Uploaded June 2024 | Updated September 2026, 2 weeks ago

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#rag #hallucinations #legaltech

An in-depth look at a recent Stanford paper examining the degree of hallucinations in various LegalTech tools that incorporate LLMs.

OUTLINE:
0:00 - Intro
1:58 - What are legal research tools and how are large language models used by them?
5:30 - Overview and abstract of the paper
9:29 - What is a hallucination and why do they occur?
15:45 - What is retrieval augmented generation (RAG)?
25:00 - Why LLMs are a bad choice when reasoning is involved
29:16 - The products that were tested
32:00 - Some shady practices by the researchers in the back and forth with the legal research companies
37:00 - Legal technology companies’ marketing claims to eliminate or solve hallucination risk
45:27 - Researchers evaluation of RAG for legal and requirement to have specialized education to use the research tools
55:27 - How the researchers propose to measure accuracy and the problems of measuring accuracy
1:09:20 - Researchers conclusion

Paper: arxiv.org/abs/2405.20362

Abstract:
Legal practice has witnessed a sharp rise in products incorporating artificial intelligence (AI). Such tools are designed to assist with a wide range of core legal tasks, from search and summarization of caselaw to document drafting. But the large language models used in these tools are prone to "hallucinate," or make up false information, making their use risky in high-stakes domains. Recently, certain legal research providers have touted methods such as retrieval-augmented generation (RAG) as "eliminating" (Casetext, 2023) or "avoid[ing]" hallucinations (Thomson Reuters, 2023), or guaranteeing "hallucination-free" legal citations (LexisNexis, 2023). Because of the closed nature of these systems, systematically assessing these claims is challenging. In this article, we design and report on the first preregistered empirical evaluation of AI-driven legal research tools. We demonstrate that the providers' claims are overstated. While hallucinations are reduced relative to general-purpose chatbots (GPT-4), we find that the AI research tools made by LexisNexis (Lexis+ AI) and Thomson Reuters (Westlaw AI-Assisted Research and Ask Practical Law AI) each hallucinate between 17% and 33% of the time. We also document substantial differences between systems in responsiveness and accuracy. Our article makes four key contributions. It is the first to assess and report the performance of RAG-based proprietary legal AI tools. Second, it introduces a comprehensive, preregistered dataset for identifying and understanding vulnerabilities in these systems. Third, it proposes a clear typology for differentiating between hallucinations and accurate legal responses. Last, it provides evidence to inform the responsibilities of legal professionals in supervising and verifying AI outputs, which remains a central open question for the responsible integration of AI into law.

Authors: Varun Magesh, Faiz Surani, Matthew Dahl, Mirac Suzgun, Christopher D. Manning, Daniel E. Ho

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