The First Dot

In this blog, I’m going to explain why in-house counsel needs a “first dot” in order to identify a litigation, product or other form of risk.

But here’s the bottom line: In order to avoid the high costs of settlements or verdicts; attorney, e-discovery and expert fees; brand and personal reputation damage; and, in extreme situations, a criminal conviction, corporate counsel needs a “first dot.”

Where are those dots? That’s the easy question. They’re in the enterprise’s internal communications, such as emails. Now for the hard question: How can anyone peer into these communications in near real-time in order to find even a single “first dot”?

Intraspexion’s patented answer to that question is “artificial intelligence” in the form of deep learning. But I’m going to stay away from the “tech” in this blog. Here, I just want to cover the importance of First Dots. 

Remember Connect the Dots, a game for children? How about BMEWS, a billion-dollar Cold War strategy?

Do you recall the criticism of the CIA and FBI after the September 11 attack in 2001?

And did you know that the U.S. Center for Disease Control and Prevention has had a program since 2014 to prevent various forms of violence? In the first training session I watched, I finally got the point of it all: it’s the First Dot that matters. 

Let me explain.

In the game that I played before 1958, and which we still present to children, a cluster of dots forms some pattern that isn’t recognizable until the dots are connected. The dots may be numbered or lettered, and kids learn to start with “1” or “A” and go from there to “2” or “B”.

Here’s a collection of over 50 of these games (free and last updated on October 5, 2018):

But in 1958, BMEWS was the acronym for finding a First Dot. It was a radar, computer and software system that was built between 1958 and 1961 as a strategy to give our military a 15 to 25 minute early warning of an intercontinental ballistic missile attack by the Soviet Union.

Here’s the Wikipedia link to BMEWS (last updated on October 2, 2018):

The First Dots, of course, would have been the detection of missiles coming at us from over the horizon.

Now fast forward to September 11, 2001. I was in Los Angeles and awake early. I turned on the TV to see the news was one of the Towers in New York had been hit by a jet and was on fire. My wife Lois was traveling to San Diego and I called her. While I was on the phone with her, I saw the second plane fly into the other Tower. Lois stopped to go into a diner. The TV was on but wasn’t tuned to a news channel. She knew what others didn’t.

I learned from her that it’s mentally difficult to know about a First Dot and know that it’s true when others don’t have a clue.

But 9/11 wasn’t the First Dot. Although the CIA and FBI were criticized for not sharing their respective stores of data and connecting the dots, the problem was opaque because the First Dot didn’t come with a number or a letter. It had to be tracked down and evidently wasn’t apparent until the plot’s organizer, Ramzi Yousef, was arrested. With enough puzzle pieces, the story could be re-assembled.

And for a step-by-step of the dots that led to 9/11, and how they were connected, see the PBS’s Frontline episode, “Connecting the Dots.” According to this look in the rear-view mirror, 9/11 had its genesis with the World Trade Center attack … in 1993.

So if you’re curious, here’s the link to the PBS Frontline webpage and the “Connecting the Dots” episode. The webpage allows you to take a step-by-step tour through the dots:

Now, more recently, the U.S. Center for Disease Control and Prevention has developed a training program to teach the public how to recognize the links between multiple forms of violence. The first training session begins in the same way I started this article – with the game that children play. The first training session is here:

Evidently launched in October of 2014, the Veto Violence trainings address the violence due to child abuse & neglect, intimate partner violence, sexual violence, suicide and youth violence.

Here’s the link to that first training video (1:13):

From this video, it dawned on me that the First Dot was critically important for risk detection and avoidance.

But what if the First Dot is a false alarm? Well, history shows us that even our missile defense systems can suffer from false alarms. Had we not found their causes within a matter of minutes, the disaster could have been catastrophic on a global scale.

For this topic, see the New York Times article - Causes of False Missile Alerts: The Sun, the Moon and a 46-Cent Chip (January 13, 2018) - here:

Now let me translate. When an artificial intelligence (AI) model for a specific risk reports a high-scoring email as being “related” to the risk, and corporate counsel reads that email and assesses it as being a True Positive, that email is a candidate for further consideration as a First Dot … and only then will anyone authorize an internal investigation.

But what if there is no early recognition of a First Dot and so no early warning? That’s entirely possible and is more often the case than not. After all, corporate attorneys are busy; they tend to be slow adopters of new technologies like AI; and they tend to be resisters of change.

My point is this: Without AI as way for a human being to recognize a potential First Dot, there’s no reason for anyone to even try to sift through the cluster of yesterday’s emails to find the risky ones. 

