Legalweek: Is the hype around ChatGPT just a bubble?

Anyone who had the opportunity to attend Legalweek last week in New York City might almost have gotten that impression.

That is not to say that the importance of artificial intelligence for the legal industry has been denied in general. Its relevance to the vast field of discovery, for example, is well seen. The undisputed capabilities of the latest language models when it comes to summarizing documents are also presented as highly forward-looking. Only when it comes to writing legal texts, even as a first draft, have I perceived icy rejection. Why is that?

Usually, after all, it is not the "one" cause that is decisive when forming an opinion. The most common argument I heard was hallucinations. It may be that this topic is even more prominent when a software suddenly invents precedents that don't even exist. The argument that in fact no time is saved if every concept for a brief has to be checked in detail - just like today - also sounds quite factual. The fact that the data status of ChatGPT-4 is September 2021 certainly does not build confidence, even if interfaces for updating were announced recently. And in the end, the sentence "Lawyers hate change", delivered in front of a large auditorium, remained unchallenged there.

So it will be a mix of several motives if no hype about ChatGPT & Co. could be detected with regard to lawyer’s "writing".

Does this mean that the future of the legal industry will not be (radically) changed by Large Language Models after all? I don't think it does, but change takes time on the part of those affected - and unimpeachable quality on the provider side. And it needs participation: without training a model with its own content (data), it will not be possible to ensure the necessary quality, and that costs time and money.

GPT in general and the legal industry in particular: Report from an interesting roundtable.

Yesterday at noon (local time), a roundtable on "Beyond ChatGPT: What Generative AI Actually Means for Law Firms, In-House, Legal Tech and More" was held in the US. Legaltech News Editor-in-Chief Stephanie Wilkins welcomed an illustrious crowd of guests.

Without a doubt, the surprise hit came from Pablo Arredondo, Co-Founder and CIO of Casetext. Not only did he announce the simultaneous live launch of GPT-4, but also of "CoCounsel", an application from Casetext that already relies on OpenAI's brand new language model. He raved about the new GPT version, predicting that it would be simply impossible for law firms not to use the new technology because it was so much better than humans (!) To be fair, he added that he had analyzed his own litigation files with CoCounsel, which alerted him to highly personal errors and gaps in reasoning.

Casey Flaherty, Co-Founder and Chief Strategy Officer of LexFusion, initially tried to put things into perspective: GPT is ultimately just one of many available language models that has the hype on its side. However, he also emphasized that the threshold to market maturity had been overcome; if ChatGPT was the trailer, the movies would now follow. His advice: "This is happening now; it will be done by you or to you." 

It was also exciting to hear that Flaherty, unlike the other panelists, very much expects technology to partially replace lawyers.

Darth Vaughn, Litigation Counsel and Legal Innovation and Technology Operations Manager at Ford Motor Company, took a different view: he, too, is excited about new technology, but stressed that at all times domain knowledge must remain available in the organization to control the new tools.

A large indirect impact on advocacy was seen by Jae Um, Founder and Executive Director at Six Parsecs. She, too, sees LargeLanguageModels as indispensable in law firm practice. However, she emphasizes that the use of ultra-fast high technology means the end of traditional billing based on time and material. The law firms are urgently required to try out alternative remuneration models, whereby it will probably come down to trial&error.

In summary, a common ground can be found in the fact that from the point of view of US commercial law firms and providers, the use of state-of-the-art technology is indispensable. Which language models will ultimately prevail cannot yet be judged. I have not heard of any reservations about training models of foreign providers with own law firm content (=client data). And whether this constraint is transferable 1:1 to the continental European market with its completely different legal system could not be addressed in this intra-American format.

ChatGPT and Academia - a tense relationship

After the first two days of the IRI§23 conference were primarily about practical usability, as far as the respective streams were related to ChatGPT, the focus on Saturday was on academic topics.

The first was the question of the protectability of language models and their results under copyright law. The answer to the latter is probably complex enough, there would have been no real need for the appeal for a general abolition of copyright in the field of science.

Highly interesting, however, were the reflections on the subject of teaching and on the subject of citation. With regard to teaching, the thesis was put forward without contradiction that the age of "academic homework" is finally over. No teacher can be expected to take responsibility for assignments that are actually written by highly developed chatbots.

