Daniel Martin Katz – a jogi innováció úttörője

Október 17-én Budapestre látogatott Prof. Daniel Katz, a jogi innováció egyik világszinten legelismertebb szakértője, hogy az OPL Attorneys éves eseményén tartson előadást több mint százhúsz ember előtt a jogi innováció legújabb trendjeiről. Az esemény előtt Orbán Miklós, az OPL egyik alapító partnere készített interjút a professzorral. Az interjút változtatás nélkül, eredeti angol nyelven közöljük. Az illusztráció gyanánt használt képek a fent említett eseményen készültek. 

Why did you choose to become a lawyer, and when was the first time you were interested in legal innovation? Did you have a transformative moment?

I saw that lawyers have a lot of authority in society and the public discourse is reflected in the law, and that interested me.

In law school I thought the law does not work the way the rest of the world does – and in a bad way. People would say that the law is not quantifiable but rather only about weighing value judgements. I thought this was not in line with the way the rest of the world works. This is why I did graduate studies outside of the law to obtain the technical skills needed to help bring modernisation to the field of law. I’ve since seen that this kind of modernisation is needed in all of the jurisdictions I’ve visited!

When you were in law school, did you learn anything about legal tech or innovation in law?

No. I graduated 13-14 years ago. At that time the internet was not so advanced and people could not yet anticipate the ways in which the internet, tech or innovation would influence the law and legal practice.

Law firm models were built on the law being predictable, steady and static. This is no longer the case – law now changes rapidly, not only in substance but in volume and complexity as well. How do you think this trend affects the legal world and the role of the lawyers?

If lawyers want to solve the problems of the world and make government systems work, they will need to become multi-disciplinary in terms of being able to implement legal rules into systems whether they are human-centred systems or technical systems.

There have been academic efforts to measure the impact of legal rules, but generally those people who create laws are not necessarily focused on government systems and how the laws are implemented.  There is increasing complexity in law, but the real question is whether we can scale technology to deal with the increasing complexity. If we can, then we can build systems to scale no matter how complex the law becomes.

20-30 years ago, the stereotypical business lawyer was a negotiating lawyer and now it is a compliance lawyer. The focus has become ticking boxes as to whether you have complied or not rather than negotiating terms. Do you agree?

I am not sure. There are more rules now and the economy is a lot more complex and global. Globalisation and the increasing complexity of the economy both cause the increasing complexity of the law. That is not a problem if we can scale implementation and other systems to match the law’s complexity. We’ve been able to scale up complexity in other areas – computing systems have become far more complex but we have developed innovations such as user interfaces as a way people to mediate or deal with the computer system’s complexity.  We need something similar for law.

Is there a transformation taking place in the legal industry and if so, what is the principal driver for this change?

There is no single driver. We talk about “robot lawyers”, but actually there are several factors that contribute to overall change that could be called a transformation. Customers and clients are getting more sophisticated in their use of lawyers, especially the large enterprise clients. Legal procurement is changing – companies now often spend more money on hiring lawyers inside the company rather than using outside lawyers. They also take advantage of the growing market for outsourced legal services. Lawyers in all fields are focusing on possibilities of replacing legal staff with technological products or processes. It is the sum of all these changes that is disruptive.

People fear that robots will replace lawyers. With that in mind, what edge do lawyers have over machines?

Machines can’t create the kind of technical systems needed – only people can.

On the other hand, I don’t think the blanket statement that people always prefer face-to-face interactions is true anymore. There are a lot of millennials that would rather use computers than talk to a person on the phone. There may be some situations in which direct interpersonal interactions are best, but it is no longer true for every situation, especially as technology becomes increasingly sophisticated, enabling service delivery via chatboxes and even avatars.

One of the biggest changes afoot is in companies’ procurement of legal services. How do you see this change playing out?

There is a cushy relationship between the people who work as law firm lawyers then go in-house and their former colleagues from whom they then buy the same services that they themselves were once offering. This practice has become so ingrained that it takes someone from the outside to look at it critically and ask whether this is really represents best practice and best value for money.

Do you think legal tech is the driving force for legal development? The “wonder drug” that will cure all that ails in law?

I wouldn’t call it a “wonder drug”, but it has a critical role to play. Legal tech evolution can help us move law to a more product-based business offering products or product-and-service bundles and away from what currently exists everywhere in the world – the laws, cultures, and jurisdictions may be different, but everywhere law is a business selling subject-matter expertise by the hour. Legal tech is critical to changing this model.

People expect too much from Artificial Intelligence (“AI”) – do you think there will be an AI winter again?

Yes, I think there has to be some sort of winter because I don’t see the possibility of AI delivering on the promises being made. The problem is that companies that sell AI products are incentivised to oversell AI’s capabilities, thus building a hype that we can’t yet match in reality.

Sometimes legal tech seems to be playing catch-up, merely adapting to changes in the market, and most of the innovations are not designed to solve laws’ biggest problems, such as access to justice.

It is true that we have not done a good job of scaling the law down to cost effectively deliver legal products and services that work for those in the retail market. The legal profession tends to focus on complexity and we are too often not able to deliver simple situations or applications. Access to justice is often a business model problem and a cultural problem because lawyers are incentivised to sell the most complex and tailor-made solutions to what may be only a simple and commonplace problem that could be resolved by a simple and commonplace (and inexpensive) solution. Lawyers have to stop thinking that every problem is unique, complex, and intricate and start looking for ways to scale services to better meet access to justice gaps. Legal tech can play a valuable role in this scaling.

What would you want from the justice system by 2030?

Scaling up solutions to better fill gaps in access to justice. There are great models for this in adjacent market segments such as FinTech. There are examples in law, but they are still too limited. I don’t think it’s practical for government to fund this area – I’m looking for market-based solutions.

Market place demands on law graduates’ competences are staggering. What do you think law schools should teach more of?

Law schools should teach students to be more well-rounded professionals and create 21st-century T-shaped lawyers – the middle part of the T is fundamentally required subject-matter expertise, and the T’s crossbar represents varied and complementary competencies. For example, business lawyers need to know not only about business law but also how businesses operate and some finance and accounting. The problem is that law school currently only equips students to deploy subject-matter expertise and all the crossbar competencies are left to be picked up on the job.

According to the founder of Do Not Pay, unless you are in front of the Supreme Court for murder, you should not be paying for legal services. This should be available for free of charge and it should really be easy and supported by an application. What are your thoughts on this?

I think there is more to it than that. I don’t believe it should be free because things that people receive for free tend to be unvalued and potentially poorer quality. I think legal services should be cheaper and more cost effective. This will add more value to every dollar or euro or forint you have invested.

How do you see the legal market in 10-20 years from now? Do you see the death of BigLaw?

Big law firms will adapt to the changes, changing their own ranges of products and services. Accounting firms and other smaller and new players will play a role too with different approaches. Same players will stay in the market with different strategies. I don’t see a death of BigLaw, but I do foresee continued and continual change.

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