What if the very tool you use to build your business lands you in a lawsuit?

As scary as this is, this is a problem that every law firm faces everyday with legal AI tools.

Can these tools help streamline certain tasks? Absolutely.

Do they make legal research and document generation easier? Of course.

But if not monitored properly, these tools can violate laws and cause a potential lawsuit for your law firm.

Let’s find out the potential ways that AI can cause your law firm to be sued and how to avoid it.

Unauthorized Practice of Law

Think about some of the legal automation tools:

• Lexis + AI
• Spellbook
• Clausematch
• DoNotPay
• LegalMation
• Casetext.

Let’s be honest. We know that people use these tools for legal advice. And that’s the problem.

Let’s say that someone discovers that a false protective order was filed against them. They type a question about possible solutions in your law firm’s chatbot and it replies, “You need to file a motion to dismiss. Here’s how.”

Congratulations. Your law firm is now facing a potential lawsuit.

AI tools can’t offer legal advice. The only professionals who can offer legal advice are attorneys.

If an AI tool only provides general information about a legal topic, that’s fine. But when it starts offering specific advice for specific legal situations, it can lead into the next potential lawsuit: negligence.

Negligence

Negligence is an offense where a person is harmed due to another person’s failure to provide reasonable care.

How can your law firm be accused of negligence due to AI?

Let’s say that someone is the victim of a car accident. They want to know the time limit they have to file a car accident claim.

When they ask the chatbot, it replies that the statute of limitations is three years.

But it’s actually two years in the state that the victim lives in.

Now that person missed their opportunity to file a claim against the other party. And instead of suing them, they’re suing you!

And to make matters worse, they may be in the right to do so. Because the information provided was inaccurate, and the AI was mistaken as an entity allowed to practice law, a judge may declare that the AI had a duty of care to the victim.

False Advertising

Another potential lawsuit just waiting to happen is false advertising.

This is the act of promoting a product or service in a deceptive manner. What does this look like with legal automation?

• Asserting that the AI tool is “better than a lawyer.”
• Implying that the information presented is 100% accurate.
• Promising a certain legal outcome.
• Insinuating that the AI tool is endorsed by a certain court.
• Implying that the AI tool is compliant in all 50 states.

Even at its best, legal AI tools can’t promise certain legal outcomes for clients, nor can they guarantee that the information provided is accurate.

These types of claims can mislead clients and allow them to use legal AI tools in deceptive ways.

A Hit to Your Reputation

All it takes is one of these types of lawsuits to cause serious damage to your reputation.

Who wants to do business with a law firm that’s notorious for breaking laws?

You don’t want to suffer a lawsuit because you placed all of your trust into a legal AI tool. While these tools are helpful with certain tasks, you don’t want your clients to mishandle them or use them inappropriately.

If you’re not careful with your AI tools, you can face:

• Potential malpractice lawsuits.
• Civil and criminal charges.
• Disciplinary action from the state bar.
• Expensive fines.
• Loss of trust from clients.
• A loss of business opportunities.
• Increased scrutiny from other legal entities.

There’s no need to suffer these consequences, especially when they can be avoided.

To avoid a potential AI-related lawsuit, here are some steps that law firms can take.

Writing Disclaimers

Disclaimers, disclaimers, disclaimers. Make sure to have a disclaimer with every legal AI tool you have.

A disclaimer is a legal statement that explicitly states what a service provider is or isn’t responsible for. When writing disclaimers for legal AI tools, make sure to explicitly state what the AI can and cannot do when it comes to legal information.

A simple disclaimer like, “The information provided is NOT legal advice. If you need legal advice, speak with an attorney.” should do.

The goal of your disclaimer is to communicate what the legal automation tool should not be used for and who to seek for legal advice.

Including a Terms of Use Agreement

Another legal protection you can take advantage of is a terms of use agreement. Similar to a disclaimer, this agreement lays out all of the necessary information that users need to know before using a service.

It can include information like:

• What the service is used for.
• Who can use the service.
• What you cannot do with the service.
• Intellectual property.
• Conditions where the user could be suspended or terminated.

You can create a term of use which states that the user should only use the AI to research general information on a legal subject. Additional warnings such as not using the tool for legal advice and not mistaking it for an attorney-client relationship should also be included.

Terms of use are another way to establish boundaries between the legal AI tool and your users while protecting your law firm.

Adjusting the Legal Tool’s Functionality

Another proactive step you can take is reducing the legal tool’s functionality.

It’s easier to prevent a future lawsuit if the tool’s features are prevented from performing certain tasks.

Some of the ways you can limit your legal tool’s features are:

• Restricting the tool from providing legal advice.
• Programming the tool to only provide general information on legal topics.
• Granting attorneys special access to certain legal procedures.
• Blocking questions that are outside of your law firm’s service areas.

These limitations can help restrict the AI tool from potentially providing misinformation or assuming the role of an attorney.

Taking Advantage of Human Review

Last but not least, you can take advantage of human insight.

As we can see, human attorneys are still necessary for legal matters. But that doesn’t mean that you have to choose between legal automation and human help.

You can have the best of both worlds by incorporating a hybrid model.

What does that look like?

• Assigning review checkpoints.
• Permitting legal staff to edit, reject, or verify AI-generated content.
• Incorporating audit logs that track who approved what.
• Designing role-based workflow automation.
• Requesting client consent for AI-assisted tasks.

With this hybrid model, tasks can still be streamlined ethically.

Final Thoughts

You’ve invested too much into your law firm for your credibility to be questioned.

Whatever AI tools you use for your law firm, you want them to work for you and not against you.

By making sure that your AI tools are equipped with disclaimers, terms of use, restricted functionality and human insight, you can help protect your law firm from future lawsuits.

Schedule a Consultation Today!

If you need a pair of human eyes to assist with managing your legal automation, let’s chat. Click here to book a consultation.

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