Jessica Williams, a veteran legal operations professional, is among those who think AI can help legal departments better manage outside counsel spending.

For example, she notes that in-house legal teams often have to review bills from law firms that have hundreds of line items. One goal of such examinations is to determine whether the firms spent a reasonable amount of time on the work at hand.

Williams said tools powered by the latest AI, and with access to historical data, could help in-house legal professionals much more efficiently and effectively identify a reasonable number of hours for specific tasks.

“I think that these are the types of areas where our AI can see those patterns and quickly identify them,” said Williams, the director of legal team strategy and operations at FanDuel.

Williams spoke during a recent webinar hosted by the Buying Legal Council focused on how in-house teams can save money on legal spend through using artificial intelligence.

Nuanced legal matters

Matt DenOuden, senior vice president of sales at legal tech provider Onit, elaborated on the point made by Williams. He highlighted that there are certain tasks such as change of venue motions for which it is pretty clear how much time it should take outside counsel. 

But he said AI proves its power when quickly reviewing data to identify what is a reasonable amount of time for law firms to spend on more nuanced legal projects such as preparation for a settlement conference.

“I think what the AI can do is to help with the not-obvious cases,” DenOuden said during the webinar.

Additionally, DenOuden said, AI can help legal teams determine whether the right law firm timekeeper worked on a particular task. 

This could include technology identifying whether an associate or paralegal should have handled a matter based on the legal department’s outside counsel guidelines.

Law firms

David Cambria, a fellow at the College of Law Practice Management, said corporate legal departments have traditionally been much more likely than law firms to adopt e-billing technology.

However, the rapid advances in AI may spur firms to consider implementing technology focused on legal spend, he said. 

One reason for possible increased interest in such tools is that AI could make it even easier for law firms to track the work they do and present it to legal departments, thereby improving the relationship between the two sides.

“Both the law firms and law departments at the same time here are seeing that this is an inflection point,” Cambria said during the webinar.

Invoice improvements

DenOuden also shared that law firms have largely moved away from using their invoices to meaningfully update clients on the work they have completed.

He said Onit has been testing large language models to see if they can help produce a summary of the work a law firm completed “so that the invoice again can actually be a communication device.”

The early AI testing results in the invoice realm were very promising, DenOuden said. This type of functionality could further entice law firms to implement legal spend management tools.

More innovation

The webinar panelists also noted that the rapid pace of AI developments in recent months means there will very likely be additional innovations in the weeks and months to come.

Williams said she looks forward to seeing how technological advances will further improve the procurement of external legal services and the monitoring of such spending.

“With this generative AI, not only do we have it on the actual legal practice side, but now we have it on the business of legal as well,” Williams said. “So we're going to see a lot of changes in the future, and I think most of them probably for the better.”