AI-Powered Tech Opens Potential for Affordable Legal Help

Legal technology innovators are getting creative to bring AI-powered tools to the masses.

Generative AI is expensive, so tech vendors have to find clever ways to pay for it if they want to give it away cheaply or for free. They’re borrowing legal tech from startups, handing out free versions of enterprise software, and offering pay-as-you go services to small businesses and giant corporations alike.

AI enthusiasts believe these efforts will expand access to legal services, potentially enabling a wider group of people and businesses to solve their problems without paying for a lawyer. The technology could close the gap between those who can pay for any lawyer they want, and those who don’t have that option.

“Generative AI has more potential to improve access to justice than any other development I’ve ever seen,” said James Sandman, president emeritus of the Legal Services Corporation.

There’s no guarantee that potential will be reached. Venture capitalists are investing hundreds of millions of dollars into legal technology for Fortune 500 companies and Big Law firms, leading some justice access advocates to worry that the technology will lead to AI-powered super lawyers at the top and little benefit to others. Impact-focused work doesn’t usually generate the quick profit that some investors want, and free AI chatbots have pitfalls as legal-specific tools.

“If pricing isn’t addressed, artificial intelligence actually presents the risk of widening the justice gap because it will make cool new tools available to rich clients and their lawyers that are off limits to low-income people and their lawyers,” said Sandman, a former Arnold & Porter managing partner.

Some legal tech companies are using their top-shelf software to subsidize cheaper or free versions. The eDiscovery company Everlaw, whose corporate clients include United Airlines and HP, also has relationships with 200 nonprofits, law schools, and other organizations that access their tech via Everlaw for Good. The free legal housing tool Roxanne is powered by the AI behind Josef, which counts L’Oréal and Bumble among its clients.

“This opportunity for AI really is a generational opportunity,” Joanne Sprague, the head of Everlaw for Good, said. “But I don’t think it’s a foregone conclusion that this is going to be good for legal aid or broader society.”

Chatbots Aren’t Enough

General-purpose AI chatbots, while widely available, aren’t a perfect alternative to AI legal tools. Anyone with an internet connection can access free versions of top chat bots including ChatGPT, but those tools haven’t been trained as much on legal-specific data and have been responsible for many notable hallucinations in court documents. The makers of legal-specific AI tools try to cut back hallucinations by having lawyers check AI-generated outputs or by making the AI provide links to source materials.

The threat of general-purpose chat bots inundating courts was one reason Garfield AI secured regulatory approval to provide assistance in small claims court, its founder, Philip Young said. Garfield uses AI to provide legal documents for debt collection in England and Wales.

“If people don’t have access to a regulated solution, they’ll just go to an unregulated thing, like a consumer grade ChatGPT product,” Young said. “And they’re really worried about that because of the number of people walking up in front of judges who’ve just run their case through ChatGPT.”

Young, a former partner at a litigation UK boutique tapped some friends as angel investors.

Small businesses and large corporations use Garfield, and it’s priced to be accessible, Young said. Instead of a subscription model, it charges by the document: A polite letter asking for repayment costs £2, or just under $3.

A Chase for Dollars

Many legal tech companies are backed by venture capitalists who are looking for a quick return and expect companies to scale up quickly, Kelly Bryan, director of US ventures at Village Capital, said.

“The incentives from VC end up creating a growth-at-all-costs mentality which is not ideal for an impact-minded entrepreneur,” Bryan said.

Everlaw and Robin are among the legal tech companies that have raised big sums from venture capitalists. Enterprise software sales bring in revenue, but both companies also have free versions.

Robin has sold its contract review software to companies including PepsiCo Inc., PwC, and Yum! Brands Inc. But it also offers a free version that has more users than the paid version, a spokesperson said.

“I believe that legal advice is too expensive, and with the right technology it can be considerably cheaper, faster and simpler,” Robin CEO Richard Robinson said in a statement on the company’s website. “And I believe that addressing these problems is critical if we want to empower people to protect themselves and to restore trust in the legal industry.”

Depositron and Roxanne are bringing legal services to New York City tenants without direct lawyer involvement. Depositron, which recently launched statewide and has about 500 users, helps people get their security deposits back by generating a letter to landlords from a user’s phone. Nori partnered with LawDroid, an AI legal assistant platform, to create Depositron.

Roxanne, which launched at the beginning of the year and has about 5,000 users, helps tenants with issues like housing repairs.

“No one wakes up in the morning and says, ‘I hope I meet a lawyer today,’ ” said Sateesh Nori, the legal aid attorney who founded Depositron and Roxanne. “But they say, ‘I hope my problem gets solved.’ ”

Nori said he’d like to explore other ways to pay for low-cost legal services. About 200,000 people move in New York City every year, and if enough of them pays a few dollars to use Depositron, it could be self-sustaining, Nori said.

“We have this moral imperative to be the best we can with what we have, which includes these AI tools,” he said.