And the scientific citation, is it also endangered? - I mean, yes certainly. How should a citation be composed if the result is not repeatable? After all, here there are massive differences in the new technologies compared to the common practice of citing web pages with an exact date of retrieval. But I also wonder if the question is really that prominent. Will there be legions of scientists using ChatGPT to write their papers? If so, then only in marginal areas, and there a copy&paste from Wikipedia should be sufficient. With appropriate reference.

Conclusion: Some questions can be solved, others only in the more distant future. It may be discussed further on academic ground.

ChatGPT - Revolution or bubble?

At "IRI§23", the International Legal Informatics Symposium in Salzburg, ChatGPT was the star. The deserving organizers had not quite expected this, but the number of visitors to the corresponding streams was high.

But what exactly is so special about this new technology?

• The ability to correctly interp'ret human language, say some.
• The ability to even write texts in a flawless form, the others.
• ChatGPT revolutionizes database searching, according to some; or not.
• It is a system that should be used only by experts because of its error-proneness - or, according to another opinion, only by non-professionals.

And so it went on, and every opinion was well-founded! There was even disagreement on the question of whether ChatGPT would tsunami-like overrun the legal world or whether it was just a risky bubble.

At least concerning the last question I have a clear opinion: ChatGPT (and the epigones) are too big to fail. The billion dollar investment leaves no other development. And after all, never in history has a new technology found so many users so quickly.

Conversational AI is making history, but no one knows exactly what form it will take.

Allowed to be wrong sometimes

For years now, the question has been discussed again and again in relevant formats whether lawyers will need programming skills in the future. I have always denied this - to acquire and maintain good legal knowledge is enough to fill an evening, there is no room for another discipline (apart from exceptions).

Today I say: that was too short-sighted. Just as marketing professionals need to have a deep understanding of the processes around digital advertising, lawyers of the future need to have a good understanding of the relevant digital technologies.

They don't have to be the ones writing lines of code for e-discovery suites. But they do need to be able to assess what to expect from the various technologies that are usually grouped under the umbrella term "artificial intelligence." Lawyers and notaries, corporate lawyers, judges, prosecutors and administrative lawyers - all of them will, in the course of their very own work, be facing the question of the use of technology for certain process or procedural steps and will have to assess for themselves what they can expect from it and what the risks are. By this I don't mean the eternal data protection issues, but issues such as bias, training sets, confidentiality, and most especially error calculus.

This also creates a whole new set of challenges for legal academia, but even more so for continuing legal education. For a long time, lawyers have seen time constraints as their central problem. The tension will only be resolved if ... but that is another story.

Catch-up

Recently, I was honored to be jury member at the Global Legal Hackathon. Given the dimension, there are of course quite a few jury teams, but "mine" is worth a second look. And that's how it came up::

Even a glance shows a highly interesting mix of jury members: geographically, the spectrum of members ranges from South Africa to the Baltics, from Romania to the British Isles. Every single one of them has an independent, individual career - practicing lawyers are represented as well as professional startup consultants, for example. But one thing gives me pause for thought:

Is it pure coincidence that the (originally) German-speaking members of our jury team are all male, but all the others are female??? Or is there perhaps a massive #backlog in #diversity in Germany/Austria?

Postscript: this thought is not a hidden critique of the configuration of the jury team - rather, it is a direct consequence of an intense discussion I had with my wife on the topic yesterday; as a doctor in hospital, she has long been used to diverse teams.

The darker side of digitization

Last week, New York City hosted this year's LegalWeek - an annual, multi-day congress on the digitization of the legal industry. After two years of absence due to the pandemic, many sessions revolved around the question of what impact COVID-19 has had on digital development. This question is as difficult to answer after the pandemic as the prophecies in this regard were before. I would like to share two interesting aspects from the event reports here.

First, in his article published on law.com, Rhy Dipshan argues that the demands on judges are increasing as the use of technology in the courts increases. The panel was not at all concerned with fancy understanding of the mechanisms of artificial intelligence. Rather, the focus is on ostensibly trivial mechanisms such as the questioning of witnesses via video call (zoom, etc.). Judges should pay more attention to the setting and the possibilities it offers to parties and party representatives.

