Lex Machina: 10 years of Legal Analytics

Karl Harris, CEO In 2006, Stanford Law School professor Mark Lemley was looking to answer a seemingly simple question: “Where is the best place to file a patent case?” To his dismay, he was unable to find even the most basic empirical information to support his research. Little did he know that his efforts to answer that seminal research question would set off a sequence of events leading from the creation of a public interest database to a venture-backed Silicon Valley startup that was eventually acquired by legal industry giant LexisNexis. Along the way, Professor Lemley did answer his question in his 2010 paper titled “Where to File Your Patent Case”. Spoiler alert: as Professor Lemley put it, “I’m going to Disney World.”

The Stanford Intellectual Property Litigation Clearing House

To get started, Lemley teamed up with practicing lawyer Joshua Walker, technologist George Gregory, and the Stanford Computer Science Department to build the Stanford Intellectual Property Litigation Clearinghouse (IPLC). With a mission to bring openness and transparency to patent litigation, the IPLC offered a searchable database on all U.S. patent cases filed since 2000, and allowed lawyers to research factors influencing outcomes in patent litigation. In less than a year, the IPLC had secured funding from leading corporations like Intel and global law firms such as Fenwick & West, and over 5,000 users had signed up.

A Silicon Valley Startup

It soon became clear that the Stanford IPLC could be more than an academic research project - the database also had tremendous commercial value. So, on January 5, 2010, Stanford Law School announced the launch of Lex Machina, a private company formed to develop a robust and scalable version of the IPLC database, which had grown to over 100,000 cases. With Walker and Gregory as cofounders, this endeavor required building a team of legal data experts and software engineers. Attorney Carla Rydholm joined in 2010 and software engineers Nick Pilon and Gavin Carothers joined in 2011, all three of whom are leaders on the Lex Machina product team to this day.

By 2011, Lex Machina had raised a seed round of financing and attracted a growing number of well-known law firms and corporate legal departments as paying customers. To accelerate the business even faster, Josh Becker, a veteran of the software and venture capital industries, came on board as CEO. Also joining Becker were legal veteran Owen Byrd to build sales and marketing, and tech entrepreneur Karl Harris as CTO and Vice President of Products. Together, they raised a $4.8 million round of venture funding to expand the sales team and build the product to support their vision for the future.

In October 2013, Lex Machina launched Legal Analytics® - a completely rebuilt software platform defining a new industry category. Its insights allowed lawyers, for the first time, to anticipate the behaviors of judges, law firms, attorneys, and parties in patent litigation. It leveraged cutting-edge natural language processing and machine learning technology to read, clean, and tag millions of pages of legal information. The platform was a tremendous success, adoption grew rapidly among patent lawyers, and through it Lex Machina ushered in a new era of data-driven lawyering. Lex Machina helps you win. It helps you win business and it helps you win cases.

Bigger than Patent Law

Following its success in the patent space, under Harris’s product leadership the company proceeded to launch Legal Analytics® modules for copyright and trademark, rounding out its coverage of intellectual property litigation. Shortly thereafter, to meet ever-increasing customer demand, the company expanded its vision to include bringing Legal Analytics to all areas of the law. Legal industry giant LexisNexis was also excited about Lex Machina’s vision for the future, and on November 23, 2015, Lex Machina was successfully acquired by LexisNexis.


Lex Machina helps you win. It helps you win business and it helps you win cases

LexisNexis Acquisition

By combining Lex Machina’s outstanding team and advanced technology platform with the world-class content of LexisNexis, Lex Machina greatly accelerated its pace of expansion, releasing litigation analytics modules for antitrust, securities, employment, contracts, product liability, insurance, and more. CTO Karl Harris became CEO of the stand-alone business unit in 2018, and Lex Machina counts many of the largest law firms and companies in the world as customers. Now in 2020, Lex Machina is fulfilling its mission for federal civil litigation, having grown its database to 25 times the size of the original Stanford IPLC database to cover over 2.5 million federal cases and over 80 million related docket entries. But perhaps most exciting is what’s coming next: state courts. Following its successful launch of state court modules for the Delaware Court of Chancery, Los Angeles County, and Harris County, Lex Machina plans to bring its industry-leading approach to analytics to state courts across the United States.

Legal Analytics® is now 10 years old, and in that time the technology has changed the way law is practiced. Legal Analytics® provides the winning edge in the highly competitive business and practice of law.

“Lex Machina’s efficient use of big data for screening law firms, and then managing litigation strategy, is one of the top three—if not the—most significant development in US litigation practice since I began my career in 2001.” Steven Geiszler, U.S. Chief IP Litigation Counsel, Huawei.

