One of the high points of the year in global legal tech is the annual Legal Geek conference in London. Legal Geek is less of an industry conference than it is an ideas festival. The speakers at Legal Geek are there to celebrate and share some of the ways technology is transforming the legal space - and sketch out some visions for the future. Over 1,000 attendees joined in person in early October 2021, with another 1,500+ watching live online.
On stage for Kira Systems, now part of the Litera family, and presenting one of over 100 short, Ted Talk-style presentations, was Practice Consultant Josie Good. She held up, as she began, a simple automobile seat belt, which helped her explain a new approach to risk assessment in M&A transactions.
Josie’s talk was all about risk, and the ways that technology is transforming lawyers’ approaches to risk in the M&A context. Specifically, she explained how AI-based technology like Kira is allowing lawyers to review all contracts and documents relevant to a deal, not just those that have been deemed “material” by the client.
She provided some examples of how even relatively small and insignificant contracts, which might not be reviewed under traditional materiality standards, can include terms such as non-competes, most favored nation clauses, exclusivity, or even affiliates provisions that can potentially pose significant risks to a transaction or to the post-deal success of the parties.
Those are all examples of risks that a broader “Total Diligence” approach can eliminate. By using technology to review all contracts, not just those fitting the materiality criteria, lawyers can uncover those low-frequency, high-impact risks that were difficult to find before the technology was available.
Which brings us back to that seat belt. Most people wouldn’t ride in a car today without one - but it wasn’t so long ago that they were not standard equipment. Since then, however, the way that seat belts prevent catastrophic risks, at a low incremental cost, has made them ubiquitous.
Machine learning has not been around since 1959, like the seatbelt. But it has been around now long enough that lawyers really appreciate its ability to better assess risks in a way that would be humanly impossible to do with traditional diligence. The ability to provide a tech-assisted review of not just what is deemed material, but to have the machine do a first pass and be that first set of eyes on every single document, is what we call Total Diligence. And we think Total Diligence is becoming the ubiquitous approach to handling those risks.
As Josie put it, “because if you can, or more importantly, if another firm can, shouldn’t you?”
Watch the full 8 minute ted-style talk below:
Our Practice Consultants like Josie work with Kira customers every day, leveraging their own experience as legal practitioners. They have a deep understanding of the challenges and market trends in different practice areas, including M&A. Click here to sign up for a free market trends session to learn more.