Ah, but what about whistleblowers and hotlines?

The good and bad of hotlines are that companies sometimes have them but don’t encourage their use. And, while some employees may use hotlines, many may not use them for fear of reprisals (as in “kill the messenger”).

Are they the best we can do? No. And, in my view, AI disrupts them.

Are you trying to find First Dots? Probably not.

But that’s what Intraspexion’s patented deep learning system can do for you: It takes your company’s emails from yesterday, scores them against a previously identified pattern for a specific risk, and provides you with candidates for an internal investigation.

Then, after you conduct that investigation, you’ll learn whether one of those high-scoring emails was the First Dot.






Is It Better to Know About a Risk or Not to Know?

      With so much going for a litigation early warning system, how could it fail to be a game-changer?  We’ve had more than one person suggest this question: “Wouldn’t the attorneys, or the executives, prefer not to know?”[1]

            Or these variations on that theme:  “What if the enterprise knew and didn’t do anything?  If the failure to act, after having knowledge, were to be discovered, wouldn’t that be worse than not knowing about the threat in the first place?” 

            So we must be clear-eyed about this.  Our view is this:

[T]he profession needs to rethink its role from that of an ambulance at the bottom of a cliff (remedial practice) to helping people to manage risks on top of the cliff.  While the practice at the bottom of the cliff can be very profitable, clients and consumers should be reminded to avoid practices that are detrimental in the longer run.

     To practise [sic] preventive law, we must first work with relevant data.  Some of our colleagues may not consider this part of the job description of the legal function, but it is down to us to embrace it or watch someone else do so in the course of taking our profession to the next level.  In today’s big data era, this is not an option, but a necessity.[2]

            But do attorneys perceive any need to change?  Historically, the answer is no.  As the Hon. John Facciola (U.S. Magistrate Judge, retired) has recounted, “the telephone was in existence for 10 years before lawyers started to use it.  They thought it was beneath their dignity.”[3]

            So, there are obstacles, and we can list some of them.  First, we face the momentum in the legal profession which argues against change, especially when the change involves technology.  While some of the lawyers who are litigators must now learn to understand technology in the eDiscovery aspects of every lawsuit, they still resist it.  Yet many litigators do not know how to use that necessary but admittedly specialized technology. 

            In fact, they are not even proficient with the basics:  software programs for word processing, spreadsheets, and PDFs.  And this is why D. Casey Flaherty, formerly in-house counsel at Kia Motors America, and Suffolk University’s School of Law recently launched the Suffolk/Flaherty Legal Tech Audit.[4] 

            In July of 2013, Flaherty explained:

“My hypothesis is that lawyers in general are woefully deficient in using the software tools at their disposal – for example, Word, Acrobat, Excel.  To test this, I provided associates at outside firms with mock assignments.  Sample tasks include (a) formatting a motion in Word, (b) preparing motion exhibits in PDF, and (c) creating an arbitration exhibit index in Excel.  

     I’ve administered the audit 10 times to nine firms (one firm took it twice).  … [A]ll the firms failed—some more spectacularly than others. The audit takes me 30 minutes…. Both the median and mean (average) pace rounded to 5 hours.[5]

            Second, we face the momentum that has in-house counsel acting as procurement and matter managers of the cases in which an enterprise is involved.  They depend on the “bench” of outside law firms to do the heavy lifting. 

            Third, in-house counsel may balk at having a tool which permits them to take on the mantles of investigator and analyst.  Is this the practice of law?  Can’t the IT or HR departments do this work instead of us?

            Fourth, in-house counsel may resist a change which permits them to be strategic business partners with the company’s other leaders.  Who’s in charge?

            Fifth, the larger plaintiff-oriented law firms may resist any change that reduces the number of prospective plaintiffs.  Their reason for being is to redress harm and to recover damages.  With fewer deaths, injuries, and other civil wrongs, there would be fewer prospective plaintiffs, and the plaintiffs’ “bar” would have fewer clients to represent.  (However, they can hardly complain if their stated goal is actually achiever, but in some other way.  Who can wish for more deaths, injuries, and other civil wrongs?)

              Sixth, the larger defense-oriented law firms may resist any change that reduces the number of lawsuits for them to defend.  Their firm revenues are based, in part, on the number of cases they are engaged to defend, and the amount of hours they bill to defend them.  They have no financial interest in seeing these metrics go down. 

            And, any early warning system, at least in its early versions, may produce a number of false positives, such that early adopters may look for an early exit and return to their comfort zones.           

