Legal Ops Professionals Weigh In: Higher level of analysis in law departments drives shifts in the industry

Saturday, October 28, 2017 - 14:02

The ambitious webinar hosted by Metropolitan Corporate Counsel on September 7 took on four big topics that were filtered through surveys primarily directed at legal operations departments. The topics were information security; analytics and artificial intelligence (AI); cloud adoption; and discovery and content management.

Hal Marcus, OpenText Discovery’s director of product marketing, moderated the session, and he brought in three guests. Ari Kaplan, a legal industry analyst who runs Ari Kaplan Advisors, has surveyed legal ops departments in recent years. He drew on a survey he did in 2015 and another he added this year. Sandwiched between them was his 2016 survey, which queried law firm partners with e-discovery responsibilities. The surveys supplied the data that underpinned the discussion.

The central question was how views have changed during the past three years on topics that occupy many lawyers, whether they work in firms or in-house. Fittingly, Marcus brought in David Stanton, a litigation partner in the Los Angeles Office of Pillsbury Winthrop Shaw Pittman who heads its information law and electronic discovery practice team, and Sharika de Freitas, who manages e-discovery at Viacom.  (The panelists noted that their views did not necessarily reflect those of their employers.)

Information Security

Some of the findings were predictable. In 2015, 72 percent of the ops directors had concerns about the security of discovery data. Given the explosion of breach cases in the headlines since then, Marcus noted that it wasn’t surprising that 88 percent of the law firm partners shared those concerns last year, or that this year 89 percent of the ops directors did.

Next came an interesting disconnect. Despite their concerns, very few law departments audit the technological competence of their outside counsel, according to the surveys. The 2015 and 2017 figures were confirmed by the law firm partners. Only 16 percent of them said they experienced audits.

But that may be changing. Pillsbury’s Stanton said that he has seen “a significant number of very mature organizations” in finance and tech conduct “fairly exhaustive audits.” It’s not happening everywhere. “It seems to be varied,” he said, “but it’s picking up.” Kaplan noted that 37 percent of this year’s respondents said they plan to focus on this area in the coming year. He also said that law departments haven’t pressed harder because, as several in-house respondents candidly acknowledged, they haven’t been burned yet by outside counsel’s lax security, and a big breach could quickly change attitudes.

Those sentiments rang true for Viacom’s de Freitas. Industries tend to adopt a herd mentality: “Hey, it didn’t happen to us, so we’re safe.” On the other hand, she continued, “if one of your competitors has that happen to them, it basically lets us all know that we’re all on the front lines.”

The Cost and Value of Technology

The next topic was AI and analytics, and Marcus pointed to the huge gap in attitudes between legal ops directors in 2015 and law firm partners the following year. The ops respondents overwhelmingly (92 percent) said they would expand their use of discovery analytics – tools to support data reduction, fact finding, and faster review – if cost were not an issue. Only 52 percent of law firm partners agreed. Marcus noted that the question left room for a variety of interpretations, and the ops response to the same question this year was down to 62 percent. He asked de Freitas what she made of these numbers.

“I think it might be mostly indicative of what software is in the company’s tool sets when they’re responding to this,” she said, “or what kind of partnership they have with service providers to secure access to discovery analytics without incremental costs. Because normally if you’ve invested in legal ops, you’ve probably also invested in technology.”

Stanton’s take on the law firm numbers was that they likely reflect the specialization that’s developed in this field. The firms that are taking on high-end, big-data discovery projects certainly recognize the cost-benefit of investing in technology, he asserted. But not that many of them are jumping into this work.

And AI? Only 23 percent said they use it in their shops. Kaplan said that the subject still elicits fear – not of AI itself, but of its potential to steal jobs. “They’re concerned about actually educating the AI to get to a point where it actually is more efficient, rather than yet another burden, another tool,” he said.

