovation. Considering that new ideas are found on the cutting edge (see Uber, Airbnb, crypto assets) and that the cutting edge is inherently a grey area, small business might become so wary of it that they give up innovating altogether.
Human progress would be left to the whims of only the largest companies with the means to take on the risk. Ironically, progress would prove to be the killer of progress.
May we all live in interesting times, eh? Perhaps this will be one of the few times in history where a sluggish, unresponsive government proves to be an advantage, haha
> But at the very least we are able to move through our day to day lives without worrying too much about accidentally breaking the law
Rephrase to: without worrying about being prosecuted for the laws you're unknowingly breaking. Because we're almost certainly breaking at least 1 law per day.
Building memory maps and doing register allocation by hand is excellent training for becoming a computer programmer, but nobody's done it since compilers become decent.
Well, people who work on video codecs, low-level crypto code, and compilers themselves do manual register allocation when they write platform-specific assembler stubs, but yeah, it's rare.
If it's so menial and you "don't learn anything", then why not just pay people off of the street to do it?
I think you're heavily discounting the fact that searching through case law is not just "type in words into LexisNexis", but it's searching, parsing and consolidating case law that is relevant for a Partner. You actually read the case law, spend time understanding it, and build a report around it.
If you implemented the same compression algorithm over and over again, each time from scratch, the only skill you'd learn would be how to do it more efficiently. You wouldn't learn anything special, except maybe some nuances of the algorithm you didn't already know.
Yeah it's not a skill that everyone can do, but once trained to do it there's no point only doing that same task over and over because you won't advance your skills in other aspects of the field.
That's a flawed analogy. It's more like implementing compression of different data under different conditions every time, which would train you to get much better with compression and programming in general.
Every case has its own unique characteristics. It's not just doing the same thing over and over again.
Comparing a simple compression algorithm to extensive law research is extremely disingenuous and shows a lack of awareness of what it takes to actually BE competent as a lawyer.
Just because it's not as difficult/involved as being a lawyer, while also not training you how to be a good lawyer, doesn't mean that it doesn't still require an education. An education to be able to understand the documentation and law you are working with.
But at the same time not all of them require law degrees either, many para-legals and helpers aren't full lawyers.
True. But this will reduce a lot of demand for human legal services, since the few humans left will be more effective per hour. Unfortunately the pipeline to produce senior lawyers is packed as if AI isn’t coming, and for that cohort life is going to suck a bit.
On the other hand, maybe the cost to review an employment agreement will enter into the sub-$100 range. Or to draft an NDA for a startup, etc.
The path from passing the bar to being a successful / well-paid attorney has been extremely difficult for a decade now. AI will simply continue this trend.
> But law clerks? Junior staff? The people who are usually forced to do all the grunt work to allow the top lawyers to focus on their strengths?
The same thing happened in finance, first with Excel and then with quants. Junior staff responsibilities shift to more client-facing work while senior staff are newly enabled to break off and start small firms.
It's strange, excel and greenscreen pricing grids could do 100x-1000x what a traditional pen and paper cash trader could do in the 80s, but trading/technology headcount increased massively since then.
Automation doesn't always kill total avaliable jobs like critics claim, it's only when your potential marketplace is totally maxed out that it starts affecting the total workforce. Most service industries aren't there yet, hence the increase
> trading/technology headcount increased massively since then
Lower costs spur demand. Headcount went up a bit, throughput much more massively. If tech makes lawyers more affordable, that would increase the quantity demanded.
This looks great for clients, but I think you’re right about law clerks and the like, and the implications are a little sad.
Time was if you wanted to get into law you’d join a firm as a clerk, learn the ropes, study for the bar, then become a lawyer.
The professionalizarion of law has pretty much ended that pipeline, with an expensive and arduous undergrad->law school->lawyer route instead. The replacement of junior staff with AI could effectively kill that route permanently.
My only hope is that legal AI will help bring down cost and increase access to legal aid for poor people in urban and rural communities where there is far too little supply to meet demand when people need legal aid the most.
>Time was if you wanted to get into law you’d join a firm as a clerk, learn the ropes, study for the bar, then become a lawyer....The replacement of junior staff with AI could effectively kill that route permanently.
