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Legal Data: what, where and why?


Roman Kaczynski assists law firms and in-house legal departments in their digital transformation. He combines knowledge of the law with practical expertise in legal tech and innovation management to deliver organisational solutions which are adapted to the new realities of the business world.

Legal data and analytics are often touted as the future of our profession. In practice, however, identifying, collecting, and exploiting legal data can be challenging and almost impossible without dedicated tools. This article gives a short introduction to what legal data is, suggests where to collect it, and explains why it is valuable for law firms.

What is legal data and why collect it?

Contract Data

What: any information from a contract including parties, clauses, values and dates. 

Where: Using a document automation solution allows you to automatically collect metadata from the documents you create. For documents created before the implementation of document automation, a Document Analysis solution will help you to review documents on file and collect data that you need. With a good OCR (Optical Character Recognition) tool, you will even be able to analyze PDF (mostly scans) if you do not have the text format version anymore. 

Why: Contract data can be used to assess the value of a company’s various contractual obligations and identify the risks involved in those contracts. This can assist in the valuation of an entity involved in a transaction. Contract data can also be used for knowledge management, for example by highlighting clauses which were used in more profitable deals so that they can be used again. Another use case is tracking versions of a draft document to determine which clauses are most important for the other party in order to inform a negotiating strategy.

Matter Data

What: internal data on current and previous matters a firm has worked on, including clients, lawyers, other professionals assigned, time to resolution, and outcomes.

Where: Look at matter and billing data from your existing systems. Most case management and billing solutions allow you to generate reports on this data. However, if you don’t have such a tool in place(!), you should regularly ask each lawyer in your team for a summary of their ongoing tasks.

Why: Regular analysis of matter data will help identify process bottlenecks, and determine which professionals are able to perform which tasks better or quicker. This in turn allows a firm to identify subject matter experts who can help upskill the rest of the team. Case outcome data can, for example, be used to evaluate whether certain types of litigation can be pursued more efficiently or even whether a given case is likely to succeed.

Billing Data

What: the financial data behind matter data, including matter type, lawyers assigned, amount billed, and any discounts or write-offs.

Where: This should be the easiest kind of data to collect, as most law firms already use billing software that can generate reports.

Why: Matter management and billing data can be used to compare the costs of a given case against previous similar matters. This can help provide an accurate and competitive fixed-fee proposal with lower risk for the firm. The same data can be used to identify types of matter which take up lots of time but where not much is billed and recovered from the client, with a view to targeting more profitable business.

Court Judgments

What: any data relating to a judgment, including dates, parties, legal issues argued, judge, citations, treatment of cited cases, and editorial metadata (headnotes and key number classifications)

Where: Collection and use of judgment data is almost always difficult as it is rarely available in a machine-readable form. In many countries, only some court decisions are even publicly available. This lack of access recently led to a dispute between two big legal tech providers.

Why: By looking at the success rate of similar motions or suits before the same court or even before the same judge (judicial analytics), firms can predict whether a motion is likely to prevail. In some jurisdictions this matter has become particularly controversial. In France, for example, it is now illegal to use judicial analytics to analyse or predict the likely outcome of a given case before a particular judge.

Mix and Match

These types of data are all valuable in their own right, but can become even more useful when put together. Combining the different types of data can yield additional insights. Consider the following formulas: 

Matter Data + Billing Data = Efficiency Insight 

By comparing the time spent by lawyers on a matter and the final price charged to the client for this work, it is possible to determine whether lawyers are being utilised properly and whether engagements are cost-efficient.

Matter Data + Court Judgments + Billing Data = Litigation Decision Support

By looking at the outcomes of previous cases, the value of the relevant judgments (judgment data) and historic legal costs (Matter Data + Billing Data), we can more reliably determine whether it is worth settling a matter or taking it to trial. 

Contract Data + Court Judgments = Contract Risk/Stability 

This is a more long-term strategy as it requires looking further along the contract lifecycle, but it could definitely add value during contract negotiation. In the future it may be possible to connect data from court judgments with data on specific clauses or types of clause, highlighting where disputes have arisen over certain clauses and how courts have resolved them. This would make it possible (during the early stages of drafting) to determine the risk of a contractual provision being litigated or found unenforceable by a court. 

How to collect legal data

Many firms want to get started collecting legal data but don’t have a dedicated legal tech solution in place. Data can always be collected manually through surveys, interviews, observations, documents, and records. But this approach presents the challenge of how to clean, organize, and store the data in an easily accessible way (including the ability to filter and classify it). One solution could be a simple spreadsheet. However, the cost of the time needed to update and curate the spreadsheet could easily outweigh the value added by the data! 

Firms can invest in a Data Management Platform (DMP), a software platform used to collect and manage data. However, these solutions are not constructed specifically to collect legal data, and their use in this context will usually require some configuration and adaptation. A better approach is to deploy dedicated legal tech solutions for document automation, matter management, and document analysis. These will export data that you can exploit according to your needs. The better the data you can collect, the greater the value you can extract from it for your practice and clients.

Roman Kaczynski


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