            Finally, it could turn out that many business leaders might genuinely prefer to simply deal with lawsuits as they come, to be strictly customer-facing, and to stick with driving revenue and profits.

            It seems that there are many reasons “not to know.”   

            But we contend that we humans have learned, in other contexts, that it is far better to know than not to know.  The Greeks knew this long ago, and we have already mentioned their phrase for it:  Forewarned is forearmed.  The ostrich defense—sticking one’s head in the sand to avoid knowing about the nearby predator—has never worked very well for the ostrich.  In American jurisprudence, this defense is not well known as a successful strategy and has been alternatively called the dumb CEO defense, dummy defense, idiot defense, or Sergeant Schultz defense.[6]

            In our view, it is better to suffer through some number of false positives than to be blind-sided by a preventable litigation catastrophe.

            We think Bill Gates would agree.  In 1999, he wrote a book[7] to which he devoted a whole section and six chapters to explain why.  Chapter 10 was entitled, “Bad News Must Travel Fast.”  He even went a step further, and began the section this way:

“I have a natural instinct for hunting down grim news.  If it’s out there, I want to know about it.  The people who work for me have figured this out.  Sometimes I get an e-mail that begins, “in keeping with the dictum that bad news should travel faster than good news, here’s a gem….”[8]      

            Gates provides lots of examples, including from the computer industry.  He mentioned IBM, when its mainframe and minicomputer businesses were undermined by the PC; Digital Equipment Corporation, when its minicomputer business was undercut by still smaller PCs, which DEC had dismissed as toys; and Wang, which lost the word processing market when it stuck with putting word processing software on dedicated hardware systems rather than on the PC.[9] 

            He also mentions Ford, Douglas Aircraft, and why the United States was not prepared for the attack on Pearl Harbor.[10]

            Gates advised this:

“A change in corporate attitude, encouraging and listening to bad news, has to come from the top….  The bearer of bad tidings should be rewarded, not punished….  You can’t turn off the alarm and go back to sleep.  Not if you want your company to survive….[11]

            Gates asserts that leaders should heed the early warnings from salespeople, product developers, and customers, but he doesn’t mention the Legal Department.  We can excuse the Legal Departments of the past.  They had no way to see litigation in-the-making, and so could not sound off to give what Gates called an “alert.” 

            But now they can see.  An alert from a system intended to prevent litigation is like a smoke alarm: When it goes off, it doesn't necessarily tell you there's a fire; but you have to pay attention to it.




[1] The original source of this blog article is Chapter 24 of Preventing Litigation: An Early Warning System to Get Big Value Out of Big Data (Business Expert Press 2015), whose principal author is Intraspexion’s founder. Intraspexion’s use of the material here, with very few changes, is with his permission and is permitted by his contract with the publisher. Intraspexion’s co-founder, Larry W. Bridgesmith, added the points concerning the criminal sentencing guidelines and Sarbanes Oxley.

[2]  Kenneth Tung.  March, 2015.  “A Kodak moment for the legal profession,”, (last accessed April 11, 2015).  In 2008, law practice guru Richard Susskind, who endorsed Preventing Litigation, said as much in The End of Lawyers? Rethinking the Nature of Legal Services (Oxford: Oxford University Press), p. 224.

[3]  Hon. John Facciola (interviewed by Zoe Tillman).  April, 2015.  “Law at the Speed of Technology.”  Corporate Counsel, p. 56.

[4]  D. Casey Flaherty and Andrew Perlman.  2015.  Suffolk/Flaherty Legal Tech Audit. (last accessed April 8, 2015) (“The test takers will finalize a redlined investors’ rights agreement (word processing). They will then be given data on dividend payments to investors to investigate whether payments were made equally to all investors (spreadsheets). Finally, they will prepare an e-filing attaching the agreement and spreadsheet (PDF).”).……….

[5]  D. Casey Flaherty.  July, 2013.  “Could you pass this in-house counsel’s tech test? If the answer is no, you may be losing business.”  ABA Journal, (last accessed April 8, 2015).

[6]  U.S. Legal, Inc.  Unknown date.  “Ostrich Defense Law and Legal Definition.” (last accessed April 27, 2015). Furthermore, an ostrich defense does not open the door to favorable treatment for being proactive under the criminal sentencing guidelines, and defies the mandates of Sarbanes Oxley requiring publicly traded companies and their executives to adopt and use proactive policies and procedures to uncover fraud and illegality. 

[7]  William H. (Bill) Gates III, with Collins Hemingway.  1999.  Business @ the Speed of Thought:  Using a Digital Nervous System (New York:  Warner Books, Inc. 1999), pp. 159-200.