That ship has sailed long long ago...like, 1890 long ago. There are states where you can read law and take the bar exam without a law degree (Virginia, California, Vermont, Washington), or with a partial law degree (New York and Maine), but the number of people who do that each year is minuscule compared to the number of lawyers who graduated from law school (60 to 84,000 in 2013).
>That ship has sailed long long ago...like, 1890 long ago.
In California, at least, that is still the only way become a lawyer without a law degree (called the "Law Office Study Program"). If you forgo law school, you are required to do an apprenticeship in a practicing attorney's office for 4 continuous years (18 hours/week, 48 weeks/year), along with taking various exams and reporting your study progress.
He's not saying it's impossible. He's saying the number of people doing it is so small as to be irrelevant to general arguments. While a much larger percentage (relatively) of people may have used this path ("reading into the law") a hundred years ago, it has largely faded from relevance in modern times.
>The replacement of junior staff with AI could effectively kill that route permanently.
iirc only a handful of states still allow you to take the bar without a law degree (and in practice I have no idea how often that happens, but I bet not much.) It seems like the apprenticeship route was by and large killed off some time ago.
"saving expensive lawyers from spending their time wading through the documents."
Do lawyers want to lose that much time in billable hours? I'd imagine part of what lawyers like is making lots of money and this will be a limiter.
> Do lawyers want to lose that much time in billable hours?
Their options are to lose that much time in billable hours, or to lose all their billable hours because the client found a law firm that doesn't bill so many hours for grunt work.
I don't see it as all the different than a software developer automating a repetitive build/config task, or a test engineer automating some basic functional tests.
Yes, the lawyer bills by the hour. But, a good lawyer will have enough work either way - so they may as well automate the easy stuff, take a reduced rate for that, and still have a full-plate of interesting work at their full hourly rate.
If you didn't notice, google.com alone brought utter devastation upon junior paralegals almost as soon as it became a thing.
>But the human lawyer brings strategy, judgement and face-to-face consultation to the process.
My observation about all white collar jobs to which epithets "creative" and "strategic" are applicable: they are way way more vulnerable to automation than a "grunt" work.
Look how fast marketing profession turned from creative to number crunching, and the only guys who are left in the field from "the old industry" are from its "grunty" part
Can't AI eventually bring better strategy and judgement ?
The face to face consultation process doesn't require lawyers either, but more of a social worker role who can act as a buffer for some people and the AI ?
Give me the option between lawyers and AI. I'll choose the AI, as I've been burned pretty badly by lawyers before.
The degree's don't cause and effect competence.
I went to court a year or so ago to contest a ticket and the judge started the session by saying: “I don’t want to hear any excuses about financial hardship or special circumstances. We are all created equal” I think he is pretty replaceable by an AI.
That quote proves nothing, except the judge was unwilling to take financial hardship or special circumstances into account for your challenge. Which is appropriate, because the law as written does not allow for that. (Infractions like traffic violations are generally fixed penalties.)
If you had wanted to challenge the validity of the ticket and the judge said he didn't care about the facts, that would have been a different thing altogether.
A judge can absolutely reduce a fine at their discretion, the judge blatantly refusing to use his discretion and human judgement in favor of a black and white view of the law is why he could easily be replaced with a machine.
No, a judge cannot "absolutely" reduce a fine for an administrative violation or infraction at their discretion. It depends on the jurisdiction. With some rulebreaking, the punishment is all-or-nothing.
Lawyers may have those concepts outside of their legal work, but I've dealt with enough to say its no guarantee a lawyer may care about equity,justice, fairness, etc.
Those lawyers have a different concept of equity, justice, fairness, etc. from yours. It doesn't mean they don't embrace those concepts.
An AI simply doesn't have any of those concepts, and moreover, is incapable of understanding those concepts. We can barely get AI to understand natural language--squishy abstracts like these are several developmental revolutions away.
What I've heard (but many years ago) is that the legal profession in general is extremely tech-hostile (some is just cultural, but some is that it gets in the way of billable hours).
I don't know how much of that has changed now, especially with younger lawyers growing up with tech, getting in and wanting to do things a certain way.
I'm (somewhat) qualified to comment, having presented to an audience of lawyers in SF literally hours ago, and having been discussing/testing the market for most of this year.
