Whether it’s a small practice or a large firm in a metropolitan area, growing a legal business has always been about scaling. Previously, this was done through traditional methods like software improvements, lead generation optimization, and streamlined onboarding practices.

Today, AI is poised to drastically improve how firms can scale in those areas. But not only that, AI is starting to be used for core legal work which was previously only within the domain of lawyers and paralegals.

This leads to some interesting operational and ethical questions for almost every law firm operating today. 

The impact of AI on professional services is now well beyond the theoretical phase. Top law firms are either actively implementing AI or creating implementation plans to do so soon.

Besides the upsides, some negatives need to be considered when using AI for legal work. Regulatory, ethical, and client perception all need to be taken into consideration to avoid the potential drawbacks that AI can bring.

In this guide, we will outline the current state of AI in the legal field and explore areas you need to be most aware of to navigate this new technology.

AI By The Numbers

Depending on the media outlets you follow, it may seem like every business is integrating AI technology at every level. But to truly get a sense of where the legal community stands on AI, it’s worthwhile to dive into some solid numbers.

Starting with an overview of the legal AI landscape, nearly 75% of lawyers are integrating AI into their practice in one form or another, according to the American Bar Association. That’s a significant number, and it’s also an increase from the previous year.

Digging a little deeper, we find that a majority of those AI integrations (54%) are used to help create correspondence. This is likely due to the fact that using AI or chatbots for simple writing tasks is easily accessible and even free in many cases. Writing tools are included in some legal-specific AI software services, but they can be easily accessed on their own via free platforms from OpenAI (ChatGPT) or Anthropic (Claude).

When we look at using AI for firm-specific tasks, the numbers decrease. 14% say they currently use AI to deal with firm matters such as billing, marketing, or other purposes outside of legal tasks. So, there are still many firms that are not using AI for these more complex tasks.

One interesting piece of data is that AI adoption differs greatly based on the size of the law firm. Those firms with 50 or more lawyers had an AI adoption rate of 39%. While firms with fewer than 50 lawyers had an adoption rate of only 20%, according to the survey.

This is likely due to the smaller firms not having the technical resources to properly integrate AI at this stage. Despite AI getting trillions of dollars in funding, there are still only a few turn-key solutions for integrating AI directly into specific business workflows, leaving many smaller firms to cobble together their own solutions. This requires the technical prowess to do so, and some firms may simply not have it.

Smaller firms may also find it difficult to justify the costs of turn-key solutions until they have more data on how the tools perform. They also want more proof that the ROI is more of a guarantee than just a marketing promise from the vendor.

Where AI Is Making The Biggest Impact For Law Firms

Client Intake and Lead Qualification

This is a low-risk, high-impact area where firms can leverage AI. By streamlining these aspects of a practice, it makes for easier scaling and growth without the need to bring on new employees.

Commercial Options:

• Whippy AI: A conversational AI platform that helps law firms automate client intake, scheduling, and follow-up through SMS and messaging.
• Smith AI: A virtual receptionist and client engagement service offering 24/7 call answering, chat, and lead screening for law firms.
• RunSensible: An all-in-one CRM and practice management software designed to streamline operations, communications, and billing for legal professionals.
• Lawmatics: A legal CRM and marketing automation platform that helps law firms manage client intake, nurture leads, and track analytics to grow their practice.

Billing

AI tools for billing and expense analysis help firms monitor costs more effectively and identify opportunities to improve efficiency and reduce waste.

Commercial options:

• Billables AI: An AI-powered tool that helps attorneys capture billable hours automatically by analyzing emails, calls, and calendars for time-tracking.
• MyCase IQ: An intelligent feature within the MyCase platform that leverages AI to enhance case insights, document review, and legal research.
• Clio: A leading cloud-based legal practice management platform that provides tools for case management, billing, client communication, and document storage.

Document Review

In cases with extensive discovery, AI document review can provide immense time savings and efficiency. This can lower costs but also improve service, as you can go over more documents than you otherwise could.

This process still demands diligent legal oversight to ensure all documents are accounted for and that the AI accurately identifies all relevant evidence.

Commercial Options:

• Luminance: Uses AI to streamline contract review, due diligence, and document analysis for law firms and corporate legal teams.
• Harvy AI: Acts as a generative AI legal assistant to help draft, research, and analyze legal documents and cases efficiently.
• CoCounsel: An AI-powered legal research and drafting assistant designed to enhance productivity in litigation and transactional work.
• Diligen: Automates contract review and due diligence with AI-driven insights and clause extraction to save time and reduce errors.
• Spellbook: Integrates with Microsoft Word to help lawyers draft, review, and analyze contracts faster using AI suggestions and insights.
• Everlaw: Provides a collaborative litigation and investigation platform combining document review, case management, and AI-powered discovery tools.

Potential Problems From AI Adoption

While AI shows a lot of promise for law firms, other industries that have adopted the technology have uncovered various problems that can arise along the way. The legal field is not immune to these issues, and in many cases, there are additional consequences lawyers should be aware of.

