The legal industry continues to grapple with changing times. While managing client expectations is a challenge as old as the law itself, the next generation of legal professionals are creating new challenges by making work-life balance demands that have been unheard of in the industry. Artificial intelligence (AI) is also changing the legal game. Attorneys and clients hope to be able to commoditize AI to cut costs and address the overwhelming reputation of attorneys being unaffordable, but AI continues to be unreliable for much more than data organization.
Recently, a group of attorneys met at a roundtable sponsored by Nevada State Bank to discuss the challenges the legal industry faces. Connie Brennan, publisher and CEO of Nevada Business Magazine, served as moderator for the event. These monthly roundtables bring together different industries to discuss issues and solutions.
What Impact Does AI Have On the Legal Industry?
Gregory Gilbert: They reason why the AI issue is so intriguing and earth shattering is because it impacts the entire court system. It impacts how we think and practice as people. It impacts the way young lawyers think about the practice of law. And it impacts the way that clients think about how quickly an answer should be provided to them. There are ethical issues and competence issues with AI. To attorneys, it is an absolute game changer.
Alicia Ashcraft: Twice in the last four to six months, I have had clients who drafted contracts using AI and sent them to me for review to economize and stretch dollars. Since lawyers are expensive, the thought process is, if a client can use ChatGPT to create their own contract and only have the attorney review it, it will be cheaper. But they include huge sections of information that require review. They were able to draft a contract in 15 or 20 minutes, but they wonder why they were billed two hours for it.
James Pisanelli: Everyone at this table has been practicing long enough to know the transition of technology making things better. Email, for instance, has become the plague of commercial litigation because it has made everything so expensive. And, though technology was developed that made the analysis of email better, it did not necessarily make it cheaper for the client because that technology also comes at great expense. We can go back even further with research. Most of us grew up in an actual library when we were associates. Then Westlaw came along, and LexisNexis. But they did not make it necessarily cheaper for the client because they came with their own expense as well. The open question is, as AI finds its place in what we do, who will it benefit? Will it benefit the owners and the controllers of the AI programming? Will it benefit the lawyers? Probably yes, across the board. Will it benefit the actual clients? I am not so sure.
Dana Dwiggins: It is going to shift the focus, in large part, from what the attorneys are charging to what these companies that control the AI are charging. We had a situation recently that flabbergasted me. We always ask clients how they were referred to us and twice we have received referrals from ChatGPT. The question is, when will it start monetizing referrals so that attorneys can advertise on it?
Ashcraft: I have a friend who is a transcriptionist and she is being given programs and transcripts that were initially transcribed through AI and then she was told to clean it up. Every time she makes a correction, she is teaching the program. In essence, she is teaching the program to put her out of business. That is pretty much what we are doing every time we log in to Westlaw or LexisNexis AI and generate a document and then correct it. AI is going to hit the lower technical folks first and then work its way up.
Mark Ricciardi: The legal research and brief writing is only one piece of the AI tool. We are going to see enormous strides in efficiency when it comes to document review, document production, drafting and transcript review. We have been telling people that AI is not going to put them out of a job, it is going to make them more efficient. It will allow them to get more done, and our clients will reap some benefits from that.
Avece Higbee: AI could easily expose the laziness qualities that some of the newer attorneys have. It could come to the point where they are the ones that are not going to practice law anymore.
Gilbert: AI will severely impact the number of lawyers that are necessary and the type of lawyers that are necessary. And probably in one year, this conversation will be completely different than the one we are having right now.
Samuel Schwartz: AI is dangerous in some ways, but in other ways it is going to commoditize a lot of what we do and make it a little more affordable.
Barbara Buckley: AI still cannot be trusted on its own. We had a trial where we found out that the expert witness used AI, and the [citations] were wrong. We had the expert report stricken. It is still not reliable at all, and attorneys are getting into trouble because of it.
Dwiggins: There was a Judge Hardy decision up north that came out recently where he was reviewing the brief, the opposition wrote an approximate 20-page opinion of the 20 cases and four of them were made up. Sixteen of them did not even have the quoted items that were in the cases. The attorney ended up getting fired from the firm. He got sanctioned and referred to the state bar.
Michael Feder: AI can be much more of an asset than a liability so long as it is used correctly. You still have to put the information in to get it out. The fear whenever we do a document review is that we are going to miss a key document. I am not 100 percent comfortable with it yet, but I am getting there.
Schwartz: You have to ask the right questions when you try to use AI. Even when you do that, it still is not always right. It is getting better every day, but it is there to organize, not to replace.
What Challenges Does This Industry Face in Finding Talent?
John Steffen: The problem that we all face constantly is the difficulty in finding competent, hardworking and loyal attorneys, paralegals and staff to keep up with the ever-increasing workload that we all have.
Ricciardi: It is a challenge to find competent and good lawyers, especially at a level where they are able to handle cases and it is probably going to continue to be a challenge in the future.
Dwiggins: There was, in recent years, a plateau of attorneys because the number of attorneys passing the bar was similar to the number retiring. That has been part of the problem in finding new talent.
