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Catching Up with Jack Newton

How have you and how has Clio adapted to accommodate the dynamics of the legal world?


Frankly, Clio is driving a lot of that change, not reacting to it. When we launched in 2008, we were the first cloud-based practice management system to market. And so our approach to guiding our customers along through change across the wider legal industry has been highly iterative in the sense that there are distinctive chapters in the history of Clio that mark both Clio and the legal industry’s evolving relationship with technology.


The first period of transformation, spanning 2008 to 2018, was about driving adoption of the cloud and helping lawyers migrate their systems. The value proposition at that point was oriented around productivity and the value of the cloud. This is around the time I published my book, The Client-Centered Law Firm. While the first 10 years of adoption were oriented around a technology change, we eventually started looking at the cloud as something that could fundamentally transform the client experience in addition to changing how law firms operate. The book was really about a mindset shift.


The second period of transformation emphasized the notion that law firms have every opportunity to transition away from traditional bricks-and-mortar methods of delivering legal services to embrace the cloud. Furthermore, the majority, if not all, legal transactions and interactions could be significantly enhanced in terms of efficiency and benefits to both lawyers and clients if they’re conducted in the cloud and facilitated by technology. This is not to diminish the value of face-to-face meetings—there will always be value in that for lawyers and their clients. But we really started questioning the value of expensive AAA office space in downtown Manhattan or in downtown LA to meet your clients when they might be just as happy, if not happier, simply jumping on a video call with you to talk about their legal matters.


There’s so much improvement when delivering legal services in the cloud, whether it’s something as simple as e-signatures or an online portal to collaborate with your clients or a multi-party video call or a live document that you can collaborate on. This is a massive upgrade to the old pen and paper, bricks and mortar methods for legal consumers. This proactive shift towards a more client-centered approach proved unexpectedly prescient, as it preceded the pandemic by two years, aligning with the advancements driven by the technology transformation wave.


Finally, the third chapter that we’re currently in, began just over a year ago. This is of course the generative AI revolution and overall AI advancements. I believe AI is reaching its full potential in the legal space, poised to fundamentally transform every aspect of the legal profession and how lawyers operate—which is incredibly exciting.


I view Clio's role in this third wave as twofold: first, as stewards of these technologies within the legal industry, ensuring their deployment in a safe and reliable manner that aligns with lawyers' specific client requirements and professional conduct rules. Second, we strive to optimize the use of these technologies to cater to the unique needs of lawyers.


Do you see Clio helping show the lawyers that are Clio clients how to safely use Generative AI in ways that are effective and powerful for lawyers?


It's crucial for lawyers to understand that their perspective on technology, especially with generative AI, needs to undergo significant change. It’s a complete paradigm shift, and one that can be dangerous if the nuance of what this shift represents isn’t fully understood. Unlike the trust we often place in platforms like Google and Wikipedia, which reliably provide accurate information, generative AI introduces complexities. While these platforms typically deliver correct answers, they don't fabricate or mislead users. In contrast, generative AI may generate inaccurate or misleading content, highlighting the need for caution and discernment in its use.


It's essential to recognize that the current iteration of large language models and generative AI can produce hallucinations, fabrications, and unreliable content. Some compare verifying their output to supervising a first-year associate, but the analogy falls short. Unlike an associate who typically strives for accuracy, AI may generate entirely fictitious information, as evidenced by the infamous Stephen Schwartz case where ChatGPT conjured five nonexistent cases while assisting in drafting a legal brief.


I do think that many of these limitations and issues surrounding hallucination are going to be temporary. We'll discuss them much like we did with early technological challenges, such as understanding web-based applications offline or dealing with internet access issues. Over time, not having internet access became akin to losing power; it rendered work impossible. Similarly, AI will evolve into an indispensable utility, akin to other everyday technologies. However, as with any emerging technology, we must remain vigilant and attuned to its limitations, adjusting our expectations accordingly.


The need to understand the technology you’re using is profound and fundamental. Lawyers must recognize that ultimate responsibility rests with them; technology itself cannot be blamed for errors. Whether it's ChatGPT or any other generative AI, these tools lack self-awareness and hold no duty of competency, privilege, or confidentiality. These responsibilities lie solely with the lawyer, who cannot delegate them to artificial intelligence. While leveraging AI as a tool in their practice, lawyers must acknowledge their accountability for the end result and recommendations they provide to clients.


AI should be viewed simply as an input. In its current iteration, generative AI outputs can be likened to a rough first draft. While preferable to starting from scratch, thorough editing and scrutiny are necessary. Lawyers must meticulously review and refine the generated content, understanding their fiduciary duty to clients and the need to uphold the quality of their work.


How do you still emphasize the importance of people and ensure that they still feel like they have a place in society when perhaps some may feel that they are being outshined by technology?


I ultimately think that technology’s role is to elevate humans to their highest purpose and highest impact. As we assess the advancements technologies—from the cloud to AI and everything in between— there's an opportunity for lawyers to enhance their humanity. Rather than viewing AI as a threat poised to replace them, I see it as a tool that liberates lawyers from mundane tasks. By automating routine and tedious aspects of their work, AI enables lawyers to focus on higher-value activities and foster deeper connections with their clients. This evolution allows lawyers to provide more personalized and empathetic support, ultimately becoming genuine partners in solving their clients' challenges.


This presents a tremendous opportunity for individual lawyers and the broader legal community. There's a pervasive concern among legal professionals that AI may replace them and shrink opportunities. In my recent keynote at ClioCon, I addressed this concern and highlighted a staggering statistic from the World Justice Project: 77% of legal issues worldwide remain unresolved with the help of a lawyer. This underscores the vast potential for lawyers, supported by AI, to enhance efficiency, streamline service delivery, and better cater to consumers' needs. As AI boosts lawyers' efficiency and increases their value in the legal economy, we anticipate a significant rise in the number of legal professionals participating in this expanded market. The current trillion-dollar legal economy only addresses 23% of legal issues, indicating a vast untapped market. By leveraging cloud and AI technologies, lawyers can tap into this latent legal market, unlocking a massive opportunity to provide legal solutions to more consumers.

What would you say you are looking forward to the most next year?


I’m very excited about 2024 being a year where we see some of the AI hype turn into AI reality. In 2023, there was a surge of AI startups and concepts, generating significant buzz, but not all had substantial merit. Moving forward, we'll witness a positive trend of separating true technological innovations from superficial advancements, such as mere iterations of existing models like GPT4 without added value.


In the coming year, I foresee significant progress in core Large Language Models (LLMs) by industry leaders like OpenAI and Anthropic. Efforts to address hardware shortages, such as the development of the NVIDIA H100 processor and its emerging competitors, promise to propel AI innovation further. These advancements are poised to make a notable impact as they hit the market in 2024.




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