#30 AI Reality Sets in for BigLaw

Aug 14, 2024

This week, I share an article about BigLaw firms’ reality check with AI.

AI will change the world, but how will it change M&A? I want to focus on AI’s impact on M&A in this newsletter. I am not an expert on either M&A or AI, but I want to learn about both topics and how they intersect. I thought there might be others in my situation (or people who are experts in one field or the other) who would find information on M&A and AI helpful in their careers, so I created this newsletter to track and share what I learn.

BigLaw AI Let Down

A sad, disappointed older cartoon lawyer and a female cartoon lawyer standing side by side. The older male lawyer has a slightly smaller head, graying hair, wrinkles, and a more realistic appearance while retaining some cartoonish elements. He is dressed in a traditional suit, with a tie and a briefcase loosely hanging by his side, with a downcast expression. The female lawyer is also in a professional suit, with a similarly somber expression, and is holding a briefcase. The background is simple, with muted tones like gray or blue, emphasizing the somber mood. The overall style blends realism with cartoonish features.

Here is an article from Bloomberg Law about the recent disillusionment with AI in Big Law. I want to provide some takeaways for ways to move forward based on the article and current state of AI.

AI Is Not an Electronic Lawyer

The article’s main point can be summarized by the following: Lawyers discovered that current AI Is not an electronic lawyer. When the AI hype began with the release of Chat-GPT, I think many people believed that AI would soon replace all white-collar workers. I was one of those people at the beginning, which is part of the reason I started this Substack.

My thoughts on AI soon shifted, however, after a month or so of research about the available tools. I soon realized, as I have documented here, that AI is good at somethings (creativity) and bad at others (being accurate when words matter). I think the rest of the legal world has caught on to my realization. Today’s AI tools are good—they do things that were unimaginable just a few years ago. They are not (yet?) replacements for people and human expertise.

Redlining Tools

The article mentions the drastic change in junior associate’s daily life after redlining tools appeared on the scene a few decades ago. Once upon a time, associates were tasked with analyzing the differences between drafts by hand. This would have taken a significant amount of time. Now, there are special programs that “redline” documents in seconds.

I had not thought about redlining tools as a world-altering shift in lawyers’ lives, but with only a few seconds of thought, I think it becomes clear how big of a change redlining technology was in M&A practice! Imagine an associate marking up every change in a document by hand!

I think AI presents a similar change but with more widespread use cases. Like redlining technology, AI will cause junior lawyers to become more efficient in their jobs, opening up time for more substantive tasks. To my knowledge, redlining technology did not eliminate associate jobs, it just changed them. I think AI will do the same—change, but not eliminate jobs. The key to all of this is finding the correct uses for AI because unlike redlining, there is not a narrow, automatically defined use case for AI in law. We have talked about this before.

The Hype Cycle

The article, combined with the recent Bain study, makes me think of the hype cycle of technology.

The hype cycle describes the cycle that new technology goes through. Here is a graph showing the cycle:

In my opinion, the introduction of ChatGPT and the ensuing excitement represented the "Peak of Inflated Expectations.” Now, I think we have begun the downslope toward the “Trough of Disillusionment” because people started to realize that current AI is not what it was hyped up to be a few months ago. This is not a bad thing. In fact, in the typical case, it is during the Trough of Disillusionment phase that the most viable use cases for new technology are found, and I think this applies to AI. When and if AI moves into the trough of disillusionment, I think it is important to focus on more narrow and impactful uses for AI. For example, my signature page generator is a simple yet effective application of AI that could save some lawyers a few minutes when creating signature pages. Such a narrow application of AI will not change the world, but if we multiply many narrow use cases for AI together, the outcome will be great!

Zoom Docs

Zoom recently upgraded its AI offering with the addition of AI-integrated Zoom Docs.

Here is some information on its capabilities from the press release:

Zoom Docs’ AI-first capabilities help Zoom Workplace users make teamwork more collaborative and effective, optimize productivity by keeping information organized, and reduce silos by empowering teams to communicate and share information more fluidly.
Turn AI Companion meeting summaries into easily editable docs, freeing up time spent on note-taking and manually copying notes into a shared document with templates for one-on-ones, stand-up meetings, brainstorming, project updates, discussions, Q&As, customer success, user feedback, and more.
Generate content based on AI Companion meeting transcripts. Use custom or preset commands or queries with AI Companion to further create and revise content.
Revise and summarize content such as articles, plans, and outlines, change tone and style, catch grammatical and spelling errors, and translate content into nine languages (with support for additional languages planned) for multilingual teams with AI Companion.

Zoom had already released AI features, including the ability to “chat” and create action items based on the transcript of a meeting. These features were useful for junior M&A lawyers because they made note-taking much easier. After all, the associate could essentially rewind the meeting by chatting with the transcript about what was said.

The newest features make note-taking even more convenient for junior associates by generating notes on a separate, editable document. I don’t think this is life-changing, but it is a good feature that could save some time for Zoom users.

About me

My name is Parker Lawter, and I am a law student pursuing a career as an M&A lawyer. I am in my last semester of law school, and with some extra time on my hands, I decided to create this newsletter. I hope it is informative and helpful to anyone who reads it! I am not an expert at either M&A or AI, but I am actively pursuing knowledge in both areas, and this newsletter is a part of that pursuit. I hope you’ll join me!

Follow me on LinkedIn: www.linkedin.com/in/parker-w-lawter-58a6a41b

All views expressed are my own!