Concern was caused by the thesis that the  digitization of the judiciary does not actually improve access to justice, but rather restricts it. Often, it is a matter of simple things like access to basic technology. There was mention of a family court that had entered into a cooperation with a local church, where litigants were given access to the Internet in digital kiosks in the first place. This would be a surprising symbiosis of state and church, which is worth reflecting on further - which brings us back to Lent.

Lent

A week ago, Catholics began this year's Lent. It lasts 40 days, but only because they do not count Sundays; in reality, it is 6 ½ weeks. Today, Lent is mainly equated with abstaining from alcohol, nicotine and fatty foods. In truth, however, it is a time for reflection and inner contemplation. Even if the current geopolitical situation with Russia's war of aggression against Ukraine is not suitable for finding inner peace, I would like to briefly apply the idea of renewal to the legal profession and its tools.

One mantra of legal digitization is as follows: Law firms should standardize their processes for reasons of cost reduction and quality assurance and make use of commercial tools ("LegalTech").As a result, the same texts would then be used by many law firms for frequently occurring processes, and at a lower cost accordingly.

After a bit of introspection, however, one could also say: from a third party's point of view, this may be desirable and sensible, but is it enforceable? Obviously, there are major hurdles, otherwise the numerous systems on the market would already have become more widespread. This need not come as a surprise, because which company will agree to changes that make its own market performance interchangeable without massive pressure? Certainly, it is then argued that it is not about "bespoke lawyering", but about the surrounding - but what if the surrounding earns the greater part of the rent in one or the other law firm?

One need not be surprised that the various text generators and clause managers are primarily found in the legal departments: there are similar cases there in high frequency, and the legal departments are not in competition with each other.

08:30 am

At 23:00 CET, Russian television broadcasts President Putin's declaration of war on Ukraine. NATO's reaction: it tries to convene an emergency meeting for 08:30 the next day.

One can easily imagine Vladimir Putin trembling before this reaction. But that is not the topic here, rather the question, what connection does this geopolitical process have with LegalTech and the development of democratic legal systems?

Quite simply, even in 2022 the fast eat the slow. And even if there is no public discourse about it, there are parallel processes. For example, the enforcement of small claims, which have largely migrated from the courts to dispute resolution systems such as Ebay. Does anyone wonder if this abandonment of state authority is actually desirable? No, we are drowning in ethical discussions about blockchain, even though it has the potential to further erode the democratically legitimized rule of law.

Deluded warlords and technological developments have surprising things in common: Those who usurp the law of action have a clear advantage. Contemporary democratic structures tend to be at a disadvantage.

Mandatory vaccination as a prototype for digital legislation?

Recently, I reflected here on possibilities to (partially) automate the legal system by using machine-readable language. As chance would have it, just in these days the current work of a Viennese doctoral student of law became known, who has set an initiative in this direction:

Since the beginning of February, the so-called "vaccination obligation" against COVID-19 has been in effect in Austria. But what does "in effect" mean. The associated law and the implementing ordinance issued on the basis of the law comprise a total of 35 paragraphs with countless subdivisions (paragraph, numbers) - not a text from which one can see at a glance how a particular circumstance is to be classified.

On his Website impfpflichterfüllt.at Paul Eberstaller leads the questioners with few, simple questions by the topic and offers at the end a clear answer: the inoculation status is valid or not valid. According to his own information, he needed only four hours for the development.

And now I wonder: compulsory vaccination is one of the most hotly debated topics in Austria because it deeply interferes with people's right to self-determination. If it is possible, even in this highly sensitive area, to formulate legal regulations so clearly that specific facts can be measured against them mechanically - why does this exception not become the rule? This would serve everyone!

About the child and the bath

Since it recently became known how great the influence of politics is on the appointment of top judges (and all top administrative posts) in Austria, the Republic has outdone itself in cries of horror and suggestions for improvement.

The undermining of the separation of powers through massive party-political influence on the appointment of higher-ranking judges is, of course, to be condemned. Nevertheless, the general outrage is unjustified. This system has existed at least since the Second World War; it is even partly stipulated in the constitution. What is new, at most, is that "evidence" is on the table for the first time. In any case, many of those who are raising their voices today have themselves come to their top function in precisely this way. Presumably, they are also too young to still remember the clarification of the AKH scandal.