Devaluation of Services

Something that has been documented across various creative fields is that AI tends to devalue the work, even if that work is not directly replaced by AI. For example, the fields of graphic design, writing, voiceover talent, and animation are seeing the value of their work decrease.

Even when companies are still hiring humans for these roles, the fact that AI can do some or all of the work lowers the value of the underlying human work, which in turn reduces wages. 

For lawyers, this is more of a long-term concern. But if more and more work at a firm is being done by AI, clients may start to take the same stance as those hiring graphic designers and voiceover artists.

Clients may begin to ask why they are paying the same fees as before when half the work is now done by AI.

The solution to this potential problem is for lawyers to provide unique value in other areas. That can mean more one-on-one time with clients or the need to show clients why your services provide more value than other firms.

This situation is not unique to law firms, and most professional services will need to find ways to increase the value proposition of their services as AI drastically improves productivity and allows lower-cost competitors to enter the market.

Ethical Concerns

The ethical concerns of AI come about when lawyers start using the tools for direct casework. This is a gray area with AI, as it can be hard to draw the line between activities such as research and actual case building.

Competent representation, as outlined in ABA Model Rule 1.1, requires that lawyers fully understand the technology they’re using and its limitations. 

Model Rule 5.3 stipulates that lawyers must supervise any work done by non-lawyers, which can include software and AI in many use cases.

With the current gray area that AI is creating in legal work, it is easy to unknowingly violate ethical or regulatory guidelines while putting a case together.

Privacy Concerns

Due to the nature of how AI works, all information must be sent to the cloud for processing. Since AI uses natural language, that means most of this data is not encrypted in any way as it moves back and forth.

Another issue that arises from AI’s use of natural language is that anyone who gains access to the system can easily search for specific data using natural language queries. For example, if someone gained access to a firm’s AI account credentials, they could simply ask for a list of cases for various clients. In the world before AI, this would take data mining and IT skills, but today you can simply ask the AI platform in plain English.

Many law firms deal with highly sensitive information, and by regulation, they must make a reasonable attempt at safeguarding that data. Some current integrations of AI may not meet that reasonable standard in certain cases.

Inherent Bias Within The AI Model

The headlines have been filled with stories of public AI models showing a variety of biases. Sometimes these biases are comical, but other times they can be offensive and dangerous. An AI model for legal work is no different, and it may have biases that the user is not aware of.

Most AI software vendors are simply creating an interface that then plugs into one of the larger LLM models, such as Claude or ChatGPT. So, any biases or issues in those larger models will filter into the AI tools sold to lawyers.

AI bias can go both ways when working in a legal context. Certain safeguards in place may prevent the AI from truly understanding sensitive topics or might ignore those altogether based on internal training.

Legal-specific integrations such as Harvey AI, which uses ChatGPT, can be susceptible to this type of situation where certain data is not presented to the user, and there’s no way to know the information has been withheld or modified.

To deal with this, lawyers should understand that working with AI models for case research requires extensive prompting. You have to treat the AI model as an adversary and question its output until you’re satisfied.

For example, directly question the model when it provides you with information. Ask if any information was withheld or is missing. Ask it for more details if you’re unsure about what it’s presenting.

One of the biggest mistakes lawyers make when adopting legal AI workflows is not sufficiently prompting the AI after the initial information is obtained. This happens because many lawyers are used to the more traditional “search” approach, where you don’t interact with the search tool on a deep level.

But with AI, you can think of it almost like a cross-examination. Keep probing until you’re satisfied with the answer.

Creating A Plan To Integrate AI Into Your Practice

Adopting AI in a law firm does not have to start with high-risk legal analysis or case prediction models. The most effective implementation plans begin with administrative and client-facing functions where the benefits are immediate and the risks are lower.

Start with administrative, marketing, and billing tasks first. These can provide an immediate productivity boost, and most options are within the budget of both large and small firms.

Ease into integrating AI research with your current legal workflows. It’s common for lawyers to adopt an AI tool and immediately start using the AI to create documents. This can lead to embarrassing problems, such as the viral case of the New York lawyer who left various ChatGPT hallucinations in a legal brief.

Understand the AI models and how they work. This includes learning how to prompt models to get the results you want. Understand that legal AI tools are based on probability, which means two people can ask the same question and get different answers. Carefully prompt and confirm all information manually.

After implementing any new AI tool for casework, audit your new workflow to ensure you’re not violating any ethical or regulatory guidelines due to automation by the AI.

As artificial intelligence continues to reshape the legal landscape, firms of all sizes have an opportunity to use this technology to enhance their services while maintaining the trust and integrity clients expect. By approaching AI adoption thoughtfully—starting with low-risk areas, ensuring ethical oversight, and educating themselves on the tools’ capabilities—lawyers can strike the right balance between innovation and caution. Embracing AI doesn’t mean replacing the human touch, but rather using it to work smarter, serve clients better, and stay competitive in a rapidly evolving profession. With the right mindset and plan, AI can be a powerful ally in delivering high-quality legal work.