YouSaid · the spoken record

Elizabeth T. McCormack

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2026-02-12
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2026-02-12
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  1. I mean, it could be a lot of things. There are a million different ways it shows up, but something was supposed to be completed on a certain timeline and wasn't. And who's responsible for that delay? There might be supplier disputes. There's all kinds of disputes that happen like in the course of a construction project that don't need testimony, right? You can decide them completely on the paperwork. And that was also important for us in starting this in a first offering of an AI arbitrator, we were not prepared to have witness testimony evaluated by agents. That might come one day, but we're not there today. Yeah.

    2026-02-12 · Decoder with Nilay Patel · The surprising case for AI judges · IDENTIFIED FROM THE TRANSCRIPT

  2. Need speed and efficiency. They're not in it for confidentiality. They just need to be able to continue to move forward. It's also an area where AI is already impacting the underlying business, right? The construction sites are being infiltrated with AI that's making what they do significantly faster and better. So it's an industry that we knew would be open to it. And we do so many of those cases. We had a good library of documents only construction cases that we could ground our agents in, you know, our agents are ultimately operating off a handbook, but that handbook we were able to build that and train our agents on those historical cases and with the cooperation and collaboration with a bunch of our construction arbitrators and lawyers. So it was the right place to start because we knew they'd want it and we could.

    2026-02-12 · Decoder with Nilay Patel · The surprising case for AI judges · IDENTIFIED FROM THE TRANSCRIPT

  3. Take the summary of the dispute that the parties are satisfied with and start reasoning across it. And then there are agents that do a draft award. There's a human in the loop throughout. In the beginning, it's the parties. They are the human that are making sure that they're heard and understood. Then we have a cohort of construction arbitrators who serve as the human in the loop arbitrator for the reasoning and award drafting. And it's the human arbitrator who ultimately issues the award and she makes any changes that need to be made so that she's comfortable with the award. We started in construction. We have a long history with the construction industry and a very good relationship with the lawyers and parties and arbitrators in that industry. It's an industry where arbitration is important because as you know in any big project there are always going to be disputes and if you have disputes along the way you don't want your project ground to a halt you want to be able to keep going so they

    2026-02-12 · Decoder with Nilay Patel · The surprising case for AI judges · IDENTIFIED FROM THE TRANSCRIPT

  4. A website, although I assume we will have an app version of it and we have an app version of all of our services. You can log in on your phone, but you're logging into the case management system. So really it's two things. We built an AI native case management system for the AI arbitrator to operate on. That effort is time well spent because it'll replace our legacy case management system for all disputes within two years. Like that's just going to be something everybody has an opportunity to benefit from, which saves time and money. But the AI arbitrator is, like I said, a bunch of different agents, probably 20, sometimes more, depending on the complexity of the dispute that operate across the arbitration process. A bunch operate at the front end. We talked about those that are parsing claims and organizing arguments and organizing claims, making sure the party is satisfied. And then there's a bunch of reasoning agents. And those reasoning agents.

    2026-02-12 · Decoder with Nilay Patel · The surprising case for AI judges · IDENTIFIED FROM THE TRANSCRIPT

  5. Let's talk about your actual product. Right now, I think it's just documents only in construction disputes, right? That's where the product is. Describe why you picked that and then just walk me through step by step. How do you use this thing? Is it an app? Is it a website?

    2026-02-12 · Decoder with Nilay Patel · The surprising case for AI judges · IDENTIFIED FROM THE TRANSCRIPT

  6. We just want an answer. So imagine if courts could do that. Imagine if trial judges or appellate judges could pull the parties in and say, here's my understanding. Did I get it right? And then we could actually like be satisfied that they did. That's probably not going to work in our bespoke built for 18th century norm system, but it can work for disputes in an AI dispute resolution system.

    2026-02-12 · Decoder with Nilay Patel · The surprising case for AI judges · IDENTIFIED FROM THE TRANSCRIPT

  7. Cases a year, 2,000 applications a year when I sat on the Michigan Supreme Court, and I can't tell you how many of them were the intermediate hell court didn't even rule on issue number three. They just ignored it, you know, and we.