It is also exciting that only coalition parties and members of the federal government are ever mentioned. Yet it is precisely the Federal President who, as an elected politician, has the last word according to the B-VG - and highly respected former Federal Presidents knew how to make extensive use of this possibility by a simple trick: they perfected the art of not signing.

So now, according to one proposal, judges and prosecutors should only be able to be appointed by judicial nomination during their entire career path. At first glance, this sounds tempting, but it overlooks two key facts:

First, judges are human beings, too, and thus not free of political persuasion. Influence, which will certainly continue to be desired by politicians, then shifts to another level.

Secondly, with all due respect and completely disregarding the specific individuals currently acting, the following should also be considered: Systems, which complete themselves exclusively from themselves, tend generally to petrification. Not every passing over of a line-up proposal has to be politically motivated, there can also be solid reasons for it. In any case, quite abstractly, and again emphasized, without looking at any concrete persons, it cannot be assumed that change agents make it into those positions in the judiciary and the administration of justice that enable them to have such an effect even if the "system" itself decides on its supplementation.

So much for the cause and for the sake of the cause. There are certainly ways to unite both goals in a meaningful and objective way.

Justice as a gamechanger

Today I was interviewed by the agile Nerds of Law Katharina Bisset und Michael Lanzinger for their podcast. As often, the question was, will legal tech become more widespread? What will that mean for the legal profession?

For the most part, there are fairly balancing answers to that question. For once, I'd like to spin a polarizing thought:

"The gamechanger" par excellence in Austria was the justice system. It began deep in the 20th century with the introduction of the form-based dunning action and the digitization of the land register, and a little later the company register. Mandatory electronic legal transactions with the courts gave Austria a decades-long head start. What if the justice system were once again the driving force, and what might that look like?

A thought experiment: laws would be written in machine-readable German, i.e., with clear logical relationships and well-defined terms. There would even be room for discretionary leeway, but we would have to dispense with undefined legal terms and systematic loopholes. The jurisprudence of all courts would be analyzed in depth by machine and connected to the new laws by means of connectors. THAT would be a game changer, but one that would not please many of those involved in the legal system (lawyers, judges, even experts), because many court proceedings could be automated or simply eliminated.

Is the idea absurd? No, research on legal language is plentiful. The bigger issue would certainly be the connection of the jurisdiction, but at least it would not fail today because of the computing power.

Not to be misunderstood: This is not a proposal, but a thought experiment. But the underlying thesis is a fact: Digitization in Austria runs through the justice system!

Digitization of the judiciary: Now!

In Austria, an obligation to be vaccinated against COVID-19 is to be stipulated by law. Needless to say, this plan is polarizing opinion. Recently, the professional association of judges and public prosecutors expressed its position on this issue. In addition to constitutional concerns, the issue is the immense additional burden on the courts resulting from the expected appeals against penal decisions. There is talk of a 6-digit number of additional proceedings "threatening" the administrative courts and supreme courts. 

The concern is certainly justified. One does not have to be a prophet to foresee that this wave of complaints will be steered on the one hand by certain political parties, but also by the legal profession. And there the question of resources does not arise? No, because these complaints will certainly be handled with a high level of technological support. Just as in the case of flight delays or fines for speeding.

These resources must also be available to the authorities! The cases will resemble each other or can be typified, the arguments will be repeated. If lawyers manage to build up the necessary infrastructure - why should the judiciary not be able to do so?

It is certainly not a financial question. Probably a legal one, but the lawyers on the other side are also obliged to personally authorize each and every appeal, and the relevant case law of the Administrative Court is well known. But of course, it also requires the willingness of judges (and politicians) to accept technological support. If compulsory vaccination actually becomes law, typical mass proceedings must be expected. The timing for a digitization push in the judiciary could not be better.

The power of money

Austrian industry magazine Horizont recently reported on the unexpected economic success of news service Substack in the US. After a slow start in 2017, the scale recently rose to more than 1 million paid subscriptions.

Paid newsletter subscriptions??

