David Fisher talks about what blockchain is and its application in the legal industry.
Law Technology Now
David Fisher is the founder and CEO of Integra Ledger, a permissioned blockchain for the global legal...
Bob Ambrogi is a lawyer, legal journalist, and the publisher and editor-in-chief of LexBlog.com. A former co-host...
Blockchain has recently emerged as one of the technologies that will most change the way lawyers practice law and yet a lot of people still don’t fully understand what blockchain is. In this episode of Law Technology Now, host Bob Ambrogi talks to David Fisher, CEO of Integra Ledger, about what blockchain is and its application in the legal industry. They discuss the benefits to using blockchain including having data security, your own digital identity, and maintaining integrity in documents like contracts, signatures, and more.
David Fisher is the founder and CEO of Integra Ledger, a permissioned blockchain for the global legal industry that facilitates secure and efficient interoperability among law firms and their clients.
Law Technology Now
Changing the Legal Game with Blockchain
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Bob Ambrogi: Welcome to Law Technology Now. This is Bob Ambrogi. Joining me today is my guest, David Fisher, Founder and CEO of Integra Ledger. Welcome to Law Technology Now, David.
David Fisher: Hi Bob. I am glad to be here.
Bob Ambrogi: Well, I am very glad to have you. And we’re going to be talking a little bit today about I think some concepts that may be still foreign to some of our — some of our listeners, so I may, I may get very elementary with you David here today. And I hope you can help us with that, but before I start talking about, we’re going to be talking about blockchain and its application in the legal space.
Before I do that, let me just ask you to tell us a little bit about your own background.
David Fisher: I am a lifelong entrepreneur, going back to when I was 17-years-old and running ice cream parlors full time while I was still in high school. So, I guess that’s where I got the entrepreneurial bug, and from there I’ve never lost it.
So I’ve owned multiple companies in various industries. I have utilized many, many attorneys along the way, many large law firms. In fact, one of my co-founders would refer to me as a professional client. So that actually positioned me to do what I’m doing today, which is working to innovate in some of the fundamental ways that the legal industry interoperates securely.
Bob Ambrogi: So you’ve recently, I think recently, founded something called Integra Ledger, tell me about what that is.
David Fisher: So Integra Ledger grew out of a project that started about two years ago to build a platform for law firms and clients to collaborate more efficiently, more securely, and as I said, I’m a long time client. So it’s something I’m very passionate about, because I know what it’s like to be on the receiving end of legal services.
And so, going back a couple years, one of my law firms asked me to provide feedback, provide advice on how they could improve client service, that led to a project, it led to a company actually. That developed a — really a cutting-edge collaboration platform for law firms and attorneys.
Bob Ambrogi: That was CaseShare, not CaseShare?
David Fisher: ClearLegal.
Bob Ambrogi: ClearLegal, I am sorry really.
David Fisher: Which became Privātim.
Bob Ambrogi: Yeah okay.
David Fisher: So that received widespread enthusiasm and acclaim from predominantly large law firms, large corporate in-house legal departments. What we discovered in doing that was that as much as the functionality of the front-end the UX, so the operational aspects of it for attorneys and clients, was terrific. There was still the backend issue of data security, and it’s something that lawyers and law firms wrestle with every day frankly.
Bob Ambrogi: Right.
David Fisher: And even more so as we hear about more hacks and more security vulnerabilities, so we discovered was that blockchain as a technology, almost as a technology paradigm, could be an answer for not just a law firm or a company, but the entire legal ecosystem to bring much greater security, data integrity and ultimately productivity to the legal ecosystem.
That led us to launch Integra Ledger, which really is a service, almost utility for the global legal industry, very foundational infrastructure designed to empower all the other stakeholders. So it’s software companies, law firms, corporate legal departments, you name it, all of them to utilize that foundational blockchain infrastructure which we call Integra Ledger to build new more secure, more efficient legal applications. So we think this is an empowering technology for the entire industry.
Bob Ambrogi: So, well, I think a lot of our listeners, I hope have probably started to hear about blockchain, it’s been talked a lot about recently, but we tend to think of it or we tend to hear of it rather in connection with cryptocurrency. What does blockchain have to do with law firm security issues and the security of client data or anything else?
David Fisher: It’s probably one of my favorite questions. So blockchain technology really hit the scene with the emergence of Bitcoin. So for those of you’ve heard of Bitcoin, it’s a so-called cryptocurrency, without going into great detail, it solved what’s commonly referred to as the double-spend problem, which is — I mean if you think about a $20 bill or a $100 bill, it has certain security features to prevent you from photocopying it. You are in passing that off as a legitimate legal tender.
In the digital realm that’s much harder to do. You literally could take a Word file and copy it, and what Bitcoin invented basically is a system of distributed ledgers and hashing, so cryptographic hashing and a couple other technologies that created digital integrity for data. And if you could do that for currency and value, which is what Bitcoin proved, Bitcoin as a system has never been hacked, which is interesting.