    2026-02-12 · Decoder with Nilay Patel · The surprising case for AI judges · IDENTIFIED FROM THE TRANSCRIPT

  8. Party B and what the elements are and what the evidence is and what the legal framework is. And did I get that right? And the parties get to say you did or no, you didn't. You missed this one element or this one claim or the fact that this evidence supports both of these claims, not just one. And then it goes to work again. The agents go to work again until the parties are satisfied that they have been heard and understood. I mean, maybe we could do that in courts, but we would have to spend a whole lot more money. Like imagine if judges in trial courts or even in like appellate courts. In appellate courts, you file briefs and then you wait by your computer for months and months and months to see like when you white smoke emerges from the state Supreme Court building and then you get a decision and the decision may or may not have even addressed all of the issues that you raised. You know, that happens all the time. You know, I reviewed 2000.

    2026-02-12 · Decoder with Nilay Patel · The surprising case for AI judges · IDENTIFIED FROM THE TRANSCRIPT

  9. I do view it as a significant advantage of an AI dispute resolution system. And we can talk more about when that's appropriate, when it's not. I don't think. Every dispute should go to an AI dispute resolution system. But when parties prefer it, it was for me at the front end of what we built, which is a very narrow product right now, but it was, I undervalued it and underappreciated it. So at the front end of our AI arbitration process, which is really a series of agents that operate across the process on the back end, even though the parties are interacting with one, the agents take in the party's complaints and their, you know, whatever pleadings they're filing and whatever evidence they think supports their claims. And then a series of agents like parses the claims, the elements of each claim, the evidence that may or may not support each claim, but the parties believe supports each claim and the legal framework that surrounds it. And then it goes back to the parties and says, here's my understanding of what the claims are, you know, what your claims are, party A and your.

    2026-02-12 · Decoder with Nilay Patel · The surprising case for AI judges · IDENTIFIED FROM THE TRANSCRIPT

  10. If there's one thing an AI system can do, it is just make you feel heard. Like in every positive way that that can happen, in a startling number of new and quite frankly shocking negative ways, the AI systems will just listen to you over and over and over again. Is that something as you have developed the AI arbitration system? Is that something that you've leaned into? Is that the heart of it? Because that feels like, well, if the technology can do one thing, it is just listen to these parties until they're done.

    2026-02-12 · Decoder with Nilay Patel · The surprising case for AI judges · IDENTIFIED FROM THE TRANSCRIPT

  11. The one thing I will definitely say here is in my mind, we cover big tech companies. I am just thinking about the clauses that everybody has to sign in their terms of service agreements. And you're obviously thinking about employment arbitration. And there's like different universes. Another week we could spend on is I think terms of service agreement should be illegal. But that's a different podcast for a different time, maybe with more booze. You're mentioning the fact that people just feeling heard leads to trust, I think is the transition I want to make to AI. You mentioned that idea to me the first time we spoke about this. I've been thinking about it ever since.

    2026-02-12 · Decoder with Nilay Patel · The surprising case for AI judges · IDENTIFIED FROM THE TRANSCRIPT

  12. Right? Like you want to grow trust and in every case, usually one person is disappointed. That's just how disputes go. I'm not sure I agree with you that getting some award isn't important. There's data, a bunch of arbitration. Quite high. Maybe not surprising to you. And that's just simply doesn't happen in employment. In arbitration, you're far more likely to actually get to go tell your story. I'm not sure I agree with you that there's like a clear fairness narrative based on the facts

    2026-02-12 · Decoder with Nilay Patel · The surprising case for AI judges · IDENTIFIED FROM THE TRANSCRIPT

  13. Because I think, you know, and I'm not going to speculate about why, but I think parties are always thinking about what the best forum is. You know, there's like a robust literature on procedural fairness, procedural justice that goes something like this. I won't waste time on the details of it, but if parties feel like they were heard and that they understand the process, they understand like what happened and why it happened. In other words, if the neutral deciding the dispute can explain it to them, they're far more likely to grow trust in institutions. It used to be a sort of a big deal in training judges. We would remind judges how important it was that people feel heard. And even if you're going to rule against them, they will take bad news for them and still grow trust in the institution if they feel heard and understood and they understand what happened. And that matters because today's parties or tomorrow's witnesses and tomorrow's jurors.

    2026-02-12 · Decoder with Nilay Patel · The surprising case for AI judges · IDENTIFIED FROM THE TRANSCRIPT

  14. That's not true of in plea arbitration. Those cases are reported, so they actually do have to live with those results. And it may well be that for some businesses, they're choosing arbitration because it's a more efficient way for them to resolve disputes. I don't know. You know, you see them going back and forth between arbitration and litigation. I think like Amazon recently. Wrote litigation back into all of their consumer, maybe not all, but a lot of their contract.