The business concept is amazing: Substack collects the best and most prominent authors by offering them 2 advantages over the traditional media world: 1. no content control by publishers, editor-in-chief or the like, and 2. a 90% share of the revenue generated.

The business concept could be transferred easily also to legal contents: one looks for the most prominent, shrillest specialists and offers to them a weekly column against absolute maximum fee. The authors take over the marketing through their mere availability.

The catch: the business concept inevitably leads to exaggeration and selective reporting. - In the past, this would have been called puffery. Now, I am not an enemy of the boulevard; it rightly has its place in the media world. But specialist information for experts must remain objective and predictable.

USA: COVID-19 does not increase cloud usage among lawyers

An interesting article on law.com recently addressed the question of whether the pandemic has led to increased use of cloud technology among lawers. A survey by the American Bar Association of several hundred members from law firms of all sizes paints rather the opposite picture. A fairly stable 40% of American lawyers continued to reject cloud technology.

The reasons given are not new. On the one hand, there is the cost risk involved in a transition from on-premise to cloud during the changeover phase.  More important, however, are security concerns. These can be roughly divided into two categories. One set of concerns is factually based. The fear that cloud providers could install spy software under pressure from public authorities and thus gain access to confidential information is usually cited. These reservations probably cannot be definitively dispelled for the USA.

It is more difficult to deal with dogma, such as the following. "Data storage in the cloud carries a higher security risk than on premise." Once you internalize this, it will be hard to convince you otherwise. So ultimately, it will be the clients who motivate their advocates to use contemporary technology. Or everything will remain as it is.

Parallels to current discussions are coincidental, but not necessarily wrong.

Digitization of the judiciary?

The highly esteemed Markus Hartung quotes the German Federal Bar Association on Twitter: "BRAK has already made a decisive contribution to this process [i.e. to the digitization] by setting up and operating the (... beA)". He leaves the quote uncommented - but I would like to take it up briefly:

In wide legal circles, the opinion still prevails that the use of word processing and e-mail as well as the use of legal databases is already "the" digitization. If one assumes this, the establishment and operation of a secure document transmission system is undoubtedly a step forward. But it is also only a beginning.

A further digitization of court proceedings will inevitably affect established principles. The immediacy of proceedings, for example, the decision by judges as persons at every stage of the proceedings, the performance-based remuneration of lawyers, and - yes, even the new idol called data protection. None of this will happen today or tomorrow, and of course it will require constitutional amendments - but digitization is more than just remote access to files, even if much has already been gained with the latter.

Frankfurt Boookfair and digitization. A surprising connex

I have been visiting the Frankfurt Book Fair for 35 years. For reasons of cost (hotel prices at fair times are astronomical there), we usually sought out accommodations that were located outside. I have fond memories of a hotel in Hanau, for example. Hanau is a neighboring city of Frankfurt, and the public connections to the Main metropolis were good even then. But ...

But the trade show program also included attending evening events, which had to end with a cab ride back to the hotel. And here the horror began, not out of fear, but because the cab drivers regularly didn't have the slightest knowledge of the area as soon as they passed the Frankfurt city limits. Erroneous journeys, unsuccessful inquiries with colleagues - the journey home was always an odyssey.

Why do I remember this? Because these days the CEO of Uber Austria demanded that the test of local knowledge for obtaining the driving authorization should be dropped without replacement; it was obsolete in times of digitization (note: for rental car drivers like those of Uber, this obligation was only recently introduced in Austria). Is it?

I wrestled with myself for a while, but I think the man is right. Surely it's not a mistake for cab drivers to have some local knowledge. After all, systems can break down once in a while. But we live in the age of digitization, and it's more important to me that the driver drives properly and perhaps also speaks the local language. In truth, I don't care whether he follows his knowledge or a digital helper on the way to Hanau.

Perhaps the following will get around to the representatives of the cab industry: If you're late, life punishes you.

The Oxymoron in Legaltech

In the context of the anniversary event of the German EDV-Gerichtstag - I reported - a judge had raised the postulate of scalability, but at the same time human control, in connection with the machine anonymization of court decisions. An exceptionally educated, highly esteemed colleague spoke privately of an "oxymoron" in connection with this. Is he right and are oxymora perhaps even generic characteristics of legaltech?