[8]  Ibid. at 159-160.

[9]  Ibid. at 179-180.


[10]  Ibid. at 180.  For the Pearl Harbor example, Gates cites Gordon Prange, At Dawn We Slept (New York:  McGraw Hill, 1981) at 439-492 (chapters 54 through 59), for communications breakdowns and “fundamental disbelief” on the U.S. side during the weekend of December 6-7, 1941. 


[11]  Ibid. at 179.


Intraspexion Receives a Rave Review

Every once in a while, I put “intraspexion” into a search engine and see what comes up.

Today I found an article about Intraspexion I hadn’t seen before.

The title of the article is “Predict the Risk of a Law Suit? Intraspexion’s Deep Learning Model Makes it Possible.”

This article was published on February 21, 2018, and was written by Pranav Dar, an editor at Analytics Vidhya.

According to the Analytics Vidhya website, Pranav Dar is a “Data visualization and Six Sigma practitioner who loves reading and delving deeper into the data science and machine learning arts. Always looking for new ways to improve processes using ML and AI.”

Dar’s article is here:

I’m only going to quote a portion of the article’s last paragraph:

“Intraspexion is as unique as it is transcendent. Their software has the capability of saving millions of dollars for firms and sets the precedent for others to follow.”

From what I see in other articles on Analytics Vidhya's website, they know Deep Learning. So quite apart from the (previously unknown) rave review Intraspexion received, I’m a subscriber now.

Is Intraspexion like "Minority Report" or "WarGames"?

Minority Report, the 2002 sci-fi film directed by Steven Spielberg, comes to mind because the “precogs” were predicting crimes. We use software to “predict” litigation.

In December of 2016, Richard Tromans, who writes a popular blog from London as the Artificial Lawyer, made this connection. He wrote, "Think 'Minority Report,' but using algorithms instead of pre-cogs."

A few months later, Attorney Jeff Cox made that connection too. In an article for the ACC’s Legal Ops Observer in March of 2017, “AI for Legal Ops and Corporate Counsel - The First Wave,” Jeff wrote about several AI startups and covered Intraspexion first. He wrote, “Intraspexion is the Minority Report of litigation.”

When Jeff conducted his pre-article interview, he told me that a reference to Minority Report helped him explain Intraspexion to others, and that it worked for them in a flash of understanding.

But when this question comes up, I also recall the 1983 film WarGames. (Click the title for a third party's YouTube clip of the movie's last few minutes. Ad supported.)

The clip is one of the best last four minutes of any movie, but I’ll summarize it for you:

At the end of the movie, a computer named Joshua is playing a game called Global Thermonuclear War, but doesn't realize it's a game.

Towards the end of the film, while Joshua is trying to obtain the President's launch codes, the hero (played by Matthew Broderick) directs it to play tic-tac-toe, and to play against itself in order to learn "futility." Joshua plays tic-tac-toe game repeatedly, until it finally "understands" that every scenario produces no winner. 

Once it "understands" futility and transfers that learning to the War Game it's been playing (which tech readers may recognize as transfer learning), Joshua utters a memorable line:

"Greetings, Professor Falken. A strange game. The only winning move is not to play." 

The computer then shuts down Global Thermonuclear War, and says with "How about a nice game of chess?" 

Litigation is like Global Thermonuclear War.

Why? Because even if the company wins in the end, it loses.

Everywhere you look, financial resources are burning.

First, if the comany's a net winner, it's unlikely to collect.

Or, if it prevails against its adversary, and owes nothing, the company must still pay the defense attorney fees, expert witness fees, the costs of eDiscovery, and so on.

And if it settles or loses at trial, it must also pay the amount of the settlement or the verdict.

Business leaders have always been smarter than Joshua. They know that the only winning move is to avoid or prevent litigation. Until now, with Intraspexion, there just hasn't been a way to do that.  

What's the Business Case for Preventing Litigation?

In Nick Brestoff's book, Preventing Litigation: An Early Warning System to Get Big Value from Big Data (Business Expert Press 2015) (hereinafter Preventing Litigation), he presented his calculation that the average cost per case at $408,000. See Chapter 4 ("What's it worth to prevent a lawsuit?").

The global numbers, for the ten-year period from 2001 through 2010, are as follows:

The “cost” of commercial tort litigation (rounded) is: 

$1.6 Trillion

The number of Federal and State lawsuits (also for 2001-2010) (rounded) is: 

Four Million Lawsuits

These two numbers (reduced by 15 percent and rounded) indicate the Average Litigation “Cost” per lawsuit is (rounded):