What Is Legal Analytics? (And How Attorneys Use it to Guide Litigation Strategy)


Written by: Jesse White
Legally Reviewed by: Jennifer Tsai and David Curle

November 19, 2020

6 minute read

While the altruistic aspects of practicing law are important, lawyers must remain mindful that a law practice must turn a profit to survive. While it may seem easy, the business of keeping a law firm profitable can be daunting, especially in areas of practice such as personal injury, where the fee is far from certain. So how do successful law firms quantify the seemingly intangible factors associated with practicing law? Legal analytics.

Legal analytics is defined generally as the application of data to the business and practice of law. Using machine learning and artificial intelligence, legal analytics can sort through massive amounts of data — from court dockets, court decisions, and a firm’s own matter management data, for starters — to bring order to chaos while drawing insights and discovering trends.

Legal analytics tools help lawyers make data-driven decisions when devising legal strategies. But how does this process apply to the nuts and bolts practice of law?

Infographic: How Attorneys Guide Litigation Strategy with the Help of Legal Analytics

Now that we’ve covered the what of legal analytics, it’s important to touch on the where. In short, analytics derive from litigation data. That data, which can play a crucial role in all facets of legal practice, can be extracted from multiple sources including court dockets and a firm’s matter management data. Court data and filings can help legal professionals gain important and helpful insight about litigants, their attorneys, judges, expert witnesses, and more. More specifically, litigation data can include:

  • The types of cases a judge usually has before them
  • How a judge handles expert challenges
  • Outcomes of similar cases
  • Appeals rates
  • A law firm’s prior litigation history
  • A firm’s past billings
  • How active an attorney has been
  • Who an attorney has represented
  • How active an attorney has been
  • Expert witnesses’ involvement in past litigation

Law firms use legal analytics in a variety of ways, often depending on the size of the firm and areas of practice. Although the methodology may seem complex, the goal is simple: allow lawyers to make informed, data-driven decisions to maximize their success. When lawyers have questions, legal analytics can help them better arrive at the answers with predictions based on data. Here are four practical questions legal analytics tools can answer to help attorneys make their practice more profitable and efficient.

Does it make sense from a financial standpoint to take this case?

Attorneys face a never-ending stream of decisions not just about individual cases, but also how those cases impact their practice as a whole. Perhaps the only decision more important than which cases to take is which cases not to take.

By using litigation analytics tools, law firms can weigh the likely costs of a case (including experts, outside counsel, and discovery) against the potential financial reward. While seemingly counterintuitive, it may make sense to take a case with a lower potential ceiling because the up-front costs may be significantly lower. Firms can use this data to decide which cases make the most sense given their current caseload and financial situation.

What is the probability of a certain motion outcome?

Any litigator knows that identifying when to make certain strategic moves is a critical element of success. But determining if or when to file a motion or other procedural steps too often amounts to little more than guesswork and intuition.

Using legal analytics tools, lawyers can rely on hard data to help manage key strategic decisions throughout the litigation process. By analyzing immense amounts of data, legal analytics can provide guidance based on the nature of the motion, the jurisdiction, the judge, opposing counsel, and a variety of other factors. Legal analytics allows lawyers to supplement gut instinct with significant data to outmaneuver the opposition.

How much of a settlement award is likely in this case?

The first question a client asks their lawyer is almost always, “How much do you think I will get?” Knowing the probable amount of a settlement can be both incredibly important and extremely tough to determine. While a lawyer can generally calculate a rough estimate of the high and low end of the spectrum based on basic information, finding the sweet spot is much more challenging.

By using legal analytics tools such as arbitration award analytics, law firms can determine a much more precise estimate of a likely settlement for a specific case. This information is immensely valuable when it comes to advising clients whether to accept an offer or keep fighting, especially because clients often overestimate the value of their case.

How long will it take for this case to be resolved?

Usually the second question a client asks their lawyer is, “How long is this going to take?” Unfortunately, the client rarely likes the answer because in most instances, there is no real answer. And when a client pushes for an estimate, they often hold the lawyer to that number — even if they promise not to — which creates pressure and potential friction in the attorney-client relationship.

By turning to legal analytics, lawyers can gather invaluable insights into how long their case may take based on the cause of action, jurisdiction, judge, opposing counsel, and other data points. Not only will this information allow law firms to plan and allocate precious resources, but it will also help avoid unrealistic client expectations.

The advantages of legal analytics tools sound impressive, but do lawyers really use them in their practices? Data shows that the answer is a resounding yes.

In December of last year, Lexis and ALM Legal Intelligence conducted a survey of 163 large law firm professionals in the United States to better understand the adoption, application, and value of legal analytics. The survey found that 70 percent of firms use legal analytics and 73 percent of respondents at firms with access to legal analytics tools use them directly or indirectly. Use of these tools will likely grow too, considering 92 percent of respondents plan to increase their use of legal analytics in the next 12 months.

Legal analytics users find great value in the tools they use. Nine out of 10 respondents agree that using legal analytics makes them a better and more efficient and effective legal practitioner. Nearly all respondents (98 percent) say legal analytics improve their performance and 81 percent say they are encouraged or looked upon favorably by clients because their firm has access to and use legal analytics tools.


Conclusion

Legal analytics tools are indispensable for any law firm seeking to maximize productivity and profitability. Running any business requires a multitude of decisions. At any law firm, every decision can have an outsized impact, sometimes with unintended outcomes. By joining the increasing group of law firms who use legal analytics tools, lawyers can ensure they make informed decisions that will take their practice to the next level.