#LegalTechPills
  • Instituto de Conhecimento
  • Propriedade Intelectual e Tecnologias da Informação

Legaltechs: Forbidden to Forbid

By Helder Galvão on

A Brazilian legaltech, Resolve Juizado, identified a market flaw and, like any innovative company, seized an opportunity. Its business model is simple yet highly scalable: selling automated legal petitions for up to five euros, allowing consumers to claim rights and small compensations — those everyday issues we all face.

The idea is neither new nor revolutionary. Nevertheless, it unsettled the Rio de Janeiro Bar Association, which filed a lawsuit to take the platform offline. According to the organisation, the legaltech trivialises the legal profession, undermining the essential role of lawyers and potentially compromising the quality of access to justice, given that the technical rigour of such petitions may be questionable.

The lawsuit was initially successful under an interim injunction, suspending the platform. However, a higher court later overturned the decision. Notably, Justice Herman Benjamin of the Superior Court of Justice expressed his view that the integration of legaltechs into daily life — particularly in low-complexity situations — represents progress towards enhancing legal certainty in the country. Moreover, he stated that these technologies are not intended to replace legal professionals, but to offer valuable resources to courts, legal practitioners, and citizens alike.

The impact of a ruling by a judge from the country’s highest court in favour of a legaltech was immediate. On one side, technology enthusiasts saw this as confirmation that legal digitalisation is inevitable and now endorsed by authority. On the other, the leading professional body grew concerned about the commodification of legal practice and the creation of legal precedents that might threaten its members’ interests.

What is truly at stake is who will exploit a genuine goldmine. The figures are striking: 1.4% of Brazil’s GDP — the tenth-largest economy in the world — is consumed by litigation. Of the more than eighty million legal cases on record, over half concern consumer-related disputes. At Justice Herman Benjamin’s court alone, over half a million legal cases were filed last year, and more than six hundred thousand rulings were issued.

In monetary terms, the scale surpasses the GDP of many European countries. Judicial deposits — funds paid by losing parties that await withdrawal by successful claimants — are estimated to exceed seventy billion euros. Meanwhile, the average duration of a consumer dispute case is around four years, with the ratio of ongoing lawsuits per 100,000 inhabitants comparable to that of China and India — two of the most populous nations on Earth.

The dispute between Resolve Juizado and the Rio de Janeiro Bar Association highlights another crucial issue: in a market with 1.3 million lawyers — second only to the United States — the professional body feels obliged to safeguard its monopoly over legal practice. The emergence of more platforms could encroach on the domain traditionally reserved for solicitors and barristers. However, no concrete evidence substantiates this fear.

Firstly, it is unreasonable to assume that an average citizen purchasing a five-euro petition would otherwise hire a lawyer for court representation. It is well established that minor or low-value claims can be resolved directly via online dispute resolution (ODR) platforms. Major global e-commerce sites such as eBay already use such mechanisms. In consumer disputes involving airlines, similar platforms are also commonly employed.

Secondly, the assumption that such legaltechs only serve laypersons is false. Increasingly, legal professionals and independent practitioners are adopting these platforms to scale their services, improve efficiency, and save time. At the end of the day, the legaltech’s user base includes lawyers themselves. As British legal scholar Richard Susskind puts it: “more for less” — greater efficiency in less time and at lower cost. It’s a virtuous cycle in which everyone gains — a true win-win scenario.

Thirdly, Justice Herman Benjamin aptly described the attempt to prohibit legaltechs as a “democratic paradox”. Banning technologies that enhance access to justice risks limiting democracy itself. In the Minister’s view, democracy requires ensuring that all citizens can exercise their rights and resolve their problems — not building barriers that prevent them from doing so. In summary, the appropriate path is to regulate the use of new technologies constructively, not prohibit them out of fear of change.

The tug-of-war is far from over. The Rio de Janeiro Bar Association has filed a fresh appeal against the ruling that upheld the legaltech’s continued operation. Some jest that the appeal did not use Resolve Juizado’s low-cost automated petitions.

Nonetheless, regardless of who is right, three certainties remain: you cannot stop the flow of water — and the Minister’s ruling reaffirms that timeless truth. Moreover, everything that is censored tends to grow. Resolve Juizado undoubtedly gained momentum from the controversy, and many other legaltechs will surely follow, eager to tap into this valuable niche. And finally, as Caetano Veloso once sang — in a direct message to the legal establishment — it is forbidden to forbid.

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