    2026-02-12 · Decoder with Nilay Patel · The surprising case for AI judges · IDENTIFIED FROM THE TRANSCRIPT

  15. The idea that just getting a hearing and some outcome is substantially more fair, I feel like we could unpack that for another week. There's a reason these companies want to not be in the formal justice system, right? They don't want precedent for the awards that they're made to give to the parties that come and sue them. They certainly don't want it in the public record that any of these things ever happen. They don't want discovery. All that stuff you don't have to do in arbitration. So maybe it's easy to participate in, but there's still a benefit to them that accrues over the long run. How do you balance that out?

    2026-02-12 · Decoder with Nilay Patel · The surprising case for AI judges · IDENTIFIED FROM THE TRANSCRIPT

  16. Starting with this issue of fairness because I feel like when you automate the systems, all of the things that make things feel fair or unfair get heightened, get magnified in very specific ways. And I just want to ask one more question here. And then I do want to go into why should we automate some of these systems?

    2026-02-12 · Decoder with Nilay Patel · The surprising case for AI judges · IDENTIFIED FROM THE TRANSCRIPT

  17. And parties are heard in arbitration than they are in courts. But that perception definitely is out there. And it may well be the case that there are other providers that have fewer resources for self-represented parties or aren't as focused on at the AAA. We actually require businesses that want to put our clauses in contracts to file those contracts with us and they have to satisfy our due process protocols. And I'm not sure that's true of every organization. Many are for-profit and that is probably an issue in other places.

    2026-02-12 · Decoder with Nilay Patel · The surprising case for AI judges · IDENTIFIED FROM THE TRANSCRIPT

  18. To the second part of your question, I do think that there has been a narrative that if your consumer contract, whether you bought an appliance or a cell phone or sometimes employment contracts, designate arbitration as the forum for resolving disputes, that that must mean this is not going to go well for you. In fact, the data that we have is that people are far more likely to actually get a hearing and get some award when they navigate an arbitration process than when they navigate a court process. And the reason for that probably is obvious. If you have to navigate a court process, but you can't figure it out, that's really complicated. You know, in an arbitration, we can make resources available to parties who are representing themselves and do everything remotely, make it easier for people to actually navigate it. So cases are far more likely to actually go to a hearing.

    2026-02-12 · Decoder with Nilay Patel · The surprising case for AI judges · IDENTIFIED FROM THE TRANSCRIPT

  19. It's in Latin and you can't understand it. Like, we would never accept that. But we accept that most Americans are locked out of their formal justice system because they, I don't know why, because we set up a legal system 250 years ago and the legal profession is better than any other at avoiding any disruption.

    2026-02-12 · Decoder with Nilay Patel · The surprising case for AI judges · IDENTIFIED FROM THE TRANSCRIPT

  20. Yeah, so let me unpack a couple of things you said. I completely agree that the declining trust institutions is the courts are part of that problem. And in fact, the National Center for State Courts kind of tracks that. And I think their data shows declining trust in the courts. Frankly, that declining trust is faster in the federal courts than the state courts. But even the state courts are struggling with that. I happen to believe that the way most Americans are locked out of our formal justice system is as important to that declining trust as any other factor. And there are other factors. Imagine like any other public good, you know, imagine if we said if you want to drive on the highway, you can do that, but you have to hire a driver. Or, oh, you want to register your kid for public school? No problem. It's a public good, but you're going to have to hire a special person who will go sign you up for public school because otherwise.

    2026-02-12 · Decoder with Nilay Patel · The surprising case for AI judges · IDENTIFIED FROM THE TRANSCRIPT

  21. Because I do feel like the lack of faith in our corporate institutions is equally high. And most people's experience with arbitration is, well, I just need cell phone service. I'm not going to read this contract or these 15 contracts to get my cell on service. And there's a line here that says, well, I can't even sue AT&T if they get something wrong. I'm going to end up in arbitration and that arbitration is obvious, like, of course, it's just going to be against me. Like, there's nothing I can do. I'm just signing away my rights. How do you feel about that in this context? Because that feels like as big of a problem as anything.

    2026-02-12 · Decoder with Nilay Patel · The surprising case for AI judges · IDENTIFIED FROM THE TRANSCRIPT

  22. The reason I'm starting here is I think you perceive this as well as I do the lack of faith and trust in our institutions is kind of pervasive across American society. And the legal system is just part of it now, right? Especially if you show up and you don't have a lawyer, you don't have the money, and then it is a weird old guy and a judge, and then you're looking at the statistics, and they're probably wrong, but you can't afford to appeal or you're just reading the headlines every day. It just feels like there's more chaos in the formal legal system than ever. And I wanted to start there.