There’s also some confusion about definitions. Is predictive coding AI? That wasn’t clear to some of the surveys’ respondents. Marcus jumped in with a graphic that showed the number of companies that use AI would have been substantially higher if predictive coding were understood to be an AI tool, since 34 percent said they’d used it in the last year.

Despite the numbers, Stanton and de Freitas expect the adoption of AI in the business world to expand rapidly, as it has in the consumer world. Stanton noted that it’s already infiltrated modern life – in the auto-correct on our phones and the recommendations offered by Netflix and Pandora (among many others).  “The legal industry seems to be slow to adopt anything,” lamented de Freitas.  Still, she and Stanton predicted that change in this area is inevitable.

Slowly Moving to the Cloud

There’s a different issue when it comes to adopting cloud storage. For many lawyers, there’s an ethical impediment. “The notion of being somebody else’s fiduciary is kind of ingrained in lawyers from the beginning,” Stanton said. That gets in the way of losing control of data. But here, too, he sees the inevitability of change. The driving force, he said, is that other large organizations that have the same concerns and the same duties have already made the leap: “Largely, it’s our clients.”  

Viacom’s de Freitas has seen the debate over pricing and security, but she agrees that for large companies, it’s only a matter of time.

Kaplan then noted that the discussion, in a sense, is beside the point. Companies have been moving their data to Microsoft Office365, where all of their email and much else is firmly in the cloud (even if users don’t always know it).

Massive Mounds of Data

The last topic revealed the ugly underbelly of the data world. Enterprise content management (ECM) is supposed to organize data. But it seems common for large companies to have competing ECM systems. When Kaplan asked respondents how many ECM systems their companies had, some of them had no idea. “Unknown. Many,” responded one. Another person just laughed.

To make matters worse, e-discovery data exists in a separate silo. The survey found that 74 percent of the legal ops directors would like to see the ECM and e-discovery systems integrated in their enterprises, but that doesn’t seem likely to happen anytime soon, according to de Freitas. She’d welcome the prospect, she said, but it would take a lot of cooperation and discipline among different divisions of the company, especially IT and Legal. And the technology changes so quickly that it would be very difficult to maintain.

Kaplan cited one last statistic near the end of the webinar. The survey revealed that 80 percent of the respondents influence content-related decisions at their companies, but 83 percent noted that responsibility for these choices rest squarely in the hands of IT.

That seemed to capture the theme that ran through the discussion. Though it may be a bumpy road with lots of disconnects, lawyers are slowly adjusting to the opportunities and challenges of the data explosion, and the technology that both produces and can help tame it.


Hal Marcus is an e-discovery attorney and the director of product marketing for OpenText Discovery (home of Recommind and Guidance Software). In that role, he educates corporate and law firm counsel on technology strategies for litigation, investigations, compliance and information governance. He can be reached at hms@opentext.com.

Ari Kaplan, founder of Ari Kaplan Advisors, is an attorney and legal industry analyst. He is also the author of two books: “The Opportunity Maker: Strategies for Inspiring Your Legal Career Through Creative Networking and Business Development” (Thomson-West, 2008) and “Reinventing Professional Services: Building Your Business in the Digital Marketplace” (Wiley, 2011). He can be reached ari@arikaplanadvisors.com.

Sharika de Freitas is a discovery solutions and technology senior manager at Viacom Inc. She has 13 years of litigation experience working both in law firms and in-house law departments. In her current position, she manages e-discovery needs and develops strategies to defensibly implement and satisfy hold obligations. She can be reached at Sharika.DeFreitas@viacom.com.

David Stanton is a partner at Pillsbury Winthrop Shaw Pittman LLP. He leads the firm’s information law and electronic discovery group, oversees the firm’s nationwide litigation support department and is a member of Pillsbury’s privacy, data security and information use group. His practice focuses largely on emerging issues involving the intersection of law and technology, including information governance, electronic discovery, cyber risk, privacy and incident response. He can be reached at david.stanton@pillsburylaw.com.