The Role of Compensation in Transitioning Founder-Owned Law Firms
In today’s fast-paced legal industry, keeping a law practice competitive requires strategic planning and a forward-thinking approach. One of the most impactful ways to ensure long-term success is by implementing a compensation plan that rewards key contributions and aligns with market conditions.
A well-designed compensation plan not only drives profitability
but also enhances a firm’s ability to navigate the transition
from one generation to the next.
Key Contributions to Reward
To keep a law practice competitive, it is essential to reward various contributions. Contributions may vary in weight from one firm to another. Still, a list of contributions includes:
– Profitability
– Workload distribution and management,
– Marketing
– Recruiting contributions,
– Originiation
– Attorney development and training
– Rates and realization management
– Client relationship management.
– Billing and collection discipline,
Importance of Measurable Results
Busy lawyers need key performance indicators (KPIs) to measure effectiveness and support systems to produce measurable results. Investing in long-term goals is challenging, especially when founders struggle between long-term success and maximizing short-term profits. Choosing long-term investing is especially difficult when the likely returns will come after a founder retires.
Client Control and Compensation
Another aspect of preparing a firm for a second generation relates to client control. While necessary, transferring client control can often result in reduced income and organizational power. Relinquishing client control is challenging when founders seek compensation for their years of work and personal sacrifice. Ensuring that any transition plan includes a compensation and back-end payout schedule is crucial.
Data-Driven Compensation Plans
A data-driven compensation plan that pays at competitive market levels can align the perceived and actual value of a lawyer’s economic contributions. The best indication of value is what a competent competitor will pay. Achieving this level of acceptance can remove a significant obstacle inherent in the practice transition process.
Key Elements of Market-Based Compensation System
A contributed profit analysis is the primary tool for compensating at the market level. The main elements of this system include:
Origination sharing policies
Profitability by originator with client, file, and timekeeper detail
A fair overhead allocation system
Empowerment over case staffing
Key metrics that include target payout ranges compared to contributions profit
A results stabilization method (two- or three-year rolling averages)
Conclusion
In conclusion, these systems require time and effort to build, but experienced professional help is available. The resulting impact on profitability, firm competitiveness, and market attractiveness can significantly improve a struggling firm and further the success of high-performing firms.
With a market-based compensation system, a transition compensation feature, and a process for the orderly transition of ownership interests, firms can significantly enhance their ability to pass from one generation to the next.
The Personal Side of M&A: Helping Business Owners Turn Vision into Legacy
For many business owners, their company is far more than a financial asset or something they list on a personal financial statement. It’s the product of their years of hard work, risk, and dedication. In many cases, it is even a family legacy. As an M&A lawyer, I have had the privilege of counseling many business owners through one of the most significant chapters in their lives: the sale of their business.
The Emotional Aspect of Selling a Business
Selling a business isn’t simply a transaction; it’s a transition from one phase of life to the next. For entrepreneurs, a company is more than just an income stream. It embodies their vision, the long days and late nights they worked to build it, and the sacrifices they made to keep it growing.
For me, as an M&A lawyer representing the seller’s side, guiding owners through this emotional journey is a more worthwhile experience than the sale itself. While the numbers and legal terms are critical, equally important are the personal goals and aspirations of my clients. For some, selling a business marks the beginning of retirement or a well-earned sabbatical. For others, it’s an opportunity to invest in a new venture and reignite their entrepreneurial spark. Understanding why they are selling and what’s next for them is as essential as negotiating the deal itself.
Aligning Personal Goals with Strategy
Each seller’s situation is unique. Some business owners want to maximize value to secure their family’s future, while others prioritize finding the right buyer to preserve the culture and legacy they’ve built. I view my role as more than just structuring a deal—it’s about helping clients achieve their personal definition of success.
For instance, when an entrepreneur tells me they want to ensure their employees are taken care of following the sale, I weave that commitment into the negotiation process along with the other material deal terms. When an owner envisions using the proceeds to pursue philanthropic endeavors, I help ensure that the practical financial outcome supports that goal.
Celebrating the Entrepreneurial Spirit
Entrepreneurs are remarkable individuals. They start with an idea, take risks others might avoid, and build a legacy that positively impacts their lives and the lives of their employees. I’ve always admired the entrepreneurial spirit and it’s incredibly rewarding to be part of their journey at such a transformative moment.
