Legal-tech takes wing with new breed of firms revolutionising services

With products such as digital document-filing and automated trademark management, a new breed of firms is revolutionising the legal space

On March 31, the insolvency resolution process of Chennai-based Orchid Chemicals and Pharmaceuticals had to be immediately executed. A nationwide lockdown was in place, and a delay in completing the documentation and executing the transaction would have wrecked the balance sheets of several creditors, including Dhanuka Lab (the resolution applicant), since it was the last day of the financial year.
 

However, thanks to Leegality — a document workflow platform that helps businesses digitise and automate paper-based processes — the Rs 1100-crore resolution plan was executed through the Aadhaar eSign gateway with a set of 22 creditors in a matter of hours. All 22 received their money, and Dhanuka Lab’s plan was successfully implemented.

The Gurugram-based technology startup, which counts banks and non-banking financial companies among its 400-plus clients, has since completed multiple big-ticket deals.
 

Says Leegality co-founder Sapan Parekh of the hitherto tech-averse Indian legal sector: “The pandemic and the lockdown helped in the rapid adoption of digital documentation. We have seen a spike in adoption by business and legal teams of enterprises across sectors, while the courts are now implementing digital filings and virtual hearings.”
 

Companies can collect signatures within seconds from customers, employees and business partners across geographies through the platform. They can choose from a variety of legally enforceable eSign options (see box). Customers can also affix stamp papers digitally to comply with stamp duty requirements.

 

The parties receive an audit trail for every signed agreement, making enforcement trouble-free. If a company has an internal application or software, it can be integrated with Leegality’s application programme interface.

After eSigning, an electronic copy bearing the digital signatures of each signatory is immediately sent to each party for safekeeping, mere seconds after execution. The solutions are fully compliant with the Information Technology Act and the Indian Evidence Act.
 

Leegality is trying to create paperless transactions in areas where technology penetration is low. As a result, the onboarding process charge for micro-finance lenders can drop to under Rs 20, from the current Rs 300 per transaction.
 

The technology is not restricted to e-signing. It facilitates digital filing of legal documents (which is now mandatory), virtual hearing of trials and live telecast of proceedings, which have become important owing to the pandemic.
 

Furthermore, lawyers are making a beeline for startups in the legal space that are making their and clients’ lives easier. Take Gurugram-based MikeLegal, an artificial intelligence (AI)-powered platform that significantly eases the effort needed to manage intellectual property (IP)-related tasks.
 

One of the startup’s products, MikeTM Search, automates the process of checking similar-looking trademarks and brand names through AI and advanced algorithms. Another, MikeTM Watch, automatically analyses journals every week to detect potentially infringing trademarks. The two-week process can now be completed in hours.
 

The startup has built a word-to-vector analysis to train algorithms for better prediction. It is also building an image-recognition software to identify similar-looking logos.
 

“A lot of law firms and corporates were manually managing their trademarks. It’s a time-consuming activity,” explains MikeLegal co-founder Anshul Gupta. “They are now looking at efficiency, and drive revenue from smaller teams, as hiring has been frozen due to the pandemic.” The company says business has grown 40 per cent over last year.
 

MikeLegal works with over 100 companies, and a handful of leading law firms. It is also in the process of launching a product that automates the proofreading of contracts. “It is a repetitive, mundane and manual process and is extremely important. But it is non-billable. By automating it, law firms can drive significant efficiency in the contract-drafting process,” Gupta adds.
 

Legal-tech is still at a nascent stage in India. Though startups are springing up in this sector, it has not yet seen the kind of foreign capital that is visible in edtech or the e-commerce space. Legacy law firms are, however, filling the gap.
 

Last year, leading law firm Cyril Amarchand Mangaldas (CAM) set up its Prarambh incubator, to support domestic talent in developing quality legal-tech products, and enhance interest in technology adoption among the legal fraternity.
 

AI startup Legal Mind, spawned by Prarambh, has launched a platform that derives insights from court judgements and helps in search tasks through a chat-box. The platform helps lawyers uncover patterns from case laws, enabling them to make data-driven decisions.
 

“Through the platform, you could analyse the past rulings of a judge and predict, to some degree, which arguments he or she is more likely to side with,” says Anubhav Mishra, founder and chief executive officer of the New Delhi-based startup.
 

Prarambh offers mentoring by legal experts, help in product development, and access to clients. CAM does not invest in these startups but retains a right to invest later. “Sometimes, we or our clients become customers of these startups,” says Komal Gupta, who heads CAM’s AI and innovation team.
 

Canada-based legal technology company Clio estimated in 2019 that an average lawyer submits just 31 per cent of an eight-hour work day toward billable work. It is non-billable work that most legal-tech startups are aiming to reduce.
 

With inputs from Yuvraj Malik