THE BLOG

Mind the Gap: Bending the Cost Curve of Legal Services to Close the Justice Gap

06/09/2015 04:38 pm ET | Updated Jun 09, 2016

The "Justice Gap" -- the fact that 80 percent of low-income and 50 percent of middle-income Americans face their legal problems without a lawyer -- undermines the promise of equal justice under law. One of the main reasons for this gap is that the cost of a lawyer to handle even a straightforward legal issue can be prohibitively expensive for many. One way to close this gap is to increase funding for non-profit legal services for low-income people. In that area, though, we're going backwards. Over the last few years, Congress has slashed the budget for the federal Legal Services Corporation, the entity that funds legal aid organizations across the country, by 30 percent. Another way to narrow the justice gap is to make legal services more affordable. And one way to do that is by innovating in the manner in which legal expertise is delivered. More and more, such innovation in the supply chain of legal services is being made possible through new technologies. But, like with all innovation, any revolution in the legal services supply chain is risky.

What made Walmart the global retail giant it has become, and iTunes the ubiquitous music delivery system that has helped make Apple the largest company in the world, is that both revolutionized different types of supply chains. Walmart developed its just-in-time method for restocking its shelves to keep prices low, and Apple created the iPod, which gave customers "1,000 songs in their pocket," all of which they would buy through iTunes. Supply chain innovations helped make these industrial giants who they are, and it is similar innovation in the supply chain of legal services that might help make legal services -- and services that look a lot like legal services -- more affordable.

In recent years, as Netflix has broken the mold in the movie rental business, and Uber and Lyft are changing the taxi industry, entities like LegalZoom and Shake are changing the way many individuals and businesses are accessing legal information, if not legal services per se. These companies market themselves directly to consumers, mostly through the Internet, and help individuals and businesses do things like form corporations, enter into standard-form contracts, and execute simple wills. They do this mostly through the creation of "one-size-fits-all" documents that are costly to generate once, but can be replicated over and over. Even big law firms are getting into the act, providing their clients with standardized legal forms and guidance outside of the provision of traditional lawyer-client services.

One offering that combines information and access to actual lawyers is the Oh Crap App, a mobile application that provides a range of services to individuals who are having interactions with law enforcement, even in real time. The app offers information to individuals so that they will know their rights when having an encounter with the police, like at a traffic stop. It also has a blood alcohol calculator and a lawyer on demand feature that links a consumer to a lawyer, even if he or she is stopped on the side of the road.

Unlike these other services, which are taking their services directly to clients, eBrevia, a recent addition to the legal landscape, is serving lawyers, not clients, although it will likely help lawyers deliver legal services more efficiently and cheaply. eBrevia uses machine learning technologies to automate contract review and drafting. Through eBrevia's software, lawyers can search documents for key terms and prepare new contracts that are customized to each client's individual needs. The company boasts that it can accomplish these tasks in a fraction of the time it would take a lawyer to go through each document one-by-one. As a result, this technology could cut the cost of providing such services considerably, and these are savings that can be passed on to the consumer.

On the non-profit side, technology is helping get legal information to consumers. LawHelp.org is a network of websites in each state that helps residents find free legal information and legal assistance in their area on a range of legal matters, from eviction prevention assistance to help obtaining Social Security benefits. Recently, Albany Law School, the Empire Justice Center and the State University of New York teamed up to create a free, on-line guide for homeowners facing mortgage foreclosure in New York State. This web-based interface helps homeowners understand the foreclosure process and gives them helpful tips on how they can represent themselves.

What most of these innovations don't do, however, is provide legal services. Instead, they are, for all intents and purposes, giving consumers the ability to help themselves. Often they do no more than fill out simple forms or give a consumer an understanding or his or her rights in a given setting. Look no further than LegalZoom's own website disclaimer, which reads: "We are not a law firm or a substitute for an attorney or law firm. We cannot provide any kind of advice, explanation, opinion, or recommendation about possible legal rights, remedies, defenses, options, selection of forms or strategies." So, while companies such as these are making access to some form of legal information less expensive, they are not a substitute for a lawyer, by their own admission.

The services delivered through these supply chain innovations may, to the lay person, appear to be legal in nature, but they are not legal services. What's more, they pose significant risks. Such innovations, when not coupled with a lawyer's guidance, could entice a person to obtain assistance from one of these non-legal entities that could lead them astray, jeopardizing their rights because the assistance provided was not tailored to that consumer's individual needs. Reading the fine print makes it clear that many of these online services do not even attempt to replace the services of an actual lawyer. The problem with such an approach becomes clear when someone is really in a legal jam and needs personalized services: i.e., when they don't fit into a one-size-fits-all box. Of course, legal services in such a situation are more costly than those one can obtain from an on-line document mill.

On the other hand, LawHelp and the Oh Crap App help link consumers to a lawyer should they need one. On the LawHelp side, the referral to a lawyer is no promise that the consumer will actually obtain representation. At best, LawHelp refers its end users to free legal assistance from non-profit organizations, and these organizations often turn away many more prospective clients than they can handle, simply for lack of adequate funding.

While making legal services more affordable -- and more available -- may be possible through innovations in both technology and the supply chain of legal services, we may not be there yet. Perhaps eBrevia is an example of the cutting-edge; it shows where innovation can be most effective in terms of bringing down the cost of legal services, while not serving as a substitute for an actual lawyer. Such savings, in turn, can be passed on to the consumer.

What supply chain innovations can do to the delivery of legal services is maybe make it possible for innovative lawyers to provide services to the public in a less costly fashion. Such innovation might help narrow the justice gap by making legal services more affordable. But until such innovations are coupled with actual lawyers providing actual legal services to clients, and technology helps those lawyers deliver legal services to clients in a more affordable fashion, we will still have a considerable justice gap, and will fail to fulfill the promise of equal justice under law.