    2026-02-12 · Decoder with Nilay Patel · The surprising case for AI judges · IDENTIFIED FROM THE TRANSCRIPT

  23. Know if it's going up. I could probably figure that out, but I don't know that off the top of my head. It is the fact that it's quite high. The number of cases where an appellate court reverses the work of a lower court is not a low number. It's going to be different from state to state and different in the federal appellate courts, but you can benchmark it and it's not an insignificant number. I like to use the example of, I ran a non-DNA innocence clinic two careers ago. We know a lot about the rate of wrongful conviction as a result of the DNA exonerations over the last, I don't know, 30 years at this point because there's a database now and we've been able to learn both like the rate at which mistakes are made. Sometimes they're made by juries, but often they're made by judges and the kinds and quality.

    2026-02-12 · Decoder with Nilay Patel · The surprising case for AI judges · IDENTIFIED FROM THE TRANSCRIPT

  24. Wrong for. Rate of reversal is just to unpack that. What you mean is someone goes to court, a state court judge decides there's an appeal, which costs money, and that goes up to an appeals court and the appeals court is overturning that judge. And you're saying that right's going up or that rate is too high

    2026-02-12 · Decoder with Nilay Patel · The surprising case for AI judges · IDENTIFIED FROM THE TRANSCRIPT

  25. Careful, very clear that there's a big difference between state and federal court, right? 95%, 96% of cases are heard in state courts, not federal courts. I mean, the federal courts do a very, very small, a much smaller number of cases and generally have larger staff to help them. State courts are managing most disputes with fewer resources and doing the best they can. But if you look at the rate of reversals by appellate courts, by intermediate appellate courts and state supreme courts, they're getting a lot wrong, right? So, you know, humans get things wrong for lots of reasons. Yeah.

    2026-02-12 · Decoder with Nilay Patel · The surprising case for AI judges · IDENTIFIED FROM THE TRANSCRIPT

  26. I don't think there's a single answer. I do think the fact that 92% of Americans can't afford help with their legal problems, and that's not just the kinds of cases individuals end up going to court for. It's also true for all small and medium businesses for the most part can't afford lawyers. So there's an awful lot of trying to navigate legal risk and legal problems without lawyers. And that's complicated. That's actually, you know, frankly, very complicated for judges, judges who are managing large dockets with many, many parties without lawyers try and do their best to work their way through those problems. But it's not easy. But I do think the fact that we have a legal system run by humans and humans are imperfect and busy. I want to be very

    2026-02-12 · Decoder with Nilay Patel · The surprising case for AI judges · IDENTIFIED FROM THE TRANSCRIPT

  27. In making sure there was less ambiguity in statutory terms, I think. So I think AI could impact that. But there are even still modern questions about historic provisions in statutes and constitutions, state and federal, that we have entrusted judges to decide. So I don't think it can all be deterministic. I think an awful lot could be, and it would improve the way the law operates.

    2026-02-12 · Decoder with Nilay Patel · The surprising case for AI judges · IDENTIFIED FROM THE TRANSCRIPT

  28. Therefore, it isn't always predictable if it were more predictable, we would be a more efficient and effective system. We'd avoid a lot of disputes because people could plan their business around what in fact the rule was going to be and how it was going to be enforced and how they could count on it being enforced. That's true for, in my view, most cases for which there is a rule of law and we know how it's been interpreted historically or at least how it's been correctly interpreted historically by majority of courts there are always going to be new frontiers in legal so you know cases where courts are having to decide how to interpret a new statute courts are going to have to figure that out for the first time that's not going to be able to be deterministic I mean could get better and better frankly I think AI could do a very good job at the front end of statutory drafting in

    2026-02-12 · Decoder with Nilay Patel · The surprising case for AI judges · IDENTIFIED FROM THE TRANSCRIPT

  29. So it absolutely should be, at least in a majority of cases. In fact, if it were more deterministic, we would have fewer disputes, right? It's because it's probabilistic, and I agree with you. for the most part is because it's run by humans who are you've met humans right they're flawed

    2026-02-12 · Decoder with Nilay Patel · The surprising case for AI judges · IDENTIFIED FROM THE TRANSCRIPT

  30. Curious about that because it feels like the experience you had there really leads to your perspective on how and why AI should enter the legal system. The reason I'm starting here with your previous experience and not your current job is I encounter this on our show and on our site all the time, that people think the legal system is deterministic. Like particularly our audience, the tech audience, thinks the legal system is a computer, right? You can feed it inputs and it'll API access the law and then you'll get some predictable outputs. And I'm always trying to convince people that that's not the case. And just even hearing you talk about the politics of running the legal system underlines for me that the legal system is absolutely not deterministic. Should it be?