Painting the Bigger Picture

“Imagine you get a call from a client looking to sue a company for contract breach. Within seconds, Legal Analytics can provide you and your client with enough relevant information to determine whether such a lawsuit makes sense,” said Karl Harris, CEO of Lex Machina. “Diving deep into litigation data can show you insights like how often this party has been sued and how similar contract breach cases fared with a particular judge, allowing you to anticipate case resolutions, case timing, damages awarded, and more. Before Legal Analytics, achieving this level of insight could take a team of highly paid legal professionals days or even weeks, with neither the accuracy nor the depth that today’s advanced technologies can provide in mere seconds.”

“Unless you know about the possible outcomes for a proceeding, you cannot design a winning formula for success in the legal space”

If the case moves forward, Legal Analytics can present critical insights into the behavior and track record of the opposing law firm and its lawyers, showcasing their success rates in contract breach cases both on the plaintiff and defendant side. You will see how long similar contract breach cases have taken in your particular venue, in front of a particular judge, and against the company your client is looking to sue. You can learn at what point the cases were terminated, such as at summary judgement or trial. Last but not least, the data can illuminate potential damages that have been awarded in similar cases so you can weigh the potential risk against a possible windfall. Timing and damages data are critical for lawyers to estimate how much a legal matter might cost.

Legal Analytics also helps to inform your motion strategy. For example, if it costs $100,000 to craft and litigate a motion that has a 29 percent probability of success, you can make a data-driven decision to proceed with that approach. However, if the data shows that your judge frowns upon excessive pre-trial motions, you can avoid squandering your client’s resources and save them for the trial.

There’s an App for That!

For some lawyers, sorting through litigation data, playing around with different variables, and uncovering different potential outcomes can be quite addictive.
 
But for those who need quick and easy answers to common litigation questions, Lex Machina has built the industry’s only set of Legal Analytics Apps. Think of an App as the “easy button” for Legal Analytics. Among others, it boasts a suite of Comparator Apps that enable users to directly compare the performance of law firms, judges, or parties. Likewise, the Damages Explorer App allows users to assess various circumstances under which damages are being awarded.

“Lex Machina’s efficient use of big data for screening law firms, and then managing litigation strategy, is one of the top three—if not the—most significant development in US litigation practice since I began my career in 2001”

“When lawyers draft motions for summary judgment, our Motion Kickstarter App shows examples of motions that worked and motions that did not, which is a great place to get started. The Attorney Team Analyzer App highlights how a team of attorneys handling a case has performed together in past cases. By comparing their performance data, our customers can find attorneys that they want on their teams,” adds Harris.

Other Use Cases for Legal Analytics

Lex Machina focuses on outcome analytics - what happens in cases like yours - something that no other product specializes in. “Unless you know about the possible outcomes for a proceeding, you cannot design a winning formula for litigation success. That is something unique to Lex Machina,” says Harris.



A major use case beyond winning cases is winning new clients and retaining existing ones. If you know the other firms competing against you for a particular legal matter, Legal Analytics can identify areas of weakness that could be exploited. In one example, a mid-sized firm in a new business pitch leveraged Legal Analytics data to illuminate the actual caseload of a larger competing firm. When the prospective client realized that the competitor might be too busy to provide the high-touch experience they required, they went with the smaller firm.

Many enterprising users have found alternate uses for the insights derived from litigation data. Harris says that both law firms and corporations use Legal Analytics for hiring purposes. That’s because the data looks past the person, their CV, and polished sales pitch and focuses exclusively on their past performance and experience. This level of transparency helps hiring managers truly find the best, most qualified, and experienced candidates.

In another example, a mid-size regional firm used Legal Analytics to learn that an existing client was gradually shifting more routine employment disputes to a big national firm. Armed with that knowledge, the firm quickly negotiated a favorable fee agreement with the client, preserved the relationship, and even expanded the caseload with that client.

Legal Analytics - Here to Stay

Lex Machina’s journey from a small venture-backed start up in 2010 to its position in 2020 as the leader of the Legal Analytics movement demonstrates how quickly and profoundly data-driven decision-making has transformed the business and the practice of law in the United States.

“We created the concept of Legal Analytics and perfected it across the full spectrum of federal civil litigation, and in doing so have brought greater transparency to the legal system. The focus of the company now will be to launch Legal Analytics for state courts,” adds a passionate Harris, narrating the technological milestones that Lex Machina plans to surpass.

