LAWTECH: Greenline Legal crunches contracts in the clouds

By: RON PHILLIPS//October 13, 2011//

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Most software designed for law offices helps make attorneys and staff more efficient in tasks like scheduling, storing, finding, organizing, billing and communicating. Like a bicycle, these tools amplify our strengths and help us accomplish more in less time. There is a whole new class of software on the horizon, however, that can help attorneys with more complex analytical work.

Greenline Legal, a startup software company in Seattle, is offering a cloud-based solution that could change the way you review contracts.

I recently had the opportunity to spend some time with Greenline’s founder Ehren Brav. Brav, an attorney, worked in a New York City law firm’s mergers and acquisitions department. His role in contract negotiations usually involved repeatedly poring through contract revisions, comparing changes and looking for specific clauses and language. It wasn’t particularly fulfilling for him, nor did his clients enjoy the high cost of contract review.

“It is important work, but tedious work,” Brav said.

Sensing opportunity in his frustration, Brav began research to validate the market for software tools to assist in contract review. He initially focused on annotating contracts to flag potential problems, but as he interviewed prospective users he discovered an unmet need for tools to identify and compare relevant language in a contract and its precedents so that the attorney could complete the markup.

The result is a pretty impressive piece of technology. The Greenline system employs machine learning to train the software to recognize lexical patterns as specific provisions in contracts. For example, the Greenline team has trained the system to recognize over one hundred different provisions in software license agreements. It’s currently in beta (pre-release), but even in this early stage its foundation is promising.

The system can be used to summarize a particular contract into its constituent provisions, or to compare a contract revision against a baseline. To summarize a contract, first choose a contract document, and then select the contract type. Next, choose the particular provisions that you want Greenline to look for, or simply let it look for all the provisions it can recognize. When it is done with the analysis, Greenline generates a table that identifies each provision along with the specific language for that provision.

I tested Greenline’s summary analysis with a sample license agreement. I configured the analysis options to look for all provisions that it could recognize, and to identify the provisions that it couldn’t recognize. The resulting table of provisions and language correctly identified the language for the agreement’s essential provisions (for example, choice of law, confidentiality, export laws, warranty).

In addition, it successfully identified “hidden” warranty language and terms that appeared outside the warranties section. The technology is not perfect, though — there were several unrecognized contract provisions that I expected the system to classify (this may indicate areas where the system’s machine training is not yet complete).

Comparing contracts works much the same. First choose a baseline contract document, and then add one or more subsequent revisions. Choose the provisions you want Greenline to analyze. Greenline generates a table that shows each contract provisions, side by side.

I tested contract comparison by choosing four different contracts, and chose “Choice of forum” as the provision I wanted to compare. Greenline found the choice of forum language in each contract and presented them in a table, side by side.

The Greenline system is still in development with more features coming. It is currently trained to analyze commercial leases, corporate charters and bylaws, employment agreements, license agreements, invention assignments, non-disclosure agreements and Series A term sheets. More types of contracts are no doubt in the wings. Nonetheless, the core Greenline platform demonstrated capable analysis of contract documents. It identified “hidden” contract language and correctly extracted “similar clause” language from disparate contracts.

Brav indicates that Greenline, when released, will be available on a monthly subscription basis.

Pricing information was not immediately available.

Ron Phillips is a self-described attorney-computer nerd with more than 15 years of experience as a software architect and technology entrepreneur. He has helped to design and build enterprise systems for large and mid-size corporations, developed commercial software products and authored several books and articles concerning software development, applications and technology. He enjoys helping fellow attorneys with their technology questions one-on-one and on the Practice 411 forum, and looks forward to sharing his technology perspectives in this column. You can reach Ron at [email protected].

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