    2026-02-12 · Decoder with Nilay Patel · The surprising case for AI judges · IDENTIFIED FROM THE TRANSCRIPT

  31. I would say the administrative part of the job was significantly more than half than the decisional part of the job. It's an enormous job. Yeah. I mean, Michigan adjudicates between three and four million cases a year and like every other state court, a majority of people who go to court to have cases resolved can't afford lawyers. This is the primary place people interact with their government. So the kind of justice we deliver, the quality of justice we deliver is Pretty important to frankly like the rule of law and you know trust in institutions and so I think it's you know one of the most important jobs in government

    2026-02-12 · Decoder with Nilay Patel · The surprising case for AI judges · IDENTIFIED FROM THE TRANSCRIPT

  32. Differently resourced, right? So some counties have a larger tax base than others, and they have a bigger budget to work with. So convincing separately elected judges with different budgets that we're going to do business a certain way going forward is super complicated.

    2026-02-12 · Decoder with Nilay Patel · The surprising case for AI judges · IDENTIFIED FROM THE TRANSCRIPT

  33. Based on how well you do, right? You can't perform well one year and have extra revenue for RD. You have to walk over to the legislature and convince some brand new representative from Lelanaw County that online dispute resolution is really going to increase access to justice. And you literally have to like pick off legislators from around the state to try and fund what you know is going to be a better way of doing business. And at the same time, the judges across the state in Michigan, there are approximately a thousand judicial officers, I say that because in addition to judges, there are magistrates that report up. They're all separately elected and they work in counties that have their own funding system. So they're partly funded by the state. They're partly funded by their county. And the counties across Michigan are

    2026-02-12 · Decoder with Nilay Patel · The surprising case for AI judges · IDENTIFIED FROM THE TRANSCRIPT

  34. So, the thing about being the Chief Justice of the Michigan Supreme Court is like every state Supreme Court, the Supreme Court has administrative oversight of all the courts of the state. And so when you're the Chief Justice, you're kind of the CEO of the public dispute resolution system that most people are stuck dealing with if they need a little justice or somebody wants a little justice from them. Like other leadership roles, I had a leadership team, another, you know, 300 or so staff folks who reported up to the leadership team. And it was our job to try and figure out how to improve the experience of people across the state of Michigan who had to go to their local courts because of some legal problem. It's an enormous change management job for lots of reasons that are not true in my current job. The thing about running the public dispute resolution system, the state court system is your funding isn't

    2026-02-12 · Decoder with Nilay Patel · The surprising case for AI judges · IDENTIFIED FROM THE TRANSCRIPT

  35. And I were on a panel a while ago. You were talking about rolling out AI in arbitration. You're talking about history overseeing judges in Michigan, which was very funny. I'm very excited to talk about all of that with you. I just want to start at the very beginning. I suspect you and I are going to end up talking a lot about commercial disputes, business disputes. There's a lot there to discuss in the context of AI and arbitration. Most people's experience of arbitration is like they just sign a contract. You were the chief justice of Michigan. You oversaw the literal legal system in that state. Now you overseed, I think the arbitration association is 100 years old. You oversee a hundred year old dominant provider of arbitration. Explain to people what the difference is.

    2026-02-12 · Decoder with Nilay Patel · The surprising case for AI judges · IDENTIFIED FROM THE TRANSCRIPT

  36. Welcome to Dakota. I'm Nilai Patel, editor in chief of the Verge. And Decoder is my show about big ideas and other problems. Today we're going to talk about the role AI might play in deciding legal disputes, not just doing research and drafting memos, actually deciding who's right and who's wrong and who should pay. My guest today is Bridget McCormack, the former Chief Justice of the Michigan Supreme Court and now the president and CEO of the American Arbitration Association. You've probably heard of arbitration before. It's a form of dispute resolution that allows two parties to resolve conflicts outside of the formal court system using a third neutral party, the arbitrator, to negotiate a settlement. You may have never found yourself in arbitration, but you've almost certainly signed an arbitration clause in one of the many contracts in terms of service agreements that all of us have to sign all the time. Arbitration can be much faster, cheaper, and easier than going to court, so it's become a favored way of resolving disputes between

    2026-02-12 · Decoder with Nilay Patel · The surprising case for AI judges · IDENTIFIED FROM THE TRANSCRIPT