The challenges will be greater, due to the differences between electronic filing systems that vary state by state and county by county. That said, the demand for Legal Analytics at the state level is extraordinarily high and Lex Machina is ready and willing to embrace the challenge to keep bringing technology and innovation to the legal space.

Lex Machina News

Lex Machina Launches State Law Modules, Extending Its Groundbreaking Legal Analytics to State Courts in California and Texas

MENLO PARK, Calif., Feb. 4, 2020 /PRNewswire/ -- Coinciding with the 10th anniversary of its award-winning Legal Analytics® platform, Lex Machina, a LexisNexis company, today announced an exciting new expansion into state court analytics. Consisting of more than 870,000 cases in Los Angeles County and Harris County (Houston metro area), the new modules give practitioners critical insights about judges, courts, law firms, individual attorneys and parties in state courts. By leveraging its Attorney Data Engine and other natural language processing technology, Lex Machina is the only legal analytics provider able to utilize state court documents to provide comprehensive coverage about the behavior of judges, law firms, attorneys and parties in state courts.

Lex Machina is solving an immense technical challenge by taking complex, unstructured data and utilizing its software to allow practitioners to make data-driven decisions, develop winning case strategies and win new business in brand new state court venues. Because there is no unified system for state courts analogous to PACER in federal courts, Lex Machina will add its new State Court modules on a court-by-court basis, with an emphasis on strict data quality and integrity to ensure that legal professionals have access to the most complete, comprehensive and accurate analytics available.

Lex Machina worked closely with the court systems to understand their docketing practices and create analytics that reflect the unique aspects of individual courts. For example, the three new state courts – Los Angeles County Superior Court (615,000+ cases), Harris County District Court (175,000+ cases) and Harris County Court (80,000+ cases) – each have their own data collection infrastructure and nuances. The new modules, and thus the substantial case numbers, cover four years of court activity beginning with cases filed January 1, 2016 or later.

The Los Angeles and Houston courts were selected for the initial release because they represent important data sets to understand the overall process of developing state court analytics. Los Angeles County Superior Court is the largest state court in the nation by volume. Harris County encompasses a large metropolitan area and is part of Texas' two-court civil system, with the Harris County District Court of general jurisdiction and Harris County Court of limited jurisdiction. Lex Machina developed relationships with these three courts and was able to gather feedback from users practicing in Los Angeles and Houston. Lex Machina plans to expand its state court coverage to a dozen U.S. state courts in 2020, including many major metropolitan areas.

"It's an exciting technical challenge to responsibly expand our coverage to include complex analytics for state courts, where even basic information such as who was involved in the case is buried in millions of pages of court documents. Electronic filing systems across states and districts are unique to individual courts, so structuring and normalizing the data to make it usable and reliable is notoriously difficult," said Karl Harris, Lex Machina's CEO. "In spite of these obstacles, we've now laid the foundation to bring Legal Analytics to state courts all over the country, and customers familiar with our interface for federal courts will see that our state court modules work similarly. This is an incredible accomplishment."

Lex Machina gathers raw information from state court cases, including downloading millions of state court documents to present the most comprehensive and accurate data possible. The company cleans, tags, codes, enhances and presents the resulting data in a way that makes it easy for users to quickly access insights and grasp trends that are relevant to the legal matter they're working on. Whether simply searching for a case or looking for more in-depth analytics, practitioners can investigate a party's litigation track record, assess a law firm's experience in similar cases, observe patterns in judicial decisions, examine the range of damages awarded at trial or search docket entry text.

Both new and existing Legal Analytics users will appreciate the easy-to-use interface that lets them access a wealth of new state court features including:

• Searching by judge, law firm, attorney name or party

• Timing analytics, trial resolutions, trial damages and trial rulings

• Keyword searching within docket entry text and downloaded documents

• Viewing analytics across all state courts or in one particular court

• Court-specific filters, such as case types and case tags

Company
Lex Machina

Headquarters
Menlo Park, CA

Management
Karl Harris, CEO

Description
Legal Analytics helps to inform your motion strategy. For example, if it costs $100,000 to craft and litigate a motion that has a 29 percent probability of success, you can make a data-driven decision to proceed with that approach. However, if the data shows that your judge frowns upon excessive pre-trial motions, you can avoid squandering your client’s resources and save them for the trial. Lex Machina focuses on outcome analytics - what happens in cases like yours - something that no other product specializes in. “Unless you know about the possible outcomes for a proceeding, you cannot design a winning formula for litigation success

Lex Machina