Arbitration predictions start-up trains sights on UK

Yang: Service helps with stressful decisions

A lawtech start-up using second-generation artificial intelligence (AI) to give international arbitration specialists an edge when predicting how best to approach high-value cases is planning to enter the UK market.

ArbiLex’s founder, Isabel Yang, said her aim was to make top international lawyers more comfortable with high-stress decisions over such things as the tribunals they chose, by providing an empirical basis to test out assumptions as they juggled options over strategy.

The company has two products: an online analytics platform and a bespoke predictions report.

The first it described as “making accessible in seconds insights that would otherwise take up hundreds of associate hours to produce”, while the second supports “high-impact decision making with data science and AI modelling tailored to the unique attributes of a given case”.

The fledgling company, headquartered in Cambridge, Massachusetts, in the US, has already played a role in cases with a value totalling $3bn (£2.4bn) and is working with the London offices of US-based global law firms.

Ms Yang, a Harvard Law graduate, told Legal Futures the UK was “definitely on the radar” because London was possibly the number one hub for international arbitration and she had studied at Oxford University. She always looked “for every opportunity to go back to the UK”.

She said she had spoken to Allen & Overy, among others. She described the lawtech environment in the UK as “very vibrant” and said there was “a lot more acceptance of legal tech in the UK compared to the US”.

She said the raison d’être of ArbiLex was to allow arbitration specialists “to empirically test the assumptions and hypotheses about how a case is going to go” by providing “a platform and an array of tools” for them.

“Even if you have attorneys who have been in the business for 30+ years, making decisions as to which arbitrator to appoint and how to advise their clients when they have cases with billions of dollars at stake, reading the crystal ball is a very stressful process.

“Having an additional tool… helps them to feel a little bit more comfortable about their judgement and gives them a little bit more information to make that call – because it is a huge call.”

The technology behind ArbiLex was an advance on ‘conventional’ AI, making it a “second generation AI start-up”, she explained: “We follow a sub-discipline within AI that deals a lot with probabilistic modelling…

“If you think about the evolution of AI, initial applications have always focused on a massive amount of data, automation and machine driven modelling. I think over time a lot of automation has led to unintended consequences of ‘bias in, bias out’, ‘garbage in, garbage out’.”

She said the company approached the problem differently. “We kind of reverse the first-generation AI, to say that we before we even test the data we want to understand the underlying causal mechanism.

“The way we do that is we work with lawyers to really break it down; how do they think about the case, the different pieces of their strategy, what are the causal linkages between those considerations?”

She added: “The industry has moved towards the place where we demand a little bit more explainability in AI in the underlying model…

“We really wrestle with the idea of causal inference… and trying to incorporate subject matter expertise into the algorithm before we even test it out on the data.”

In spite of a heavy reliance on technology to assist decision-making in ArbiLex, Ms Yang said she believed that in a future era where digital ‘smart’ contracts were the norm and brought both “efficiency and information” to disputes, human judges or arbitrators would continue to be preferred, especially in high-value disputes.

“There is something personal about the justice system and there is something about being able to connect on a human level.

“So I think that, [while] the smart contract is the way forward and a welcome step, I doubt that will completely wipe out the human-based adjudication…

“I think as technology progresses the overall trend will always be… commoditising a lot of the services… but when it comes to issues of justice there will always be a place for human connection and the empathy that is uniquely human.”

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