NetDocuments recently announced its venture into the plaintiffs’ contingency fee lawyer’s market. That fact in and of itself is interesting. But how it got there is perhaps even more so and a good lesson.

According to its press release, NetDocuments is now offering a Medical Chronology app which it says can summarize and extract key events from medical records into a structured memo for chronological review. Secondly, it has announced a Demand Generator app that, according to NetDocuments, can extract facts, causation evidence, and itemized damages from medical records and case documents to prepare demand letters for personal injury, employment, and insurance bad faith matters.

Finally, it is now offering an Expert Witness Profile Builder app which it says can build structured expert witness profiles from CVs, transcripts, and published works, pulling credentials, prior opinions, and case histories. NetDocuments says the tool can flag testimony inconsistencies and supply cross-examination fodder.

All very interesting and no doubt has pricked the ears of vendors like EvenUp Law and Supio, although I am sure each would be quick to point out that their products do much more than the three apps now offered by NetDocuments. But that misses the point.

NetDocuments has historically been seen as a vendor for larger firms. Most plaintiffs’ firms other than Morgan and Morgan and perhaps a few others are relatively small. So now, NetDocuments has an opening in that market and will no doubt be developing other tools to better compete. And it’s doing so by looking at its existing products and figuring out how they can be applied to address the needs of a different market segment.

How NetDocuments Did It

It’s interesting how NetDocuments decided to do this. I recently had a chance to talk to Heath Harris, NetDocuments’ VP of Applied AI, about its move into this space. Heath told me NetDocuments was looking at the tools that it had already developed for its larger customers, like in-house legal departments and law firms that bill by the hour, to find other uses.

It was clear, says Harris, for example, that NetDocuments’ core products conceptually work across documents to turn unstructured data into a structured database. In doing so, it enables the creation of tools that can be used to do things like securely review and summarize lengthy documents. Or generate documents that consistently follow the same format. Or create the tool it calls Judge Analytics that NetDocuments developed to keep track of data about judges. These tools basically turn data into “institutional strategic knowledge,” according to Harris.

An Aha Moment

The real “aha” moment may have come when someone said, you know who could really use these kinds of tools are lawyers who don’t bill by the hour. Lawyers who get paid solely based on results. Like plaintiffs’ contingency fee lawyers to whom a minute saved is a dollar earned instead of the reverse. What NetDocuments realized is that it could take existing tools and, with a few tweaks, turn them into tools that this market could use.

Harris told me it was like “candy in a lot of ways.” It’s a great example of the realization that existing applications are really like “flowing stuff…transforming stuff into something” others can use, according to Harris. Harris pointed out that “this is what you can then do with that data by putting simple AI applications on top of it.”

To create the expert profile tool, for example, NetDocuments realized that it already had a tool with the ability to create a database of people and places that could then summarize what the database contains and extract all sorts of key information.That tool was Judge Analytics. The expert profile tool, Harris said, stemmed directly from the same concepts underlying the Judge Analytics tool.

Thinking Differently

I can’t, of course, tell you whether these new tools work as described or if NetDocuments will be successful in the new market. But what I can tell you is that, as usual, NetDocuments is focusing on the customers in the plaintiffs’ market.

Harris told me they understand the need to market these tools to a bit of a different market. NetDocuments has even hired what Harris describes as startup-oriented Silicon Valley types to help understand what the market looks like from a customer experience standpoint. Sounds like tech bros, but Harris told me what “really differentiates this [approach] is how you bring all that valuable context to life with those tools and how you enable your customers to govern that at the same time.”

The key is that the tools being offered in the plaintiff market were an application of tools already developed for other markets and customers. That’s opportunity thinking. And it’s another example of NetDocuments’ workmanlike approach to document management. As Josh Baxter, NetDocuments CEO, once told me, “We’re not a rock band.” It’s a refreshing approach in a market where most vendors overpromise and then underdeliver. All with overblown hype and hyperbole. Instead, NetDocuments went to work and looked for different uses.

It will be interesting to see where NetDocuments goes in the plaintiffs’ market. But by looking at the tools it already had and understanding exactly what they were doing, NetDocuments saw the opportunity for a whole new market. Harris says, “It is pretty cool.”

I think Harris is right.

Stephen Embry is a lawyer, speaker, blogger, and writer. He publishes TechLaw Crossroads, a blog devoted to the examination of the tension between technology, the law, and the practice of law.

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