And so this spontaneous development of a digital currency infrastructure never hacked, currently has a total market value of $63 billion as of today. We saw that and underneath it is this blockchain technology which made that possible.
Our insight was to see how blockchain and those fundamental technological underpinnings of integrity and trust in the digital realm could be applied to an industry that’s all about integrity and trust and that of course is law. I mean we want integrity and documents and contracts and signatures. And so we are taking some of the insights from the Bitcoin sort of currency application and applying them to the infrastructure of digital integrity for law.
Bob Ambrogi: So give me a practical example of that. I mean digital signatures, it is an application here in terms of how we now sign and validate documents in the legal space.
David Fisher: Yes. So the many, many companies are working on the notion of identity and blockchain based identity. Identity, as we currently think about it, really doesn’t exist with the individual, it exists with Google or Facebook or a potentially DocuSign or EchoSign. Various companies, various services that we subscribe to, but fundamentally our identities live on their servers.
Bob Ambrogi: In terms of what digital signatures you mean, or whatever —
David Fisher: We are just like who that person is.
Bob Ambrogi: Yeah.
David Fisher: So if you sign-up on for an account on Facebook. So it seems like your account but it’s actually an identity that Facebook owns, you are on Facebook, I mean this is part of the reason attorneys have issues with cloud computing.
Bob Ambrogi: Yeah.
David Fisher: Like who actually owns the data, who possesses the data. The same is true with identity, where is your identity, who is your identity. With blockchain, there’s an opportunity to have the identity actually reside with the individual.
So if you’re Bob Ambrogi, and you have a unique digital, blockchain based digital signature that’s only identified by you and there’s a public key which is the public manifestation of that, and there’s a private key which only you have, that means that whenever you sign with that private key, it’s confirmed to be you, unless you had given away your private key to someone.
What that means is in a blockchain world you could sign documents at different companies with different law firms, always with the same digital signature with no intermediary. So your identity doesn’t live with Google, it doesn’t live with DocuSign, it doesn’t live with anyone other than you.
And so what this is almost surely going to herald in law is a system where every individual, every corporate entity will have its own unique digital identity owned and controlled by that individual or entity, such that a fully interoperable signature ecosystem, if you will, without the need for special services.
Bob Ambrogi: I can imagine that identity would then begin to extend beyond signatures into, I don’t know, billing. I mean if it’s your identity and you’re a client working with multiple law firms that identity carries through those firms in terms of how they are billing you and invoicing you and I don’t know, tracking your matters, does it extend out in that way?
David Fisher: The way we think of this is that any unique attribute, any unique data model, and by data model you could be referring to a document, a contract, a clause in a document, a lawsuit, a matter, anything that’s unique and has a digital representation, can have a blockchain based identity and that’s the basis for the ecosystem that we’re standing up for the global legal industry.
So yes, if you can sign with the unique digital signature, the identity of the contract you’re signing can have its own unique identity.
The big counterpart is the other signatures have their identities and you start to see how we’re creating this web of trust or what we call a society of trust, where if everything can be uniquely confirmed and identified, then you have tremendous integrity without regard to what software system you’re using, what document management system you’re using, where everything can be uniquely confirmed as unique and valid.
Bob Ambrogi: So David what is a ledger and what is Integra Ledger doing within the context of legal industry?
David Fisher: So a ledger is as it sounds, I mean it’s a sequential document or digital document or record or table, where you just write entries. So in a traditional sense, a bank might have a ledger or a business might have a ledger and you write transaction after transaction to that ledger.
What’s unique about a distributed ledger or a blockchain based ledger is, you can only write to these, you can’t erase, you can’t change, you can only append, you can only write, that’s very important because if you want trust in the validity and integrity of what’s on the ledger, you want to know that it cannot be changed. And so the nature of blockchain distributed ledger technology is write-only.
Integra ledger follows that pattern in a sense that it’s a distributed ledger so every big law firm, every large corporation, university, institutions running a full node, as we would call them, this is really just a copy of the ledger, have with absolute uniqueness and integrity, the entire list of entries in that ledger. It’s a digital ledger and that’s copied across all nodes and the fact that everyone has a copy of those encrypted entries, means that there’s — you can trust what’s written there. If you can only write to the ledger and everyone has a copy of the ledger, then what you see on the ledger must be true.
Bob Ambrogi: I realize this is way over simplification but I keep thinking back to the early days of Napster when Napster was a distributed music service, where there was not a central server somewhere where all of these MP3 files were sitting, but rather they were distributed across a whole network of computers and basically being pirated in that way and distributed illegally in that way. I realized it’s not the same kind of a thing you’re talking about, but I keep coming back to that image of distributed files across a network of nodes around computers.
