On Commoditized Free and Low Cost Legal Work and the Future of Legal Services

July 24th, 2009

This post weaves together several threads for me: a speech by “legal futurist” Richard Susskind I just finished listening to on the future of legal services (he talks about a move toward commoditized, low-cost legal services), Orrick’s free library of basic corporate documents and the extraordinary amount of hand-wringing and teeth-gnashing I see around me in the legal industry these days.

Here’s the premise: legal services are mostly offered on an individualized, fully custom basis for each client. Attorney rules of professional conduct create a duty of care to clients that make it hard to give people forms and help them a little.  Firms can give away documents with disclaimers about making any changes, but the duty of care makes it hard (today) to create a high volume/low margin business of this.

Orrick has released a set of corporate forms that anyone can download and use; WSGR has a term sheet generator for venture financings that uses a detailed questionnaire to produce a term sheet based (presumably) on WSGR’s extensive expertise negotiating these types of arrangements.  D.C. Toedt’s Firstdrafter project works along the same lines, allowing anyone to find, fill in and use various contract forms.

These are great steps and very much in line with Susskind’s premise.  They aren’t quite the same thing, though.  First, they are freemium products intended to bring new clients in the door.  By giving away a teaser, the firms hope to sign up a bunch of new clients to customize and work through the transactions behind the documents.

I was fortunate to demo a product recently called FirstDocs that promises to change the landscape significantly. FirstDocs lets law firms use best-of-breed documents to create document templates with fill-in or multiple-choice sections for custom terms.  Things like names can be entered once and populated across multiple documents, saving a bunch of time.

More to the point of this post, a law firm could give clients access to this forms library so that the clients themselves can create documents, but with only limited ability to make changes (note: I haven’t talked to FirstDocs about this and I am not sure if their product currently allows exactly this ability).  Alteration of substantive terms would need to come back to the lawyer, which would help ensure that the documents are used only for their intended purposes.

I know there are firms and companies doing things like this today and I am sure FirstDocs is not the only company innovating in this area, but it was an eye-opener for me to see it in action.  It became immediately clear to me that this type of document preparation is the future of legal services.  So much of what we do is form and template-based already, but our habits and tools still require us to maintain substantial oversight of each project.  We need ways to generate careful, top-quality documents with less attorney input on each project.

As Susskind says, more and more legal services are going to slide across the spectrum from custom/high-cost to commoditized/low-cost.  Figuring out which ones, how to make it happen without sacrificing the duty of care to each client and how quickly it will all come about is the fun part.  VLP is developing organizational and technology structures that will let us work at the vanguard of this trend and it is exciting to be part of.

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