Investor overview
Confidentiality is not
a constraint. It is the product.
Zero-transfer litigation AI with a frontier-quality escape hatch — every safety invariant enforced by the build, not by convention. A practice the attorney owns outright, designed from the rules upward.
Confidential overview — figures are plan, not results.
Pre-revenue. The invariants and the working prototype exist; the full agent set is in active development. Figures below are the plan, and the risks are listed with them.
The problem
The sanctions wave meets the privilege problem
Two separate liabilities, not one: fabricated citations (sanctions, Rule 11) and disclosure to a third party (privilege waiver, HIPAA). Most vendors answer only the first.
Purpose-built tools are no safe harbour
Sanctions have reached users of major commercial legal platforms. The exposure is not hypothetical and it is not shrinking — it is being written into court records, quarter by quarter.
Privilege is the second liability
Personal-injury and employment practices carry HIPAA and privilege duties at once: every cloud call with PHI or work product is a potential disclosure. A federal court has already held a public-chatbot exchange not privileged — the data went to a third party.
The solution
The privilege boundary is code, not policy
- Seven agents in a pipeline — intake → documents/OCR → timeline → research → drafting → verification → attorney review. Tireless paralegals, each with one job, all supervised.
- Cloud calls carrying protected content are blocked by default — prohibited unless deliberately, verifiably permitted.
- Every assertion is grounded — each citation points to a specific source file and page. A witness testifying only from documents in evidence.
- Claim-by-claim verification before any human sees the draft — anything unsupported is flagged [VERIFY].
- Nothing is filed automatically — a licensed attorney reviews and signs every output. The system cannot submit or send on its own.
- Measured, not claimed: on a twelve-claim controlled set from our synthetic matter, the verifier flagged both a planted $3,800 billing overstatement and a fabricated assertion, passed all ten sound claims, and backed every pass with a verbatim quote checked against the source. Local model, no cloud. Twelve claims is a first measurement, not a validated rate — and our drafting stage does not yet emit citations, so the end-to-end run is not yet demonstrable.
Why now
Frontier-class AI finally fits on a desk
Until recently, privilege-grade AI meant a painful trade: weak local models, or frontier cloud models with confidentiality risk. A desktop AI machine with 128 GB of unified memory now runs a 120-billion-parameter model entirely inside the office.
The trade-off structurally narrowed
Drafting and verification now run at credible quality inside the firm’s walls, on hardware the firm owns and can unplug. The cloud becomes optional rather than mandatory — used only where frontier quality genuinely matters, and only through the de-identification gateway.
A hardware-timing story, not a research bet
The architecture was always right; the hardware finally caught up. A $4,699 device now hosts models that needed a server room two years ago. We are not betting on a research breakthrough — and hardware is a low-single-digit share of the raise.
Compliance
Three shields
The architecture was not built first and checked against the rules afterwards — it was derived from them.
HIPAA
- Fully local mode: PHI is never disclosed to any third party
- The hybrid cloud path runs only under a signed BAA plus zero data retention
- De-identification precedes any transfer
Bar ethics
- Generative AI is permitted subject to confidentiality, supervision and honest billing
- In-house AI that discloses nothing to a third party removes the core confidentiality problem
- The AI is supervised as a non-lawyer assistant (Rule 4-5.3)
Rule 11 / sanctions
- Every assertion grounded in a source file and page
- Claim-level verification against a verbatim-quotation standard
- Mandatory attorney signature — the record of reasonable inquiry is built in
Engagement letters disclose AI use expressly; audit logs substantiate every claim made about it. Citations should be verified by counsel before use with a bar audience.
Structure
The lawyer owns the practice
Two entities by design: a 100% attorney-owned PLLC that practises law, and a technology MSO paid in fixed, fair-market fees.
PLLC — practises law
100% owned by a licensed attorney- Owns every client relationship
- All legal judgement, case selection, fee setting and signatures live here
- Technology is staff, not a partner
MSO — sells infrastructure
Owns platform, hardware and IP- Co-owned by the operators; the attorney holds equity too
- Paid in fixed, fair-market fees only
- Never a percentage of legal fees; no participation in case decisions
The bright line — no fee splitting, no non-lawyer control. Follows Texas Ethics Op. 706 and Fla. Rules 4-5.4 / 4-5.7, and deliberately inverts every fact of the TIKD case: only the lawyer selects matters, sets fees and directs representation. Stated honestly: Florida has no MSO-specific opinion yet — an advisory opinion request is planned before scaling.
Business model
Two engines, one flywheel
The owned practice
- Personal-injury and employment matters — the pipeline compresses a 15–25 hour demand package into a few hours of attorney review
- Revenue: standard contingency fees
- Every matter proves the product on real work
The MSO platform
- The same kit, white-labelled for other firms as a preconfigured appliance plus service
- Never a share of their recoveries
- Recurring revenue smooths the contingency cycle
The flywheel
- Every matter enriches a de-identified outcome corpus no national vendor has
- Each engine strengthens the other
- The moat is the licensed-firm wrapper plus the data plus the position of trust — not a model, which commoditises
The plan
Twelve months to revenue-ready
Headline figures from the seed plan. The full P&L, hiring schedule and use-of-funds reconcile line by line — available under NDA.
| When | Milestone |
|---|---|
| Month 1 | Entities formed and papered; hardware received; insurance bound; pipeline migrated; first owned matters opened |
| Day 90 | Fully-local quality verdict on real matters → product positioning decision (local-only versus hybrid) |
| Months 3–6 | De-identification layer hardened; 2–3 MSO partner firms signed; caseload carried with paralegal support |
| Months 6–9 | Associate attorney onboarded; workstations evaluated as they ship; MSO appliance packaged |
| Month 12 | Production pipeline on live matters + first white-label MSO deployment running; first settlements arrive |
Risks
Stated plainly
Mitigations are implemented or budgeted, not promised.
| Risk | Mitigation |
|---|---|
| Regulatory | Florida has no MSO-specific opinion; an adverse reading is possible — met with strict fair-market papering, attorney control, and a pre-emptive bar advisory opinion request |
| Model quality | Local models trail the best cloud models on the hardest persuasive drafting — which is exactly why hybrid mode exists; the 90-day verdict decides on data rather than hope |
| Revenue timing | Contingency revenue is back-loaded and year one is capital-intensive even optimistically — recurring MSO revenue is the smoothing engine |
| Hardware timing | Workstations are announced but not shipping and device prices are volatile — a budgeted reserve line covers it; attorneys work on existing PCs until devices arrive |
| Verification limits | No automated checker is ever 100% — attorney oversight is structural, not optional: nothing is filed without a human signature |
| Build maturity | The reasoning agents are not yet written; the invariants are. The order is deliberate — the boundary and the audit chain cannot be retrofitted, the agents can be built on top of them |
Next step
A structure session and a live demonstration
The strongest close available is the one claim that can be tested in the room: a live run of the verification gateway on a matter whose answer is already known.
Request the full deckFull P&L, hiring plan and use-of-funds are shared under NDA. Write to hello@lexvault.associates, or see the product overview for law firms.