In the legal industry, I attended an event recently in which you were part of, and announcing the launch of something called the Global Legal Blockchain Consortium, did I get it right? Okay.
David Fisher: Okay.
Bob Ambrogi: And what is that and what is that trying to do in the legal industry?
David Fisher: Extremely important question with the Bitcoin blockchain or the Ethereum blockchain, which is another public cryptocurrency blockchain based system, those are called trustless systems, which means per your Napster example, yes, people are connecting with each other without an intermediary and there is trust in the distributed ledger blockchain architecture.
For the legal industry that poses some problems in the sense that we don’t need a trustless system with anonymity and in fact, it’s quite the opposite. I mean we know the counterparties, law firms know the other law firms they’re working with, clients certainly know each other, they’re involved in a transaction or a lawsuit.
So the need for a so-called trustless system or anonymity just is not the case in law. And in fact, we do need to know who the counterparties are, certainly know your customer, there are anti-money laundering issues in some cases with transactions and so what we needed was a system where there was governance with clearly understood rules, but governance by the industry itself.
So just like law is a self-governed industry, we felt that the technology foundation that we’re building for this needs to have the same self-governance. And so that’s big corporate in-house legal departments, big law firms, universities, software companies, all the stakeholders governing this infrastructure that then empowers trust and integrity in the system.
Bob Ambrogi: So do they, do the members of this consortium become the hosts of nodes on this blockchain or —
David Fisher: Some of them. The purpose of the consortium itself is to set standards, so what is identity, how is this going to be used, what’s the governance, what allows the system to change the rules. And there has to be trust in that system. First and foremost, the consortium is about setting those rules and ensuring that there’s a community governance trust aspect to this.
Secondarily, there’s the question of hosting the node, hosting the ledger. Certainly, we would expect that anyone in the consortium would be running a node, but that’s not exclusive to the people or say on the board of directors of consortium. So at this stage of the game, when we’re still developing standards, still developing governance, I mean there’s an initial group that’s come together so it’s big law firms, big companies, so IBM or like it’s a big law firm, BakerHostetler, those types of firms to initially join to set those standards, set the initial governance.
We’re still actually in the process of forming the consortium and adding the initial members. And so anyone that’s hears this is interested in learning more about that, we’re absolutely accepting new founding members.
Bob Ambrogi: All right. And you’ve also launched something if I have this right, the Integra Ledger Academic Alliance.
David Fisher: Yes.
Bob Ambrogi: What is that, what are they doing?
David Fisher: So as I’ve mentioned, we are trying to engage all the stakeholders in the system. This is deep level foundational technology. I mean we are not creating applications for this, this is infrastructure for everyone else.
Bob Ambrogi: Yeah.
David Fisher: So we felt that with new generations of lawyers coming through the system and young tend to be more tech savvy, people that have maybe used Bitcoin and Ether and Ethereum to empower them to understand what this is as infrastructure they may be using, when they enter the formal practice of law. We felt there was — it was ideal to engage the law schools both for the purpose of educating the students as well as developing further standards and protocols to use on the system. So it’s both law schools, universities, computer science departments, stakeholders, frankly, which we think is a critical component as the future of law.
Bob Ambrogi: So Integra Ledger is a business for you, I assume, what is the business model, how do you make money off of doing this?
David Fisher: It’s — to give you an example that will help people to understand how it’s structured. If you think about the early days of the Internet and the Domain Name System and DNS and name registry, this is set up similar to ICANN and Network Solutions.
So Network Solutions was a private company that was engaged under contract with ICANN to develop the domain name registry system. And eventually, that sunsetted once the infrastructure was built and now you can register domains with thousands of — tens of thousands of companies.
Integra initially is setup in a similar fashion, where to create the infrastructure really it’s on a governed utility basis, governed by the global legal blockchain consortium, for a set period of time to stand up the infrastructure. So that the entire industry and when I say industry worldwide, so it’s government, private, criminal, corporate, you name it, like all of — we call it a new legal fabric, blockchain based fabric. The economic model is a contracted, basically regulated one for a set period of time just to build the infrastructure and then it will be a competitive open market.
Bob Ambrogi: Okay. Do you envision that there will be other consortia focusing on law and if so, how do you normalize or bring together the work of those different consortia?
David Fisher: We haven’t seen that yet for what we’re talking about, which is business of law. We have seen that with smart contracts, which is what we call an application layer on top of what we’re doing, so we’re not involved in smart contracts standard-setting. But there are other consortia that are focused on that. We have not yet seen what that’s focused on core legal identity and much as the world benefits from a consistent system of domain name registration.
I mean it’s unified, it all makes sense, everything interoperates, we think that there’s no benefit to having multiple standards, multiple competing standards, in the event that another one emerges, we would certainly try to unify them at that time, but for the moment no one else has proposed a standard setting body at this foundational level.
