Last
week,
several
reports
indicated
that
McDermott
Will
&
Schulte
is
considering
restructuring
its
firm
to
accept
a
potential
private
equity
investment.
A
move
like
this
by
a
top
global
law
firm
would
be
unprecedented
and
test
ethics
rules
governing
ownership
of
law
firms
by
nonlawyers.
A
move
to
separate
legal
advice
from
other
legal
services
that
don’t
require
advice
is
a
big
shift
that
would
ripple
through
established
firms
and
also
test
regulatory
boundaries.
A
Trillion-Dollar
Market
Evolving
The
LegalTech
Fund
(TLTF)
sees
a
$1
trillion
opportunity
to
reinvent
legal
services
through
the
convergence
of
technology,
regulatory
changes,
and
innovation. TLTF
calls
this
movement
Law
Firm
2.0,
and
the
fund
believes
a
reinvention
will
pave
the
way
for
entirely
new,
tech-enabled
models
of
legal
service
delivery.
In
addition
to
the
chatter
around
McDermott,
others
are
taking
steps
toward
the
rethinking
of
legal
services.
Momentum
is
no
longer
theoretical.
Arizona’s
Alternative
Business
Structure
(ABS)
regime
now
supports
over
150
entities
that
legally
permit
nonlawyer
ownership. Additionally,
AI
law
firms
like
Crosby
are
making
headlines
as
they
announce
a
meaningful
$20
million
Series
A
investment. Eudia
is
making
headlines
after
acquiring
a
second
Alternative
Legal
Service
Provider
(ALSP)
last
month.
Law
Firm
2.0
is
gaining
momentum.
TLTF
Summit
—
Law
Firm
2.0
Panels
Last
week,
TLTF
offered
a
track
on
Law
Firm
2.0
at
their
annual
summit. I
had
the
opportunity
to
facilitate
one
of
the
panels,
interviewing
several
startups
about
their
vision
for
the
Law
Firm
2.0
movement.
Here
are
four
key
learnings
from
that
panel.
Deconstruct
and
Reconstruct
the
Law
Firm
Model
Covenant
is
a
new
technology-enabled
law
firm
that
integrates
AI
with
legal
expertise
for
private
market
transactions.
Jen
Berrent,
co-founder
of
Covenant,
views
Law
Firm
2.0
as
“The
deconstruction
of
the
services
a
law
firm
provides
and
the
reconstruction
of
those
to
create
a
law
firm
that
uses
new
approaches
and
leans
on
technology.” Covenant
is
pursuing
better
outcomes
for
its
clients,
including
lower
fees,
faster
transaction
processing,
and
deeper
insights
using
the
principles
of
Law
Firm
2.0.
Agentic
AI
Kiran
Bellubbi
at
Glade.AI
shared
about
the
power
of
agents
to
provide
greater
leverage
for
attorneys
to
perform
tasks. He
stated,
“AI
agents
can
think
and
act
for
hours
on
end,
collecting
information
and
performing
tasks
with
transparency
and
efficiency
under
the
supervision
of
attorneys.”
Data
Driven
Large
law
firms
often
struggle
to
find
information
and
to
leverage
their
scale
and
know-how
about
their
client
and
expertise.
Among
other
things,
DeepJudge
helps
firms
better
find
and
relate
documents
and
information
together
to
make
use
of
institutional
knowledge.
DeepJudge’s
founder
and
CTO,
Yannic
Kilcher,
stated,
“Law
firms
in
the
future
will
have
a
command
of
their
data
and
will
be
data-driven.”
New
Business
Models
Innovation
is
not
limited
to
software.
The
panel
also
discussed
how
redefining
service
delivery
can
align
fees
with
client
value.
For
example,
Glade
offers
a
SaaS
practice
management
solution
but
does
not
follow
a
standard
per-seat
subscription
model.
Glade
charges
by
progress
and
milestones
that
are
more
closely
tied
to
client
value.
The
Expanding
Map
Of
Legal
Service
Delivery
With
a
$1
trillion
market
opportunity,
there
will
be
competing
options
to
rethink
how
legal
services
are
delivered.
Large
firms
will
continue
to
evolve
and
leverage
their
strengths,
including
relationships
and
broad
experience,
as
they
improve
their
ability
to
use
data
and
new
technologies.
Incumbent
firms
may
restructure
along
the
lines
being
discussed
by
McDermott.
Upstart
technology-enabled
law
firms
will
leverage
AI
and
a
“blank
sheet
of
paper”
to
create
disruption,
particularly
in
specialized
practice
areas.
Managed
services
and
ALSPs
will
seek
greater
market
share
by
leveraging
the
ever-expanding
universe
of
technology
to
provide
attorney-reviewed
services
that
do
not
require
legal
advice.
Outside
investors
will
also
leverage
ABS
structures
in
Arizona,
Utah,
and
Puerto
Rico
to
accelerate
disruption
and
blur
the
lines.
An
Uber
Moment
When
Uber
launched
its
service,
it
did
not
wait
for
permission
from
taxi
regulators.
Customers
started
to
order
rides,
and
before
anyone
knew
it,
Uber
had
taken
over.
Regulators
followed.
Consumers
(and
some
attorneys)
are
using
OpenAI’s
ChatGPT
as
a
legal
expert. This
phenomenon
is
playing
out
similarly
to
Uber’s
approach
to
taxi
medallions.
Additionally,
most
Generative
AI
features
in
legal
tech
rely
on
OpenAI
or
another
large
language
model
provider.
The
practical
boundary
between
legal
information
and
legal
advice
is
growing
harder
to
define,
and
the
demand
for
clarity
is
intensifying. There
will
be
pressure
to
rethink
the
unauthorized
practice
of
law
(UPL)
depending
on
whether
lawyers,
nonlawyers,
or
technology
applications
are
involved.
The
ABA
Model
Rules
governing
UPL
(ABA
5.5)
and
nonlawyer
ownership
in
law
firms
(ABA
5.4)
did
not
contemplate
the
AI
revolution.
The
pressure
to
revisit
those
rules
at
the
national
level,
while
most
of
the
regulatory
authority
is
administered
at
the
state
level,
adds
complexity.
With
consumers
embracing
AI,
capital
flowing,
and
large
firms
like
McDermott
exploring
structural
change,
the
test
cases
for
Law
Firm
2.0
are
arriving
faster
than
many
expected.
The
legal
ecosystem
is
about
to
be
reshaped.
Regulators
will
need
to
move
quickly
or
risk
reacting
after
the
fact,
as
a
convergence
of
forces
will
redefine
legal
services
and
how
those
services
are
delivered.
Ken
Crutchfield
has
over
forty
years
of
experience
in
legal,
tax,
and
other
industries.
Throughout
his
career,
he
has
focused
on
growth,
innovation,
and
business
transformation. His
consulting
practice
advises
investors,
legal
tech
startups
and
others.
As
a
strategic
thinker
who
understands
markets
and
creating
products
to
meet
customer
needs,
he
has
worked
in
start-ups
and
large
enterprises.
He
has
served
in
General
Management
capacities
in
six
businesses.
Ken
has
a
pulse
on
the
trends
affecting
the
market.
Whether
it
was
the
Internet
in
the
1980s
or
Generative
AI,
he
understands
technology
and
how
it
can
impact
business.
Crutchfield
started
his
career
as
an
intern
with
LexisNexis
and
has
worked
at
Thomson
Reuters,
Bloomberg,
Dun
&
Bradstreet,
and
Wolters
Kluwer.
Ken
has
an
MBA
and
holds
a
B.S.
in
Electrical
Engineering
from
The
Ohio
State
University.