One of the most fulfilling aspects of my work is seeing business owners realize what they’ve built. In many ways, a successful sale is a celebration of their achievements. It’s an acknowledgment that their vision and effort created something enduring—a business that now has new opportunities for growth under new leadership.
Why the Right Counsel Matters
The sale process can be complex and overwhelming, especially when emotions run high. Having the right M&A counsel means having someone who not only understands the legal and financial nuances, but also appreciates the personal stakes. My approach is to bring clarity, confidence, and care to every step of the process. Sellers need someone who can advocate for their best interests while respecting the legacy they’re entrusting to the next owner.
Final Thoughts
The sale of a business is more than a transaction; it’s the culmination of a dream. Representing sellers has given me a front-row seat to some truly inspiring entrepreneurial stories, and I feel privileged to help business owners achieve their goals—both professional and personal. Whether it’s unlocking new opportunities, securing a family’s future, or ensuring the continued success of a legacy, my mission is to make the process as smooth, successful, and meaningful as possible.
Why Your Relationship with Your Estate Planning Attorney is Important
When people think about estate planning, they are usually focused on the documents they need, such as wills, trusts, powers of attorney, and healthcare directives. While most of these are essential, they are only part of the entire “estate planning equation.”
At the heart of a successful estate plan lies something arguably more crucial—your relationship with your estate planning attorney. This partnership is one of the most important relationships you can have during your lifetime.
Choosing the Right Attorney for You
When selecting an estate planning attorney, look for someone who embodies these attributes:
A deep understanding of your unique circumstances and goals.
The ability to clearly explain complex legal concepts in an approachable way.
A commitment to building a long-term partnership that evolves with your needs.
Expertise in anticipating and addressing potential challenges.
A trustworthy, communicative, and empathetic approach.
Understanding You and Your Family
No two people – or families– are the same. Your family dynamics, financial situation, fears about the future, and personal values shape your estate plan. When you trust and have a strong relationship with your attorney, you feel comfortable explaining potential difficulties and the unique needs of your surviving loved ones. Your attorney should ensure they understand these nuances and tailor your plan accordingly. Whether it’s addressing sensitive family matters, safeguarding assets, or leaving a legacy, your attorney’s role is to listen and understand without judgment. Your attorney needs to be able to ask the right questions to get to the heart of the matter, so they can better guide you toward achieving your goals. Too often, attorneys forget to address specific issues or ask the right questions.
A Lifelong Partnership
Estate planning is not a one-and-done process. As your life evolves, your attorney should be one of the first to know what this new era entails for your individualized and broader life plans. Whether you just got married (or divorced), children or grandchildren were born, your business(es) grew (or didn’t), or a loved one passed away, your attorney will help you to celebrate and prepare for new beginnings or get you through some of the hardest times in your life. Your attorney becomes a trusted partner and confidant who can help you navigate as circumstances shift.
A successful attorney-client relationship is built on trust. Open and frequent communication ensures that you feel comfortable discussing personal details and asking questions. Knowing that your attorney has your best interests at heart provides peace of mind—not just for you, but for your family as well.
Clarity in Complexity
Estate planning can feel overwhelming, with legal jargon and complex concepts often clouding the process. Having an attorney who can simplify the details and present them in clear, straightforward terms is invaluable. This approach not only ensures that you fully understand your options but also empowers you to make the best-informed decisions for yourself and your family. Having an estate planning attorney who cares, gets to know you, makes sure you understand your options, and fully explains possible outcomes is vital to establishing a plan that can accomplish your goals and needs.
Guiding Your Loved Ones in Difficult Times
Losing a loved one is one of the most difficult experiences in a person’s life. Your estate planning attorney should take the burden off your survivors during these challenging times, helping them navigate complex legal processes with care, giving them time to grieve and focus on what matters most. Having an attorney who knows your intentions and knows about your family dynamics can help prevent disputes when emotions are high.
Your estate plan is too important to leave to chance. By prioritizing these qualities, you can ensure that your attorney is not just a service provider, but a lifelong trusted advisor who will help you make the best decisions for your peace of mind and your family’s future.
