<nettime> Vice > Jason Koebler > Startup automating Peter Thiel's legal strategy

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< https://motherboard.vice.com/read/legalist-is-automating-the-lawsuit-strategy-peter-thiel-used-to-kill-gawker >

A Startup Is Automating the Lawsuit Strategy Peter Thiel Used to Kill Gawker

Written by
JASON KOEBLER

August 24, 2016 // 03:00 PM EST

Did you look at Peter Thiel's systematic destruction of Gawker via
the American legal system and think "Wow, it's too difficult to
extract money from corporations and people using the courts?" Did
you think, "Why don't I try that?" If you answered yes to either
question, there's a startup you should meet.

Legalist is a Silicon Valley startup that was developed in the Y
Combinator incubator offering "data-backed litigation financing"
using algorithms to "analyze millions of court cases to source,
vet, and finance commercial litigation." It's the latest in a
series of companies that allow third parties to "invest" in the
success of a lawsuit, by funding said lawsuit.

The idea is that, using historical lawsuit data, the outcome of a
lawsuit can be predicted before it's even filed. If you can
predict which lawsuits will succeed, you can ensure big financial
returns for people who invest in litigation. Similarly, to
increase the probability of a lawsuit's success, would-be
litigants should file their cases in districts with judges who are
notoriously favorable to that type of case.

For example, one-fourth of all American patent cases are heard in
one small district in Texas because it's easy to win patent cases
with the judge there. Legalist believes that it can similarly
Moneyball its way to competitive advantages for all sorts of
cases.

"One of the biggest predictors of case outcome is the presiding
judge and one of the biggest predictors of length is the number of
cases that judge is concurrently working on," Eva Shang, one of
the company's cofounders, told the Silicon Valley Business
Journal. Shang noted that currently, lawsuit investors return
about $1.40 for each dollar they invest; she thinks Legalist can
improve upon that figure. The company did not immediately respond
to Motherboard's request for comment.

In other words, the company is determined to disrupt the annoying
unpredictability of the American justice system. I say disrupt,
because it's planning on weaponizing weaknesses in the courts
system using historical lawsuit data as an investing opportunity.
In a sane world, an idea this crazy would either:

     A) Democratize the frivolous lawsuits that rich people, patent
     trolls, and other litigious types use all the time to extract
     wealth via the justice system.

or

     B) Force Congress to reckon with a court system that is highly
     broken and inefficient.

This being a not-so-sane world, perhaps a third thing will happen,
where more companies will, like Gawker, lose existentially
threatening court cases in a rigged legal system that are funded
by what are essentially uninterested parties. If this is the
outcome, then Legalist and its investors will get fabulously
wealthy in automating the third-party litigation financing
industry, which two senators recently called "largely unregulated
and operates with no licensing or oversight."

For a real-world example of how venue, judge, and third-party
funding can ruin someone's proverbial day, take a look at what
billionaire Peter Thiel just did to Gawker. Thiel, stricken with a
vendetta against the publication either because it outed him as
gay or because he didn't like Gawker's reporting on the insular
world of Silicon Valley, sought to destroy the company by drowning
it in litigation.

To increase his odds of success, Thiel's lawyer filed the case in
Florida, in a district that is notably favorable to Hogan and in a
district with a judge that has a history of getting decisions
wrong (many legal experts believe Gawker will eventually win its
case on appeal, which will be too late to save the company).
Making these decisions presumably required careful consideration
by a talented lawyer, a luxury few can afford. Legalist proposes
to automate these decisions with its algorithm.

The company said it doesn't want to enable lots of
would-be-Peter-Thiels, but even if the company's endgame is
focused on earning money and not personal vendettas, the
machinations and legal strategy are the same.

The underlying technology is interesting and potentially
useful -- founded by two Harvard undergrads, the company's original
plan was to scrape and upload state court records to a central
database, making it possible for lawyers, journalists, and the
public to search state court records, which are notoriously hidden
behind paywalls, are difficult to access, and are often stored on
hard-to-search websites.

As recently as last month, the startup was content to become the
"Lexis Nexis for state records," a service that would make
fragmented state court records "more accessible and transparent."
Instead, its chosen a course of action that's far more anarchic
than I would have believed possible, given its original mission.

The company -- which is already taking "applications" from would-be
litigants -- will automatically determine where, when, and with what
judge to file a lawsuit, turning the American justice system into
little more than computer programming problem. Naturally, Silicon
Valley's biggest venture capitalists love the idea.


	Marc Andreessen ✔ @pmarca
	Now THERE'S an idea. Wow.
	https://twitter.com/pmarca/status/768364686072885249
	4:29 AM - 24 Aug 2016

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