I think there's roughly three groups - the old guard (senior partners at big firms), the younger ones who have gone out on their own, and the in-house counsel.
In my opinion, the old guard aren't tech-hostile, just disinterested. They haven't ever really needed to compete, and most have retirement on the horizon, so there's little incentive to invest money for a pay-off in five years' time.
Corporate counsel are still pretty unsophisticated when it comes to new tooling/platforms, except when it comes to cost management (where there's an enormous amount of interest).
The most tech-savvy are the smaller (3-30) firms who have broken off and are looking for ways to compete with their former employers.
That being said, it's still a very hands-on, enterprise-y market to sell to. I've been told that LawGeex, for reference, start at the (multiple) six-figure range to begin with.
We (https://lexico.io) didn't really want to go down that path, so we pivoted from automating legal drafting and review inside Word, to a broader paperwork automation assistant.
That has not been my experience. The industry is highly competitive. Each matter might be pitched to half a dozen firms. If tech does shave costs, that can be a huge differentiating factor.
For the most part though it doesn’t. There are many clients who won’t pay for first year associates. For those clients, firms don’t roll out legal tech. They do the work and write it off. Even at top wall street firms realization is 80-90% hours billed. Nor do firms trot out legal tech when it comes to contigency or fixed-fee cases, where there are no billable hours. Some major clients these days demand arrangements where they pay a fixed. monthly price. There is no legal tech leveraged in those cases.
For the most part I’ve found software in general these days to be underwhelming. It took me years to find software that I trust enough to keep track of highlighted points in court opinions. (Shout out to the folks who make Citavi.) I remember writing about predictive coding in law school almost ten years ago. I have never used it on a case. Ironically, the only cases where there were enough documents (millions) for predictive coding to make sense also involved so much at stake the client wanted to spare no expense.
The highest value legal tech has been review platforms like Relativity, but they are also crap. Like, loads documents slower than you can read them crap. It’s like technology to help programmers. You still just use Emacs because all this visual IDE shit doesn’t really help.
This is one of the things where the market will decide. All it takes is one firm to drastically reduce costs while maintaining standards (or possibly improving them?) and the rest will be forced follow suit.
It’s worse: the legal industry is efficiency-hostile because it relies heavily on reinventing the wheel on an hourly basis with the moat of a guild system to keep competition under control. And worse yet: most clients aren’t interested in anything less than the most expensive, white-glove service because they equate paying more to buying more peace of mind. In reality, most clients pay law firms gobs of money to read stuff that they can’t be bothered to read themselves. And law firms can’t even be held accountable for giving bad advice. It’s a pretty bleak landscape for problem-solvers.
I've heard though that something like 60% of actual legal work is done by paralegals. That was just an anecdote I heard from one paralegal, so it's definitely not a firm number.
In the middle ages, people saw the future as more castles, more knights, more kingdoms. Why? because noone could predict a paradigm shift.
Today you are doing the same as people in the middle ages. You are extending current paradigms into the far future, and that's how you are wrong.
You imagine the future as a future with more von Neumann machines, running some minor variant of deep learning, on electronics that are similar to the ones today.
I imagine the future as a future with more AI practitioners making progress faster, working with better tools, better hardware, standing on the shoulders of this generation, and the one after it.
Because of this, lawyers will have no future ahead of them in 50 years.
Time wasted reviewing pointless variations on the same old mutual NDA is a scourge. It's hard to take the profession's performative technophilia seriously while the most obvious, widespread inefficiency continues every day.
On the other hand, teaching computers to parse pointless variations of the same substantive terms in legalese accommodates bad practice, instead of correcting it. It's symptomatic treatment at best, enablement at worst.
Lawyers shouldn't be sending and receiving a thousand different NDAs for the same fundamental deal. They should be defining and evolving a shared vocabulary of common forms, and invoking them whenever cost-benefit favors a standard.
That's the idea behind a very recent project of mine, The Canting Tribe NDA:
It's a "viral" NDA. The website publishes a versioned form. The form includes a signed certificate guaranteeing that the proposal is identical to the version published on the site. On the site, newcomers see a list of firms using and accepting the form. The experience shows, rather than tells, how standardization can work.