TMA Chicago/Midwest Podcast Hosted by Paul Musser | Jonathan Weinberg on Private Credit and the Importance of Early Intervention in Workouts [Podcast]
In the latest TMA Chicago/Midwest podcast episode, host and Insolvency and Restructuring Partner Paul Musser sat down with Jonathan Weinberg, Co-Head of the Portfolio Group at Monroe Capital LLC. Together, they discussed Jonathan’s career path in restructuring, comparisons and contrasts between private credit and traditional bank lending horizons, and the importance of early intervention in workouts. Jonathan also noted highlights from his involvement in the Turnaround Management Association (TMA) as well as the benefits of building one’s network and fostering relationships within the restructuring community.
Jonathan explained that his career began in investment banking, where he developed a keen interest in capital structures during the subprime mortgage boom. This experience led to his transition into restructuring and distressed investment banking, where he found fulfillment in using his deep understanding of capital markets to solve complex financial issues. Jonathan said that in his role at Monroe Capital, early intervention and proactive management have been instrumental in leading strategies for stressed credits.
Paul and Jonathan went on to discuss comparisons and contrasts between private credit and traditional bank lending, particularly in terms of flexibility and decision-making. Jonathan explained that private credit lenders such as his firm have more leeway in managing stressed and distressed situations due to fewer regulatory constraints, as compared to traditional banks. This flexibility allows them to engage in creative solutions, including taking equity positions or working closely with sponsors to navigate financial challenges. In any workout, both Jonathan and Paul emphasized the value of maintaining strong borrower relationships in order to foster collaborative problem-solving.
Finally, Jonathan shared takeaways from his experiences as a member of the TMA organization and how it fostered his own professional growth and business development. He underscored the value of building relationships with industry peers across different functions, such as legal, financial advisory and lending. He encourages professionals at the beginning of their restructuring careers to proactively foster their skills and networks, as such connections can be crucial when seeking guidance on complex distressed or financial situations.
Why We Love Data Quality
Love is in the air this February—but at CLIENTSFirst Consulting, we have a different kind of passion: a love for data quality. While it may not be the most glamorous topic, high-quality data is the unsung hero of every successful CRM, ensuring law firms can make informed decisions, optimize business development, and enhance client relationships.
Yet, as our 2024 CRM Success Survey reveals, law firms are struggling with data quality, and it’s costing them. Let’s explore why data quality matters, what happens when it’s ignored, and how to build a CRM that firms (and their attorneys) can truly love.
Data Quality: The Foundation of CRM Success
The CLIENTSFirst 2024 CRM Success Survey found that 84.71% of law firms have a CRM in place, yet their average satisfaction score is just 5 out of 10. Even more concerning, firms rated their data quality at an abysmal 6 out of 10. If a CRM is only as good as the data inside it, then poor data quality could be the real culprit behind CRM dissatisfaction.
This is a widespread challenge—not just for law firms but across industries. Respected research organizations found that 30% of contact data degrades every year, and that rate is likely even higher in the wake of rapid workforce changes. Without proactive data maintenance, CRM systems become bloated with outdated, incomplete, and duplicate records, making them more of a liability than an asset.
The Hidden Cost of Bad Data
Poor data quality doesn’t just create frustration—it has tangible business consequences. The damage is often hidden, accumulating over time like dust in a neglected attic. At first, it’s just a few outdated contacts, a couple of bounced emails. But as time goes on, the effects snowball, creating inefficiencies, lost opportunities, and wasted resources.
1. Wasted Marketing Efforts
Imagine launching an expensive client event, only to find that half of your email invitations bounce or go to outdated addresses. Your firm has spent weeks planning, securing speakers, and finalizing logistics, but the right people never even receive the invite. Worse, if your marketing database is riddled with duplicates and old contacts, your communications may not be reaching the key decision-makers—leading to missed engagement and low ROI.
2. Attorney Resistance and CRM Fatigue
Lawyers rely on data to build and maintain client relationships, but when the CRM becomes a source of frustration instead of insight, they stop using it. Our survey found that only 29% of attorneys use the CRM consistently, a clear sign that trust in the system is lacking. Why? Because when they search for a client, they often find duplicate records, outdated information, or missing contact details. If they can’t trust the system, they won’t use it—and if they won’t use it, the CRM fails to fulfill its purpose.
3. Lost Revenue and Business Development Opportunities
Consider this: A partner at your firm is preparing for a high-stakes pitch to a potential client. They need to see past interactions, notes from previous meetings, and recent engagements. But when they open the CRM, the data is incomplete, inaccurate, or missing entirely. The meeting goes forward, but without the right context, the conversation lacks the personal touch needed to seal the deal.
