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Generative AI and Legal: Its Not a Game Changer Until the Game Has Changed

Stephen Embry – “…I agree that any change in the current model for paying for legal services will likely be slow. I say this in part based on history: over and over, we have been told that something will upset the apple cart in legal. Over and over, it hasn’t, or at least only a little bit. Never underestimate the power of lawyers to resist change. And when you look at the payment method and how ingrained it is, you can see the reason for my pessimism. The law firm structure in the U.S. and elsewhere is built on the billable hour and leverage models. It is firmly entrenched. The model rules firm finance. Advancement and compensation within the firm by partners and associates are based in large part on the concept of billable hours and leverage. The highest compensated partners are those who not only have high billable rates. But who can also leverage their work and enable a slew of other people to bill to their files. Often, these highly compensated are the partners with the most clout and decision-making authority in the firm. As Richard Susskind so aptly put it: it’s hard to tell a room full of millionaire partners their business model is all wrong. Law firms and lawyers have profited handsomely from the model and aren’t likely to change unless they have to. Moving to a model based on doing more for less cost, like alternative fee arrangements (AFA), is a severe threat. Most AFAs don’t provide any sort of success/bonus component, so there is little upside for law firms…”

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