I soft launched the project just a couple weeks ago. A couple firms signed on almost immediately. Several more are reviewing. My top priority is more firms on the website. Once the site provides enough baseline social proof, the form can spread word and create new users on its own.
For transactional clients with more than a few hours' needs every month, I cannot recommend flat-fee billing strongly enough, especially for clients with whom you've an established relationship.
The main benefit of this approach in my practice has been enabling me to do work that benefits multiple clients, and even current and potential future clients, without hesitation or administrative cost. There's no need to decide that one of five hours on a form goes to this client, two of five to that one, and one gets written off, as representing future clients who will need the same form, and so on.
Not tracking time has also been a net savings, though I recommend continuing to track tasks performed, journal-style. A journal helps me personally, makes it very easy to prepare good looking bills, and helps greatly in discussions about rate, which my engagement letter allows us to change, for future months, at any time. If I underestimate on rate, I can point to a long list of things accomplished. Often, the decision maker at the client simply didn't know that I was serving other groups at the company, or taking on other responsibilities, outside their field of view.
The main concern from other counsel has been that clients will gorge at the new "all you can eat lawyer buffet". If a client makes use of your time in a very piece-part, transactional fashion, that may indeed be a problem. But that has not been my experience. Clients have processes and habits in place for my work and seeking my advice. They're very hard to break, for better and worse. I do get far more communication from client personnel, but that has enabled me to be more proactive about systematizing and standardizing recurring needs, which in turn keeps me focused on the interesting, meaningful work.
That being said, I remain deeply cynical about whiz-bang technology in legal practice, especially when it's visible to the client, especially when it takes center stage. The less my clients know or care about the tools I'm using, the better I'm able to shield them from those details, the better the sign that I'm doing high-value work.
I, for one, really hate interrupting my workflow to read yet another MNDA form on short notice, only to find nothing warranting comment. Meanwhile, my client's deal is held up, waiting on me, which makes me seem a drag on Getting Business Done.
Businesspeople have to wait for review, but lawyers have to do the review. Both come away knowing that they've wasted precious time.
Thank you! My number one priority right now is getting more companies to sign up as users on the website. Even small, unheard of companies can make a huge difference at this stage!
I'm not sure quite what you mean by "design patterns". The NDA form itself is very orthodox in its language. I wrote it, intentionally, to be as little-surprising and easy to review, knee-jerk, as possible.
In other work, I'm fanatical about plain language, clean structure, and the reuse of components of language. The latter comes through in my open source project, Common Form, which essentially ports various software development tools---editor, linter, compiler, package manager---to contract drafting:
Or perhaps you mean "design patterns" more to do with the "viral" nature of the Canting Tribe NDA, a kind of voluntary, Internet-enabled standardization. I do have high hopes for that model. I'd love to see it work for NDAs, and reuse it for other kinds of transactions, including some with more inevitable terms variability. SaaS agreements, for example.
It's a software engineering technique to abstract and reuse software components, inspired by a similar concept in (physical) architecture. I was wondering if you wanted to do something similar, but of course with legal ah, entities (? What are contracts?) rather than software.
The wikipedia article I link to is not very good but the book is a staple in software engineering classes.
Alas, it's not entirely clear how to translate the idea into the contract context. There are many repeating patterns and structures in complex contracts, but they don't serve the same roles as patterns in software.
Funny you should mention! This is my third attempt at "The NDA Problem".
Attempt 1: Very modern, plain-language NDA. Much easier to read and follow. Substantively better. No uptake.
Attempt 2: Suite of NDAs for various use cases, integrated with e-signature, filing, attorney approval, the works. That was rxnda.com. Lots of positive feedback. Not much actual use.
Attempt 3: Canting Tribe. Zero code. All about the network effects. Much, much simpler.
I've tried to make the PDF copy of the form as easy to set up in place-the-blanks e-sig services as possible, with [bracketed instructions] to make clear what goes where. I would be very interested in an e-sig service that allowed me to preconfigure a template with the latest terms, for other people to use. I'd be very interested in ways to put metadata or other hints for setting up e-sig into any of the various formats the site publishes.