In contrast, firms with high-quality data can analyze their contacts, track engagement history, and proactively spot new business opportunities. Clean data isn’t just about hygiene—it’s a revenue-driving strategy.
4. The Cost of Cleanup vs Presentation
The financial burden of reactively fixing bad data is enormous. Studies show that fixing bad data costs 10 times more than preventing it in the first place. Yet many firms still treat data quality as an afterthought, only realizing the scale of the problem when marketing ROI declines, clients stop responding, or attorneys complain that the CRM is unusable.
The reality is that poor data quality is a silent revenue leak—and the firms that get ahead of it will be the ones that thrive.
How to Make Your CRM a Data Quality Success Story
So how do you stop bad data from sabotaging your CRM? At CLIENTSFirst Consulting, we believe that data quality success doesn’t happen by accident—it requires a strategy. Here’s how to transform your CRM from a frustration point into a business powerhouse:
1. Start with a Data Quality Assessment
Would you buy a house without an inspection? Of course not. The same logic applies to your CRM. The first step to fixing data issues is understanding their full scope. We recommend a Data Quality Assessment to analyze your records, identify gaps, and prioritize what needs cleaning. It’s not about tackling every issue at once—it’s about fixing the most critical problems first.
2. Leverage Data Stewards for Continuous Quality
A one-time cleanup is not enough—data degrades constantly. Without ongoing maintenance, bad data creeps back in. A dedicated Data Stewarding team ensures that every record added is verified, updated, and correctly formatted. The firms that invest in long-term data quality management see the biggest improvements in CRM effectiveness.
3. Standardize Data Entry and Governance
One of the biggest drivers of bad data is inconsistency in how records are entered. If one person logs a contact as “J.P. Morgan Chase” and another as “JP Morgan,” searches won’t return complete results. Establishing clear data entry rules and enforcing consistent formatting can eliminate errors before they happen.
4. Align Data Strategy with Attorney Buy-In
Attorneys need to see what’s in it for them—how clean data makes their work easier. Training, dashboards, and easy-to-use interfaces are crucial. Firms that provide role-specific CRM training—showing attorneys how the data helps them win business and strengthen relationships—see higher adoption and greater CRM success.
Why We’re Passionate About Data Quality
A law firm’s CRM is more than just a database—it’s the foundation of client relationships, marketing outreach, and business development. But when data quality is poor, the CRM becomes a liability instead of an asset.
Investing in True Data Quality Success (TrueDQ™) isn’t just a best practice—it’s a competitive advantage. Firms with clean, well-structured data:
✅ Engage clients more effectively✅ Spot new business opportunities faster✅ Enhance marketing performance✅ Ensure attorneys have the insights they need, when they need them
This Valentine’s Day, we invite you to fall in love with data quality—because a CRM that works is a CRM worth loving.
The Path & The Practice Podcast Episode 123: William McKenna, Partner [Podcast]
This episode of The Path & The Practice features a conversation with William McKenna. Bill is a litigation partner in Foley’s Chicago office. In this discussion, he looks back on growing-up in Hinsdale, Illinois, attending Middlebury College for undergrad and earning his J.D. from the University of Chicago Law School. Bill also reflects on over 40 years of practice, including Foley’s merger with Hopkins & Sutter in the early 2000s. He discusses the importance of, as a litigator, being open to new opportunities and learning how to read and ride the waves of litigation. Finally, Bill gives fantastic advice on the importance of big law associates always thinking ahead.
William’s Profile:
Title: Partner
Foley Office: Chicago
Practice Area: Litigation
Hometown: Hinsdale, IL
College: Middlebury College
Law School: University of Chicago Law School
Law Firm Marketing Secrets: How to Get the Best ROI on Advertising
For small to mid-sized law firm owners, effective marketing is essential for growth. However, to ensure success, you must track key performance indicators (KPIs) that measure the impact of your efforts. This article explores the fundamental metrics that drive marketing success and how to structure your marketing team for optimal performance.
Key Marketing KPIs for Law Firms
1. Cost Per Acquisition (CPA) / Cost Per Signed Client
This is one of the most critical KPIs for law firms because it directly impacts profitability. CPA measures how much you are spending to acquire each new client. Since signed cases generate revenue, understanding CPA ensures that your marketing spend aligns with business objectives.
