Toronto-based lawyer and tech entrepreneur Monica Goyal explains why innovation appears to come slow in the legal profession.

 By Monica Goyal

This past weekend, I was a panelist on “Legal Techs in a Brave New World” at lawTechCamp (hosted by the University of Toronto, Centre for Innovation, Law and Policy).  My co-panelists were Michael Carabash, an Ontario lawyer and founder of Dynamic Lawyers, and Terry Taoussanopoulos from Brooks Barristers & Solicitors, a lawyer and founder of a legal referral site.  Jordan Dolgin, a lawyer active in the Toronto start-up community, chaired the panel. The discussion focused on the challenges that legal tech startups face, why innovation will be slow to come to the legal profession, and on some interesting developments in the legal profession. Here are a few of the points we covered during the discussion.

Law and Technology

Bridging the legal and technological professions is tough.  “Lawyers aren’t naturally good at building websites or computer programming or stuff like that,” writes Michael Carabash on his blog at Dynamic Lawyers, “They come from arts programs (there are only a few with engineering backgrounds).  We take courses like history, political science, and philosophy.  We know how to analyze, research, and write.  But ask us to build a website or a computer program, and most of us will be lost.”  

Michael is touching upon what is probably the single biggest reason why law lags behind other professions when it comes to embracing technology.  There are very few lawyers who can think in both spacesIf you do decide to venture down the startup route, the challenge will be pairing up with the right technology partner who can help you bridge that gap between the two professions.  I suspect we will see more lawyers trying to create technological solutions to legal problems, especially in light of the success of LegalZoom, an American non-lawyer legal document website. 

Unauthorized Practice of Law 

Ever read the disclaimer on a government Website?  Most state that the site offers only information, and that if you need further assistance you should contact a lawyer.  While this may appear odd, it’s actually quite accurate. That’s because only lawyers are licensed to dispense legal advice and assistance. 

Personally, I’m of the position that software solutions are not providing legal advice, but LegalZoom, nevertheless, has been challenged in several states in the United States as engaging in the unauthorized practice of law.  And it has happened that Websites, without the huge resources of LegalZoom, have been forced to shut down because of pressure from local law societies.

Is this push against legal sites legitimate, or do these law societies feel threatened by an alternative to traditional legal practice?

Show Me The Money

Terry Taoussanopoulos from Brooks spoke about the challenges in securing funding from non-lawyers.  The founder of another well-funded legal startup in the Bay Area once told me that it took them five years to secure funding for their business.  Terry eventually did secure funding, but from other lawyers.

And, if you are familiar with Legalzoom and their story then you know that one of its co-founders is Robert Shapiro.  Yes, the same Robert Sharpiro who served on OJ Simpson’s defence team. He was LegalZoom’s first investor.  But is it really surprising that these early angel investors are lawyers?  Who better to fund a legal tech startup than a person who has domain expertise and understands the value proposition.

The reality is, many legal startups struggle because potential investors have a hard time seeing lawyers as anything but a brick-and-mortar profession.

De-regulation of the UK Market

Amazing things are happening on the other side of the ocean. In the UK, the legal market is getting set to deregulate.  This means that private investment in law firms will be possible.  People in the UK will be able to purchase and receive legal services at their grocery stores or banks.  Some legal businesses will be listed on the stock exchanges.

I’m excited by what’s happening in the UK, and I predict we will see tons of innovative legal technology companies appearing in the near future.  Some people say that deregulation will eventually happen in Canada and the USA. I wouldn’t hold my breath.

What’s Next?

I’m pleased with the direction the discussion went and how open the panelists were to share their insight into a developing field of the legal profession.  There are exciting things on the horizon and I’m happy to be an active part of it

 

 Monica Goyal is a Toronto-based lawyer and a technology entrepreneur who founded My Legal Briefcase, an online legal service firm focused on small claims court cases.

Monica Goyal
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  • http://www.titanfile.com Milan Vrekic

    What worked for us is trying to relate our product to concepts and products lawyers already use.

    I agree about the investors. They consider legal, medical and government hardest sectors to get into. So we had to prove traction before getting any investment attention.

  • http://www.responsivelaw.org Tom Gordon

    I agree with most of what you’ve written here. As the legal and policy director of a nonprofit organization working to make the US legal system more user-friendly, I am appalled when my profession erects unnecessary barriers between customers and legal solutions, such as overbroad application of UPL statutes.

    However, although lawyers certainly are behind the curve in adopting new technology, the paucity of innovative delivery methods in the US is not primarily because lawyers lack a tech background. Rather, it is for another reason you allude to: the US ban on outside investment in legal practices. The ABA Commission on Ethics 20/20 is studying this issue now, but is at most going to recommend that outside investment be allowed so long as lawyers maintain a majority stake in the firm.