Pisanelli: From a firm management perspective, there is just no question, the primary challenge we face is the recruiting issue, in particular with trying to be in a space that is typically occupied by large firms. We are competing with salaries for the best talent.
Charles Gianelloni: Another challenge that we are spending a lot of time dealing with is trying to keep associates engaged and happy in this post-COVID world. With previous generations, you could pay a certain amount of money, and they would just work. Now that does not seem to necessarily be what associates want. Matching what associates want and need with what the firm needs is a big challenge.
Higbee: The quality of the legal profession, with some of the younger attorneys, is also a little scary. Many of them are bright and really want to work, and some of them plan on working just a little while in law before they open their own CrossFit.
Pisanelli: All of us will agree on the frustration of the new generation bringing a new culture into our firms that is different than what we learned. We were working more hours and were thinking about our problems and our clients’ problems, virtually 24/7. They are not. Culturally, they are willing to only give you so much of their life, and that is the end of it. That is frustrating from the firm management perspective. But we would probably all agree if we were talking about that same associate and they happen to be one of our kids, then from that perspective we would probably think good for them. Because I have been down that path and know what it is like. I know how it ages you in dog years.
Feder: I applaud those who think of work-life balance coming out of law school because I do not think any of us thought about that. We already knew that 2,000 or 3,000 hours a year were coming. I remember my wife telling me to go and do what needed to be done while we still did not have kids. She told me that she would see me in a couple of years. In today’s world, when it is five o’clock, the new attorneys are going home.
Pisanelli: There is something about it that I admire. I do not love it in the middle of a trial and when I am not getting what I need immediately, but I do admire it. Culturally, this new generation is coming in and saying these are the rules of the game. If we do not like it, then there are seven other law firms down the street that will probably pay them more.
Feder: There is a balance there. Those who are willing to put those long hours in stand out now in our offices more so. That used to be the norm. Now it is unusual.
Dwiggins: It is also hard to find associates that want to work in the office. They do not fully understand that you learn by interaction, and you cannot learn on your own at home.
Feder: Many of our younger attorneys want more of a hybrid approach between the office and home. We need to get back to that one-on-one interaction so that they can learn.
Gilbert: Our industry is still structured on the apprentice model. You learn so much by being in the trenches and being in the wars and learning from your own mistakes. Being around people, sharing ideas and having an actual sense of fear and obligation to the client with performance anxiety motivates us to talk to each other. It motivates us to pick up the phone and call colleagues to ask them if they have experience in a certain area. If you are in your den doing your own thing, you are not exposed to that.
Gianelloni: One thing that has been successful in bridging that gap since we do not have those water-cooler moments anymore, is our partners forcing check-ins with our people at home. Every Monday and Wednesday, they have required Zoom check-ins or calls, or they can be at the office. That little push has helped some of our associates developmentally to improve, which is good for everybody.
How Do You Manage Client Expectations?
Feder: It varies by client. An email may be one thing, but clients do not just email. They will also text and call. And when they text and call you, they have an expectation that you will get back to them as quickly as possible. Because immediately, I think it is something extremely important. There is also a difference in culture with today’s newer generation. They will not turn off their phones, but they will also not respond to anything if they are not working.
Ricciardi: There is a difference between work-life balance and responsiveness. If a client or a partner contacts an associate at 2pm on a Saturday afternoon, it may not be something that has to be done at 2pm on a Saturday afternoon. If the associate responds with, “Hey, I will get on this. Is Monday okay?” It gives clients peace of mind, and it gives partners peace of mind. But to just be on radio silence is a problem and I am hoping we can break them of that.
Schwartz: A key part of being a good lawyer is being available. And if you want to be someone who actually has business, then you probably pick up that phone most of the time.
Ricciardi: In our world, when it comes to a pressing employment law question for example, frequently, the person who is calling us was ordered by the CEO or the vice president, to call. And the fact that I answer the call and tell them not to worry and that I will get back to them, they can then go to their boss and tell them they talked to the lawyer, and they are working on it. That peace of mind took five minutes out of our work-life balance.
Pisanelli: The two most important words that I would give to any lawyer at any age in this business are “managing expectations.” That applies to everything, from communications all the way down to the bill. We have all had clients that call because they are not happy when they receive the bill. But, had they known a bill was coming that was going to be big, then it is a lot easier for them to digest. It all comes down to communication. The most important thing we do in managing and maintaining good relationships with our clients is managing their expectations.
Schwartz: Case size can dictate negotiability. But clients just want to feel like you are being fair with them, and you are not just charging them. When you include some sort of cap or curve or something along those lines, I find that the clients are very receptive to that. It helps when you talk about the bill as it comes in.
What Reputation Do Attorneys Have?
Buckley: There are 5 to 10 percent of lawyers in all areas of practice who should not be lawyers. They lie, they cheat, they bring discredit on the profession, and you hate when you are in the same room with them. The rest are usually great people, and there are great people in every area of practice.