If one follows the various dictionaries of terms, oxymora are combinations of contradictory words or terms to or within a statement. This probably applies to the example cited at the beginning, because automation and human control run counter to each other. But are there other examples?

In a recently published survey by a major professional information provider, there were quite a some clues: For example, the respondents rated collaboration with clients highly, but at the same time considered communication by phone and e-mail to be indispensable. Or the cost-effective automation of office processes is desired, while at the same time the continued use of the law firm's own forms and formats is postulated.

I don't know if these are oxymora in the strictest sense of the word. Most importantly, I wonder if those who express these contrary desires are even aware of this fact. If the answer was no, it shouldn't be surprising. The buzzword bingo in legaltech in its monthly variations of terms is not to be outdone. What non-specialist is supposed to keep track of it all? And the feeble query "What importance do you attach to AI. in the future?" is already confusing in its generality. The appeal to legaltech providers can therefore only be to present clearly defined products in equally clear language and not to keep changing the vocabulary.

Otherwise, the legaltech providers themselves are the oxymoron.

"The 'robojudge' is technologically impossible."

With this clear statement, the Executive Director of the Center for Legal Technology and Data Science at Bucerius Law School in Hamburg, Dirk Hartung, tried to direct the discussions about the digitalization of law into more realistic channels.  "We tend to be concerned with the social impact of technologies, the use of which is far beyond any meaningful period of consideration," Hartung said.

The occasion for his lecture was the 30th EDV-Gerichtstag (EDP Court Day), which for well-known reasons was again held virtually rather than in Saarbücken.  Prior to this, Florian Matthes, professor of computer science at the Technical University of Munich, had given a highly interesting talk in which he screened the main technologies that are currently shaping the development of legal informatics. Matthes did not hesitate to address controversial topics. When he describes Natural Language Processing (NLP) for legal texts as an essential field of research, hardly anyone will disagree with him; his appeal to rely (again) more on rule-based expert systems, on the other hand, is likely to meet with headwind.

The topic of NLP also reveals a topic that ran through the entire event. One might agree that "computer scientists and lawyers must become friends" (Maximilian Herberger) if one is concerned about the digitalization of law. However, the very mention of "understanding" legal texts as a link between the processing of existing texts and the generation of new ones triggers fundamentally different associations in lawyers and technicians: the linguistic-logical understanding of a legal issue literally collides with the mathematical approximation analysis that is meant by "understanding" from a technical point of view.

Also of direct interest to Austria is the issue of anonymizing court decisions as a prerequisite for their publication. Work on automating this labor-intensive process has been going on for some time in both Germany and Austria. It is interesting to note a thesis of the judge Isabelle Biallaß: Anonymization not only has to be humanly controlled, it also has to be scaled, depending on whether the anonymized text is to be made available to science or industry.

That could still take some time.

Legal publishing house may offer contract generator - no violation of legal services law

WoltersKluwer offers a so-called contract generator in Germany under the "smartlaw" brand. The Hanseatic Bar Association in Hamburg filed a lawsuit against this with reference to the Legal Services Act and won at first level. However, the German Federal Supreme Court (BGH) has now confirmed the amending judgment of the Cologne Higher Regional Court (I ZR 113/20 - Contract Document Generator).

In detail, the BGH stated that the creation of a draft contract with the help of the digital legal document generator is not an unfair act according to § 3a UWG because it does not represent an unauthorized legal service within the meaning of § 2 para. 1, § 3 of the Legal Services Act (dRDG). The defendant's activity consists of creating contractual documents on the basis of the user's specifications with the help of the software programmed and made available on the Internet. In doing so, it does not act in a specific matter of the user. It had programmed the software on the basis of thinkable typical factual constellations, for which it had developed standardized contract clauses in anticipation of the given answers. The user's individual circumstances, which go beyond the usual case, would not be taken into account in the creation of the contract document - similar to a form book. Therefore, the user does not expect a legal examination of his specific case.

The German bar association is conducting a whole series of lawsuits against providers of LegalTech applications; so far, they have mostly ended in favor of the providers. However, it should be noted in each case that the German legal situation has no direct equivalent in Austria.