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Welcome to this week's edition of The Legal Wire!

The AI landscape is shifting fast, with major players making bold moves and regulators tightening the reins. SoftBank and OpenAI are joining forces to expand AI in Japan, launching a billion-dollar venture to push enterprise AI adoption. Meanwhile, the EU has drawn a firm line, banning AI systems deemed too risky under its landmark AI Act—setting the stage for tough compliance battles ahead.

On the competition front, Alibaba is making waves, claiming its new AI model outperforms OpenAI and DeepSeek, escalating the AI arms race in China. And in a rare but powerful intervention, the Vatican has issued ethical guidelines on AI, warning against unchecked automation in warfare, relationships, and healthcare.

This week’s Highlights:

• Industry News and Updates

• AI in Criminal Justice: The Bias and Accountability Dilemma

• Recital: Simplifying Contract Management for In-House Counsel

• AI Tools to Supercharge your producivity

• Legal prompt of the week

➡️ SoftBank and OpenAI Launch Joint Venture to Expand AI in Japan | The SoftBank and OpenAI announced a 50-50 joint venture to bring AI solutions to Japanese businesses, hiring 1,000 staff to market enterprise AI services. The collaboration underscores SoftBank’s growing AI ambitions, including its role in the $500 billion Stargate Project. The venture will introduce "Cristal Intelligence" for businesses, with leaders set to meet Japan’s prime minister.
^{February 3, 2025, Source: Bloomberg}

➡️ EU Bans AI Systems with ‘Unacceptable Risk’ Under Landmark AI Act | The EU’s AI Act now prohibits AI applications deemed high-risk, including social scoring, predictive crime modeling, and real-time biometric surveillance. Companies violating the ban face fines up to €35 million or 7% of global revenue. While enforcement begins in August, compliance challenges remain, with further regulatory guidelines expected later this year.
^{February 2, 2025, Source: TechCrunch}

➡️ Alibaba Claims New AI Model Outperforms DeepSeek and OpenAI | Alibaba has released Qwen 2.5-Max, claiming it surpasses DeepSeek-V3, GPT-4o, and Meta’s Llama-3.1-405B. The move follows DeepSeek’s rapid rise, which triggered price wars and forced Chinese tech giants like ByteDance, Tencent, and Baidu to accelerate AI upgrades. DeepSeek founder Liang Wenfeng remains focused on AGI, dismissing competition over pricing.
^{January 29, 2025, Source: Reuters}

➡️ Vatican Issues AI Ethics Guidelines, Warning Against Unchecked Automation | A new Vatican document outlines ethical AI guidelines, warning against its unchecked use in warfare, relationships, healthcare, and misinformation. The Church emphasizes that AI should complement, not replace, human intelligence, stressing the need for oversight in areas like surveillance, education, and environmental impact.
^{January 29, 2025, Source: AP News}

Legal Technology

AI in Criminal Justice: The Bias and Accountability Dilemma

In 2020, the Detroit police wrongfully arrested Robert Williams for shoplifting based on a match generate by a facial recognition system. This was one of the first publicized cases of AI implicating someone incorrectly in a criminal case. Naturally, his wrongful arrest sparked outrage and debate over the role of artificial intelligence in the justice system, and even more so, when the use of facial recognition technologies led to two more cases of wrongful arrest.

These incidents raise a crucial question: can AI ever truly be unbiased or accountable when applied to criminal justice?

Read the whole article here

Legal Technology

Recital: Simplifying Contract Management for In-House Counsel

Contracts are the lifeblood of business operations, but for in-house legal teams, managing and reviewing them can often become overly complicated, with scattered documents, endless version histories, and clunky legacy tools. While we can all agree that contracts should ensure businesses achieve the best possible commercial outcomes, the processes involved in contract management can drain time and resources, and oftentimes leads to in-house teams spending days scavenging through their inboxes or document storage systems, or worse yet – relinquishing version control to external lawyers. But this doesn’t need to be the case. 

Enter Recital, an AI-powered contract review and management platform designed specifically for in-house counsel. Could this be the streamlined solution legal teams have been waiting for?

Read the full article here

🆕 5mins.ai - Reinventing Learning, One Micro-Lesson at a Time

🆕 Lawtte - All-in-one AI intake system and reception for law firms.

🆕 JudgeAI - A completely independent and unbiased judicial system without any human interference!

Want more Legal AI Tools? Check out our
Top AI Tools for Legal Professionals

This prompt helps lawyers save time by proactively addressing common client questions in a structured and accessible format. It improves client communication, reduces repetitive inquiries, and enhances overall efficiency in legal practice. Perfect for creating a ready-to-use client resource.

Prompt: Generate a list of frequently asked questions (FAQs) for clients in [specific practice area]. Provide clear, concise answers to each question, ensuring they are easy to understand while covering key legal considerations.

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