Steffen: Someone made a comment to me recently that attorneys do not solve problems, they only escalate them. And as a general rule, we should strive to be better problem solvers. We live in a time where there is so much contention and hostility around us. We are called “Counselors of Law”, and we have all the tools to be better problem solvers rather than problem escalators. We all know that there are very difficult people to work with that can really escalate the cost of litigation and solving a problem. But as a whole, we can strive to do better at being more cordial and working together to solve problems.
Schwartz: We were discussing today in one of our cases a $35 million budget for the professionals. Another attorney mentioned that in most of the cases he works on, the budget is around $150 million for the professionals. And when we start talking about those kinds of numbers, we are potentially litigating our way out of the market.
Pisanelli: From a market perspective, I hear very frequently how expensive the system has become. It has become so expensive that you question if commercial litigation has become a rich person’s privilege. The rates that we charge and even the consultants who also have big firm clients have rates that have grown along with the rest of ours. There seems to be this middle ground of small claims that can find a place and find a lawyer. But then the giant claims that always have a lawyer causes the middle section to feel like it is getting squeezed. They can’t afford those of us that characterize ourselves as purely commercial litigators.
Schwartz: The business of law at times has gotten in its own way and made it so expensive to do things and litigate. And people just can’t afford it. That is a real fear. AI is going to help bring those costs down and is probably the biggest threat to paralegals at the moment, more so than it is to lawyers. So that could be positive in terms of cost. But ultimately, we decided it is better for business to fight than it is to make a deal, in which case we fight, right? Because we are counting it on our side. It is better for the bank.
The Rise of Class Actions in Gaming: What Developers Need to Know
In the last several years, U.S. consumers have sued game developers to impact game elements viewed as intentionally addictive or deceptive, both to adults and minors. The concerns parallel a market shift from paid to “free” games. “Free” often is free to download, but not to play. Legal claims allege the games are unfair and deceptive. There are also claims around privacy violations, and unfair use of bots or AI. Regardless of the outcome, having to defend lawsuits can cost developers time and money.
The addictive aspect of games draws attention. Federal legislation to curb these stalled previously but could come back. Newer state laws protect minors from addictive code even if there’s pushback on First Amendment grounds. Deceptive or false trade practice claims can be brought in many states under longstanding laws not specific to gaming. Creative plaintiffs also seek to shoehorn “new” technology (how game software works) into older invasion of privacy or anti-wiretap type laws. Heightened privacy laws enacted in the last five years have changed U.S. privacy, making details around gaming behavior and transactions protectible “personal information.”
Addictive features
The idea scarcity increases value is not new. Loot boxes and similar elements promoting random chances to receive digital assets giving an advantage in a game use this principal. The rare, wonderful loot is hard to come by, but the chance one could attain it if one keeps trying has players coming back over and over. This element is perceived as fostering addiction. Plaintiffs have even sued major app stores distributing the games. The app stores take a “don’t shoot the messenger” position but the industry does increasingly disclose when “in app purchases” are possible.
The addictive elements alleged include “gambling” features like casino games, flashing lights, bright colors, pressure sales tactics (i.e., lower price for loot is expiring, get it while you can), certain “stealth” advertising in-game, free game currency to start, which can only be acquired for “real” money once depleted to keep playing, and characters players form parasocial relationships with in the games. The advice for developers is: be intentional in your designs and understand how certain elements may be perceived.
Deceptive microtransactions
Deception is not merely about inaccuracy. It can also involve a lack of transparency or details to make something not misleading failing to have been disclosed. Loot boxes buys or paid microtransactions (i.e., low dollar transactions that add up) are claimed as “not transparent” at best and at worst intentionally deceptive. For example, games may essentially be incomplete games with content added over time to make them more complete, such content being acquirable via a combination of ongoing play and/or payments. The loot each player receives differs and it’s unclear how much loot or how much time and expense is required to attain a desired level or rank in a game based on spending real or virtual currency on loot in a game. This kind of lack of transparency could potentially foster addiction. Developers should consider both how the game elements will be perceived and potentially misperceived.
Not keeping pace with heightened privacy laws
Many digital services have been sued for failing to disclose personal information collected, how it is used and who it is shared with, tracking consumers without their consent, and similar behaviors alleged to violate privacy. This comes up both with adult and minor data subjects. Several of the laws at issue have statutory penalties, meaning conduct alone – whether or not intentional – could result in damages. Ignoring the laws could result in heightened damages. Developers are encouraged to know which laws apply and consider meaningfully how to comply. Also, don’t copy someone else’s privacy policy. A privacy policy is only protective when it reflects what your business actually does/does not do.
Lack of technical transparency
Some developers are suing one another for failing to disclose how bots or AI are used to match competitors in games, or play in games against real people, which could be unfair to the consumer who can’t tell what is happening. These claims are ones to watch as they work through courts because presumably tech-driven solutions will continue to abound.
Karl Rutledge focuses his practice on gaming and promotional marketing, with an emphasis on eSports, skill-based contests, sports betting, social gaming, sweepstakes, official rules, and terms and conditions. Nadia Aram has an overlapping practice and also advises clients on privacy, advertising claims and licensing. Womble is a full service firm and guides gaming clients on up front compliance (when setting up a business or offering) and backend compliance when claims are made against clients, including defense of class action litigation.