I used to have a list of companies offering something close to rxnda.com: NDA plus e-sig. I don't have it with me now. But I'm not aware of any other attempt at voluntary standardization of a general-purpose NDA. Several large companies with leverage have published their standard NDAs, or even set up e-sig portals, as Google has. But I'm not aware of any such forms offered for general use, between other companies.
I would not be surprised to learn of prior attempts, or approaches vaguely close to mine. Frankly, I don't care who solves this problem, or how, as long as it's solved. Canting Tribe is the best I have. I believe it can work, but I can't make it work alone.
I am a transactional lawyer and I definitely would find value in an application that could issue spot an agreement in seconds. That said, just yesterday I spoke on a panel on the topic of how things can go wrong in a contract. We spent the majority of time talking about the dynamics and challenges that exist outside the agreement in the process of trying to memorialize the parties’ intent in a clear, concise, precise and reasonably complete manner. There are often significant challenges in terms of clearly obtaining the intent and relevant issues from the various stakeholders. And there are dynamics like relative negotiating leverage and psychology or other issues that can drive what the deal will look like regardless of pure legal issues. Also, since one never starts with a blank page, there is the contract template one starts with that must be evaluated against all this – what stays, what goes, what must change and how. Navigating these requires intangible skills, instincts, sensitivity to human dynamics, etc. It’s very much a human endeavor. So a key question is to what extent AI could help with all of these external issues. I have to think that’s much farther down the road. But having help assessing purely legal issues within the document would be a great supplement.
With an AI, you don't know what it is that the AI doesn't know. A trivial example: Some "nondisclosure" agreements (NDAs) also include invention-assignment agreements [0] and/or non-competition covenants. I'll recognize such provisions if I see one in a putative NDA, but I don't know whether the AI will recognize it. Sure, the AI could provide a list of everything that it does know, but when I review the list, I won't necessarily notice that a missing item is missing.
This is an important point, although I can imagine AI could be trained to spot things that don't belong or are unusual provisions in an NDA. This may be what you're getting at, but it's easy in a contract review to focus on reacting to what's there and it's harder to know what's missing. An NDA is a relatively simple, cookie-cutter types of agreement with widely agreed elements. Other agreements not so much. How would AI figure out what's missing?
That's an important point, but I assume an AI would use some sort of checklist, perhaps seeded by human lawyers, to spot expected-but-missing provisions.
Statement from Professor Yonatan Aumann, advisor to Tel Aviv-based LawGeex, on LawGeex AI:
“The technology has been developed through a combination of supervised and unsupervised learning techniques. Unsupervised learning was used for teaching the AI engine the core legalese language. Thereafter, supervised learning, using deep learning multi-layer LSTM and convolution technology, was used to train the system for the fine-tuned issue-spotting. Supervision was performed based on human-annotated documents, using legal experts. A unique augmentation algorithm was applied to boost learning from these examples. The overall result is the most advanced technology for the automatic analysis of legal documents. The p-value for the statement that accuracy of AI is above that of these lawyers is 0.0068 (using MannWhitney’s U test).
Clicking on the link, I expected to discover a watershed moment akin to AI beating a human at Chess or Go. Alas, since contract review is not an adversarial process, no human lawyers were "beaten". A less click-baity headline would be: AI slightly more efficient at issue-spotting contracts than lawyers.
The labor cost savings aren't going to make it to clients. I've worked in a law office, I know how billing goes. Those extra billable hours will be found elsewhere. I hope I'm wrong, and maybe I'm just cynical, but my opinion of lawyers and the legal profession in general took a hit after 3 years of working in it.
You are right. Price of every item has nothing to do with the cost of making it and everything with how much people agree to pay for it.
Driving down the cost of making a thing doesn't lower the price for everyone, but it widens the market downwards serivicing new el-cheapo customer base.
>> It took the lawyers an average of 92 minutes to complete the NDA issue spotting, compared to 26 seconds for the LawGeex AI.
Issue-spotting an NDA is not a typical task for an actual lawyer. It is the sort of thing handled by a legal intern or paralegal... then signed off on by a lawyer. It isn't typical legal work. The results are therefor of limited application in the real world.
Better test: Client asks "Do I need an NDA?" or, conversely, "can I break this NDA I signed last year?". Ask C3PO to handle that question. That is the sort of problem where the real legal expertise happens.