Bob Ambrogi: Yeah. What do you see as the future of blockchain in the legal profession, the legal industry?
David Fisher: I’m not sure it’s going to be noticeable to the average attorney or average client because most of what it empowers is behind the scenes with respect to data security which my favorite expression right now is that legal technology is at terminal complexity; meaning that for all of the wonderful new functionality, we’d like to build, it’s so hard to integrate that into the disparate systems that currently exist, that the active actually trying to integrate it, increases attack vectors and so that’s why I refer this as terminal complexity.
We think blockchain standards underneath this, underneath the legal industry will start to rewire the industry for just greater security, greater data integrity, such that more innovation can occur plugged into a more secure infrastructure.
So again, the average attorney, average client may not notice anything, but behind the scenes we’re talking about greater privacy, greater security and eventually greater functionality, as people can build more on top of that, without worrying about the risk.
Bob Ambrogi: So as these standards are written applications and functionality will have to be written to conform to those standards essentially in some ways.
David Fisher: And that’s part of reason we’re at Clio, we’re good friends with the Clio folks. Clio is a great example as of a nearly ubiquitous practice management application with many functions, many integration partners, and to the extent that Clio becomes hopefully more blockchain centric and its core identities behind the scenes, it makes Clio more secure, it makes all its integration partners more secure.
Bob Ambrogi: Yeah.
David Fisher: So I think that’s how it’s going to transform it.
Bob Ambrogi: Yeah. But I think we talked about Clio, we’re here I don’t think we mentioned, we’re here at the Clio Conference recording this live right now, and a lot of the Clio users tend to be more smaller mid-sized firms, not maybe some of the — I know the consortium I think at this point is kind of more large firm oriented.
How does the small firm lawyer start to get his or her arms around blockchain and what it means for their practice?
David Fisher: Actually, there is a session going on right now.
Bob Ambrogi: Go there.
David Fisher: I think first and foremost getting a basic education of what blockchain is, is helpful. I would encourage attorneys, encourage anyone frankly to go through the process of figuring out how to buy some Bitcoin, just to understand what that means to actually buy some and have the wallet and wrestle with those problems.
Bob Ambrogi: I want to wait a while to buy it but.
David Fisher: Yeah. But even if it’s $2 worth, I mean just to see what that process is, demystify it. I think the one way to stay in touch certainly is to go to the consortium website. So it’s HYPERLINK “http://www.legalconsortium.org/”legalconsortium.org, is a place where you can get your name on a list and get updates, get information. Certainly one of the missions of the consortium is education, and that’s one way to learn more. Beyond that there are many good TED Talks online on YouTube. And so if you want to learn more just about the technology, that’s a good place to start. How’s that?
Bob Ambrogi: That’s good. All right, we are just about out of time here. I just wanted to give you an opportunity to give us any, if you have any closing thoughts or anything else you wanted to share or mention about this before we wrap up.
David Fisher: Yeah, so I think whether you’re an attorney at a big firm or a solo or a small firm or in-house or government, wherever you are, whoever you are, the Global Legal Blockchain Consortium, which is really where this starts is where you belong. We’re engaging everybody in this effort.
Again it’s a standard setting exercise. So it’s not about selling software, it’s not about paying fees or dues, it’s none of that. It’s trying to unify the industry globally around standards so that as attorneys, as legal service providers, we can provide more service, better service to clients, and do so in a way that’s secure and private.
And so I think to at least sign-up for more information is the ideal starting point to have connectivity to this effort and it’s a global effort. And I think in the months ahead you’ll see many terrific developments around that and that will be software providers, it will be education, there will be seminars and workshops around the country, around the world.
So probably the best starting point is go to that website, HYPERLINK “http://www.legalconsortium.org/”legalconsortium.org, sign-up, get on the mailing list, and then go from there.
Bob Ambrogi: Sounds good. I noticed you’ve also — I don’t know if you’ve — you have a website or not, but I noticed you’ve had some posts up on Medium under the Integra name, a couple about the future of blockchain in the legal industry, and that sort of thing that have been really good too. So people might want to just Google your name and look for those. I can tell you they come up in a Google search, because I just saw them the other day.
Well, I think that’s good. David Fisher, I really appreciate your taking the time to be with me today and to talk to us a little bit about all the interesting work you’re doing.
David Fisher: My pleasure. Thank you very much.
Bob Ambrogi: Thanks for being with us. And that about does it for this episode of Law Technology Now. If you like what you’re hearing, please go to the Apple Store and give us a two thumbs up.
Thanks everybody at the Legal Talk Network. Thanks for listening.
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|Published:||October 23, 2017|
|Podcast:||Law Technology Now|
|Category:||News & Current Events , Legal Technology & Data Security , Security|
Law Technology Now
Law Technology Now features key players, in the legal technology community, discussing the top trends and developments in the legal technology world.