A lower CPA means your firm is acquiring clients efficiently, while a high CPA may indicate inefficiencies in your marketing strategy or intake process. To optimize CPA, law firms should:
Refine Targeting – Ensure your advertising is reaching the right audience by leveraging demographic, geographic, and behavioral targeting strategies.
Improve Intake Processes – A strong lead conversion system ensures that potential clients are not lost due to delays or poor follow-up.
Optimize Ad Performance – Continuously test different ad creatives, copy, and landing pages to improve conversion rates.
Leverage Retargeting Strategies – Many prospective clients don’t convert immediately. Retargeting campaigns can help bring them back when they’re ready to take action.
Measure and Adjust Regularly – Review CPA metrics frequently to identify trends and make data-driven adjustments to campaigns.
Tracking CPA alongside client lifetime value (CLV) is also crucial. If a firm has a high CPA but the lifetime value of a client is significantly higher, it may still be a worthwhile investment. However, if CPA approaches or exceeds the revenue a case generates, marketing efforts need reassessment.
2. Return on Advertising Spend (ROAS)
ROAS measures the revenue generated for every dollar spent on advertising. The goal is to show that $1 invested in marketing returns $5 or even $10. A strong ROAS ensures sustainable growth and helps justify scaling marketing efforts.
A high ROAS indicates that your marketing campaigns are not only reaching the right audience but also converting potential clients into actual cases. To improve ROAS, law firms should focus on optimizing ad targeting, refining their messaging, and continuously testing different platforms and ad creatives.
Additionally, tracking ROAS across various marketing channels, such as digital ads, television commercials, and social media, can provide insights into which platforms deliver the highest return. If one platform significantly outperforms others, it may be worth reallocating more of the budget to that channel.
It is also important to measure ROAS over different timeframes. Personal injury cases, for example, may take longer to close, so evaluating ROAS only on a short-term basis might not fully capture its effectiveness. Instead, law firms should assess both short-term and long-term ROAS to get a complete picture of their marketing investment’s impact.
Lastly, ROAS should be analyzed alongside other key metrics like CPA and client lifetime value (CLV). If a law firm has a high ROAS but a low client retention rate, it may indicate the need for better follow-up and client experience strategies.
Why Law Firm Marketing Is Essential for Business Growth
Some law firms have powerful stories but lack media amplification, meaning not enough people hear about them. Others spend heavily on advertising but lack a compelling story to engage their audience. Striking the right balance is crucial.
Marketing is not just about spending money on ads—it’s about strategically positioning your firm to stand out in a crowded marketplace. A strong marketing strategy can:
Increase Brand Awareness – Ensuring that your law firm is top-of-mind when potential clients need legal assistance.
Build Trust and Credibility – Showcasing testimonials, case studies, and client success stories to establish your firm as a reliable advocate.
Differentiate Your Firm from Competitors – Highlighting your unique approach, specialized expertise, or exceptional client service.
Generate a Steady Stream of Leads – A well-executed marketing plan ensures a consistent pipeline of potential clients, reducing dependency on word-of-mouth referrals alone.
Amplifying your story through local and national TV ads can be a game-changer. TV advertising offers large-scale reach and credibility, as consumers tend to trust brands they see on television. However, for TV ads to be effective, they must be:
Educational – Providing valuable information to potential clients that positions your firm as knowledgeable and helpful.
Emotional – Connecting with viewers on a deeper level by addressing their pain points, concerns, and needs.
Persuasive – Encouraging action, whether it’s calling for a consultation or visiting your website for more information.
A well-crafted campaign not only increases visibility but also positions your firm as a trusted leader in your practice area. Moreover, integrating TV advertising with digital strategies, such as social media, Law Firm SEO, Law Firm PPC, and content marketing, creates a well-rounded marketing approach that maximizes reach and impact.
Allocating Your Marketing Budget
Law firm marketing budgets should range between 5% and 30% of revenue, depending on risk tolerance and growth ambitions. Your budget must cover:
Headcount – Salaries for your marketing team.
Media Spend – Paid advertising across digital, TV, and other channels.
Asset Production – Creating high-quality content and ads.
Maintaining a balance is crucial. If you have a talented team but an insufficient media budget, your message won’t reach enough people. Conversely, a large media budget with weak creative assets will result in ineffective campaigns.
The Role of an In-House Legal Marketing Team
A well-structured in-house marketing team can align business objectives with marketing media strategies. Marketing should translate business goals into measurable marketing metrics, ensuring effective execution.
