TL;DR
AI is creating a two-sided problem for lawyers. Clients are arriving with inflated expectations from ChatGPT consultations, while firms wrestle with how AI-driven productivity gains will affect the billable hour — their primary revenue model.
The WebMD Effect, on Steroids
“It’s like the WebMD effect on steroids,” says Dave Jochnowitz, partner at Outten & Golden. “ChatGPT is telling them ‘you got a killer case.’” But the models don’t understand the full legal context, applicable laws, or case history. Lawyers say clients often arrive with a false impression of what’s possible.
The disconnect creates trust problems. “It makes people not believe what you’re saying,” says personal injury lawyer S. Randall Hood. When a chatbot has already told a client they have a strong case, a more measured assessment from their actual lawyer can feel like bad news.
Firms Are Experimenting — Carefully
Law firms are beginning to use AI to sort through and draft documents. “Staying up all night and copying provisions into a master Excel doesn’t need to happen anymore,” says Aubrey Bishai, chief innovation officer at Vinson & Elkins. But she notes that people aren’t working less — they’re redirecting time to more substantive issues.
The market reacted sharply when Anthropic released a new legal product, sending shares of LegalZoom and Thomson Reuters down. But ETH Zurich law professor Elliott Rush called the reaction “probably a bit over the top,” noting that the product handles document analysis but isn’t connected to case law databases. “There isn’t yet a new product that’s all of a sudden going to replace a lot of legal software.”
The Billable Hour Question
As AI speeds up routine tasks, the billable hour faces an existential challenge. The American Bar Association has made clear that lawyers cannot bill for more time than they actually spend on a task — even if AI makes that task faster.
But observers caution against expecting rapid disruption. “There are going to be some big claims about what can be done. A lot of them will turn out to be vaporware,” says law professor J.H. “Rip” Verkerke at the University of Virginia.