Freshfields is expanding its use of artificial intelligence technology, including an agreement with US start-up Anthropic to jointly develop legal AI tools.
The London-headquartered firm last week said that it will partner with Anthropic, which makes the Claude chatbot, to build legal tools that could in future be sold to other law firms. The AI tools will also be used by 5,700 Freshfields employees and the legal team at Anthropic.
The co-development of legal AI software will include legal and market research, reviewing and drafting of contracts and using ‘agentic’ AI for multi-step legal tasks, Freshfields said.
“Partnering with Anthropic strengthens our ability to co-innovate at pace and to bring new capabilities into our work in a way that is secure, compliant and focused on client needs,” said Gil Perez, chief innovation officer at Freshfields.
The terms of the deal were not revealed.
The Anthropic agreement is a sign of how important AI is becoming to the strategy and daily operations of large law firms. If other law firms also agree to similar partnerships with general-purpose AI suppliers, it could create a headache for specialist suppliers of legal software.
Earlier this year, legaltech company share prices plunged over fears that AI may upend rather than fuel their businesses, though analysts and suppliers insist this was a market overreaction. The sell-off was in response to a product update at the end of January by Anthropic.
Last week, shares in two of the biggest legal software suppliers − RELX, parent company of LexisNexis, and Thomson Reuters − fell on the day the Freshfields-Anthropic agreement was announced.
In a separate announcement, Freshfields said that more than 5,000 of its employees are using AI tools built with Google technology for tasks including due diligence, case management and reviewing contracts. The firm didn’t reveal how much it has spent on the Google technology.
As part of the project, Freshfields said it has rolled out Google Workspace – which includes Google Drive, Google Doc and Google Meet – to more than 2,800 users. Staff are using Google Workspace with Gemini for transcribing meetings and summarising documents.
However, measuring the payback from AI is proving tricky for Freshfields and other law firms.
Many firms are still experimenting with AI and, therefore using it on a relatively small scale. That can make it hard to calculate firm-wide benefits of legal AI technology. Meanwhile, the time and cost of checks by human lawyers on AI outputs must be subtracted from any benefits of AI, such as time savings or efficiency gains.
In an interview with GLP, Freshfields executives said that despite seeing significant benefits from the Google technology − including time saved reviewing and summarising documents – it was unable to estimate an overall return on investment.
“I think [calculating a law firm’s overall return on AI investment is] an industry challenge to all of us,” said Perez. “I don’t think anybody has the answer to it.”
Lukas Treichl, a Freshfields partner based in Vienna and Munich, who co-leads a team of legal professionals, software developers and project managers at the Freshfields Lab, said the firm is trying to automate its workflows across practice groups.
“Some of these automations don’t even require AI [but] lots of them benefit from AI,” he added.
In addition to Google, Freshfields also uses legal AI software from Microsoft, Thomson Reuters and Germany’s Beck-Noxtua. It has developed its own AI tool, which it uses for secure chat and document analysis.
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