Core Components of a Marketing Team:
Creative Department – Designers, photographers, copywriters, storytellers, and editors who craft compelling, client-focused assets.
Media Department – Media planners who strategize ad placements and media buyers who negotiate and purchase advertising space at the best possible rates.
In-House Team vs. Agency: Pros and Cons
Benefits of an In-House Team:
Long-term commitment and brand understanding.
Team cohesion and consistency in messaging.
Deep knowledge of the firm’s value proposition.
Benefits of Using an Agency:
Greater flexibility in scaling campaigns.
Lower upfront costs compared to hiring a full-time team.
Negotiable contract terms and specialized expertise.
The Power of Empathy in Legal Marketing
Remember, personal injury law firms attract clients experiencing some of the most difficult times in their lives. Whether they or a loved one have been injured or lost their life due to negligence, your message must convey empathy and a commitment to achieving the best possible outcome for them.
By combining strategic marketing, data-driven decision-making, and compelling storytelling, your firm can increase visibility, attract more clients, and achieve long-term growth.
February 2025 Legal News: Law Firm News and Mergers, Industry Awards and Recognition, DEI and Women in Law
Thank you for reading the National Law Review’s legal news roundup, highlighting the latest law firm news! As the country settles into the new year, law firm news has no signs of slowing down. Please read below for the latest in law firm news and industry expansion, legal industry awards and recognition, and DEI and women in the legal field.
Law Firm News and Mergers
Varnum LLP announced that Sarah Weston joined the firm’s Banking and Finance Practice Team as a partner in the Birmingham office.
“We are excited to welcome Sarah to the firm,” said Jon Bylsma, Chair of Varnum. “Her addition to our growing Birmingham office further strengthens our Banking and Finance Team, particularly with deep experience representing borrowers in complex commercial real estate and other financings. Sarah’s expertise will be a tremendous asset to our clients.”
Ms. Weston focuses her practice on counseling property managers, developers, senior housing owners and others through real estate finance transactions. This includes acquisitions, dispositions, construction and real estate mortgage loans and development agreements. Ms. Westons has been recognized as a Rising Star in Securities and Finance by Michigan Super Lawyers.
Rachael G. Pontikes, Emily L. Hussey and Shannon E. McClure joined Blank Rome LLP as partners in the Business Litigation group and Life Sciences industry team. Ms. McClure joined the firm’s Philadelphia office while Ms. Pontikes and Ms. Hussey joined the Chicago office.
Ms. McClure handles disputes in the life sciences and healthcare industries including health systems, distributors, pharmaceutical and medical device manufacturers. In addition, she serves as strategic national counsel for large matters in the coordination of company resolution strategies.
Ms. Pontikes and Ms. Hussey counsel clients on critical issues in the life sciences and healthcare industries, including due diligence in healthcare transactions, regulatory compliance, licensing matters, industry advocacy and administrative actions.
“We are thrilled to welcome Rachael, Emily, and Shannon to Blank Rome,” said Grant S. Palmer, Blank Rome’s Chair and Managing Partner. “They are exceptional attorneys whose multi-faceted practices align with the needs of our clients and will enable us to provide outstanding client service to those operating in the healthcare and life sciences industries and beyond.”
Gunderson Dettmer Stough Villeneuve Franklin & Hachigian, LLP announced the addition of three new corporate partners in Atlanta as well as the official opening of its 12th global office.
John Yates, a pioneer in technology law, has been involved in helping hundreds of tech companies in raising and closing financing. In addition, he launched Morris, Manning & Martin’s technology practice over 35 years ago.
Joe Berklund focuses his practice on representing companies and funds in M&A transactions as well as financing; he was previously co-chair of MMM’s emerging companies/venture capital practice and the firm’s Florida practice leader.
Zach Crowe represents technology startups, private equity and venture capital firms in strategic investments, general corporate matters, financing transactions, and mergers and acquisitions.
“After more than a decade in the region, this expansion marks a significant milestone in our growth strategy. We are doubling down on the region’s thriving venture capital and emerging companies ecosystem,” says Jeff Higgins, Gunderson Dettmer’s managing partner. “The addition of corporate partners John Yates, Joe Berklund, and Zach Crowe will provide clients with the best-in-class corporate and securities support they expect from us.”