I just joined a company last year that works in this space almost exactly - due diligence contract review - and we are hearing this pretty constantly from people who evaluate our software. Not only is it much faster, but frequently it finds clauses that they had missed themselves.
It's a pretty exciting time to be working in this space.
NDAs tend to be a straightforward type of document with limited scope and a fairly well-known universe of issues. So having a computer program parse the document and itemize issues seems like a good idea.
But what does it mean that the AI “beat” the humans? That the program simply spotted the issues and listed them faster and more completely than the lawyers? Not that impressive a victory. It’s how the issues get resolved that are important.
Did the AI interact with a lawyer on the other side and get issues resolved? Not likely, but the story doesn’t tell us exactly what the test consisted of and how “victory” was determined. (It is possible to download the 40-page report and analyze it, but I am not willing to spend the time to do that, and I bet most commenters, like me, are just responding to the headline take-away.)
While AI can be a great tool, one of the problems with it is that often no one knows how the program makes decisions. Not knowing what you don’t know can present serious blind spots. For example, it may be possible for a counter-party to a transaction who has access to the same AI as you to construct a document with text containing an issue that the AI won’t spot but that the counter-party planted in the document for his or her advantage. If the document is reviewed only by AI (and given a cursory review by a bored low-paid worker who expects AI to catch all the issues), then there is an open back door to your legal castle.
Computers haven’t put accountants out of business, and they won’t put lawyers out of business either. They will make lawyers more efficient, but whether that translates into lower fees remains to be seen.
Your points on "beating" and decision making are very well taken. Same on the resilience of the professions. My own take here is basically that it's accommodating inefficient behavior---a thousand implementations of the same basic deal terms---rather than correcting it. The cure for the common NDA is standardization, which is something the profession can do for itself.
Along those lines, I recently launched an initiative to stop pointless waste on review of routine MNDAs:
The idea was not to write the world's greatest NDA, or to offer whiz-bang features with software, but to create a boring, unsurprising, neutral NDA with a distinctive name that spreads word about itself, creating opportunities to sign routine NDAs without waiting for redundant legal review.
Would love to read your thoughts, here or by e-mail.
I have not carefully read the entire NDA, but I offer the following comment.
If a recipient of information protected by an NDA is a legal entity, such as a corporation, Section 4 of your form requires the recipient to enter into a confidentiality written agreement with each employee (and others working for the recipient) who receive information protected by the NDA. This is both too much and too little!
It is too much because it is burdensome on the recipient to require employees to sign a written agreement every time the corporation receives receive information protected by an NDA. There might be 20 employees who need to see the information, and keeping track of who has signed and who hasn’t and making sure that an employee who has signed doesn’t share information with an employee has not yet signed is an administrative burden.
I don’t ask for this provision when representing the disclosing party, and I would resist this when representing the recipient.
In any event, how does the disclosing party police this requirement?
It is too little because the recipient fulfills its obligation by entering into a written agreement with the employee as required by your form of NDA. If there is a written agreement with the employee and the employee improperly discloses the information protected by the NDA, the recipient points to the written agreement and says, “I did what you asked.” So why would the recipient be liable for the wrongful disclosure by its employee?
To whom is the employee liable if the employee improperly discloses the information protected by the NDA? Presumably the disclosing party would want to sue based on the fact that the employee signed a written agreement agreeing to keep the information confidential, but unless the disclosing party is a third-party beneficiary of the recipient’s written agreement with the employee, the disclosing party has no rights under that agreement.
In the absence of an express statement in the NDA that the recipient’s agreement with the employee is intended for the benefit of the disclosing party (i.e., the disclosing party is a third-party beneficiary of the agreement), it is a litigable issue whether the disclosing party a third-party beneficiary. There is nothing in the NDA form that requires the recipient’s agreement with the employee to contain such a clause.
In some situations, both the disclosing party and the recipient might prefer not to identify the source of the information protected by the NDA.
Even assuming that the written agreement with the employee allows the disclosing party to sue the employee for wrongful disclosure based on that agreement, does the employee have adequate resources to pay a judgment?
Instead of requiring such agreements between a recipient and an employee, it might be more effective to state in the NDA that the recipient is required to instruct its employees on the confidential nature of the information, that the recipient is responsible for any disclosure of information by its employees in violation of the NDA, and that the recipient will be liable for any damages resulting therefrom.
Thanks very much for this comment. I'm glad I looked back on my threads page and saw it!
First, I should make clear that I did not set out to write the very best NDA possible. Rather, I set out to write the NDA that I thought companies and their counsel would find the quickest and easiest to approve. In other words, to reflect current practice, which we might both to agree falls well short of optimum.
Alas, my experience from prior projects is that better terms don't provide enough incentive to standardize. Everybody likes their NDA, and the difference between OK and better isn't compelling. But my hope is that if we standardize otherwise, through CT's self-propagating mechanism, that standard can then become a platform for better terms.
Now to your points on employees and confidentiality.
The covenant to sign NDAs with employees is essentially a commitment to best practice. The parties are confirming that NDAs, or more likely CIIAAs, are part of the hiring packets for both sides. Note the exception for professionals under non-contractual confidentiality obligations, like lawyers. That tracks reality, in my experience.
You are correct that absent express language, and without privity, disclosers could end up without direct claims against breaching employees. That's an absolutely fair point, though I'd hasten to add that the company, rather than its employee, is usually the deep pocket, and an injunction to the company is usually what's needed to stop any bleeding.
The terms addressing employer responsibility are in section 4(m) of version 1.1.0:
> (m) Compliance and Oversight.
>
> (i) Receiving Party shall ensure that its Advisers abide by the confidentiality obligations of Receiving Party under this agreement. If Receiving Party is a legal entity, Receiving Party shall also ensure that its Personnel abide by the confidentiality obligations of Receiving Party under this agreement. Breach of Receiving Party obligations by Receiving Party Personnel or Receiving Party Advisers will be deemed breach of this agreement by Receiving Party itself.
>
> (ii) If Receiving Party is a legal entity, Receiving Party shall provide Disclosing Party copies of confidentiality agreements with Personnel who receive Confidential Information on Disclosing Party request.
Again, thank you very much. Writing what you did took time, I know.
If you'd like to discuss further, please do e-mail me. Otherwise, I can't be sure I'll see it. I'd be more than happy to make time for a call, or arrange a meal, coffee, or libations next I'm down to San Jose from Oakland.
I can imagine system with drag and drop sentence fragments and modifiable variables designed for the construction of contracts. When a document is finished, it would produce a summary of the consequences with as few interpretations as possible, possibly with a toggle for Wikipedia-style keyword linking in the result. The document could then be tweaked until the summary exactly matches what both parties want, at which point the document and summary together become the contract. Although, if such a system were to become widely used, I feel like lawyers will still be used to either discover or introduce any other remotely plausible interpretations that exist in the generated contract.
Agreed! And I'm thinking that some sort of language (or document format with technical markup) is going to become normalized to take advantage of this software, shifting from pure "prose".
Is this technology somewhat akin to a code linter? It automatically finds that problems that would be tedious for humans to find and greatly speeds up the work of the human expert?
Lawyers have traditionally been able to secure their own payout by law, so they ll just thakn you for the extra free time , but will this lead to actual reductions of legal costs?
this is interesting point in time for me....im thinking about becoming a lawyer....im caught between my love for machine learning and deep learning and the desire to practice law.
You just need collusion between law firms i.e. to write a program, and then agree, that whatever it interprets, is the way it will be semantically enforced in court.
To be clear: the study of law is bullshit; so why not take advantage of it, and simply agree, that computer generated bullshit, is what determines it...
... of course while still retaining high rates and billable hours for "attorney review" (for billable hours/padding).
51-156 minutes is crazy to review an NDA. If an NDA is well drafted, I can do it in about 10 minutes. If it's a bit of a mess, maybe 30 min. If it's worse than that, I can assess that in about 5 minutes and propose using a better form.
In other words, I don't think lawyers are in danger. But law clerks? Junior staff? The people who are usually forced to do all the grunt work to allow the top lawyers to focus on their strengths? Those jobs are at definitely on the chopping block. There's still an insane amount of rote repetitive work in your standard law firm.