Legal Industry Awards and Recognition
Ward and Smith, P.A., as well as four of its attorneys, was recognized in the 2025 edition of World Trademark Review 1000 for excellence in intellectual property law. The firm received a Silver Band ranking for providing “pragmatic and easy-to-understand advice” and for being “commercially astute and laser-focused on helping clients make the most of their intellectual property.”
Angela Doughty, Erica Rogers and Joe Schouten received Silver Band rankings while Art DeBaugh received a Gold Band ranking.
Anne Lapierre and Simon Cudennec from Bracewell LLP were ranked in the inaugural edition of Chambers France.
Ms. Lapierre, managing partner of the firm’s Paris office, was ranked in the Projects & Energy: Domestic-France category. She focuses her practice on being a voice in renewable energy procurement as well as ground-breaking energy projects.
Mr. Cudennec, ranked in Projects & Energy: International, focuses his practice on natural resources, energy and infrastructure. With over 15 years of experience, he has a deep understanding of the unique challenges and legal intricacies in French-speaking African project development..
Sidley Austin LLP was recognized by The M&A Advisor at the 19th Annual Turnaround Awards for two deals. The awards honor “trailblazers in the fields of distressed investing and restructuring.”
The restructuring of Rite Aid Corporation was named the winning matter in the “Healthcare/Life Sciences Deal of the Year (Over $1B)” category. The Sidley team represented the corporation’s largest pharmaceutical product supplier, McKesson Corp., in Rite Aid’s bankruptcy, negotiating a deal to reduce McKesson’s credit exposure.
A team from the firm also represented ICON Aircraft, Inc. in the sale of its assets to an affiliate of Dürkopp Adler GmbH. The team successfully secured approval of the sale of ICON Aircraft to SG Investment America from the U.S. Bankruptcy Court for the District of Delaware. They were recognized in the “Industrials Deal of the Year (Under $1B)” category.
DEI and Women in Law
Tiffany Presley, Bryan Castro and Charity Seaborn, attorneys from Barnes & Thornburg LLP, were selected for innovative professional development programs with the Leadership Council on Legal Diversity. The programs are designed to cultivate influential leaders and propel attorneys toward the next stage of their careers.
Ms. Presley will participate in a year-long program focused on relationship building and leadership as a member of the 2025 class of Fellows. She will connect with the leading council for career guidance and mentoring. Mr. Castro and Ms. Seaborn will participate in the Pathfinder program to learn from top leaders and experts in executive coaching.
“As a firm, we are committed to fostering an environment where all of our teammates can thrive and lead,” said Dawn R. Rosemond, partner and firm diversity partner at Barnes & Thornburg. “Tiffany, Bryan and Charity’s selection for these prestigious LCLD programs is a testament to their talent and dedication. We are proud to support their continued growth as they build relationships and develop skills that will shape the future of the legal profession.”
Chuhak & Tecson, P.C. announced that Christine A. Barone, principal in the Estate Planning & Asset Protection and Estate & Trust Administration & Litigation practice groups, was honored by Law Bulletin Media as one of the “40 Under 40 Illinois Attorneys to Watch.”
“Christine has been a wonderful addition to our Elder Law Practice and our Private Wealth Services Team,” said Lindsey Paige Markus, principal and leader of the Estate and Trusts practices. “ Her professional designation as a CELA underscores her knowledge in this unique area of practice. And her innate ability to make clients feel comforted and at ease allows Christine to seamlessly guide families through guardianship, probate, trust administration and elder care planning. We are thrilled that Christine has been recognized for her extraordinary contributions and feel privileged we have the opportunity to collaborate with her every day.”
Ms. Barone is a Certified Elder Law Attorney by the National Elder Law Foundation. She is one of only 13 attorneys in the state of Illinois to have this honor.Her practice is focused on wills, trusts, estate planning and powers of attorney.
Shumaker, Loop & Kendrick, LLP announced that three of its attorneys have been selected for Leadership Council on Legal Diversity (LCLD) 2025 programs. Partner Christina Nethero was selected as a Fellow of the Fellows Program while Associate Michelina Carbone and Staff Attorney Lauren Diaz were named to the Pathfinders Program.
“Shumaker is deeply committed to advancing a culture of excellence and diversity, and our attorneys’ selection for these prestigious programs reflects not only this commitment, but our dedication to fostering leadership and innovation within the legal community as well.,” said Kate Decker, Partner Chair of Shumaker’s Council on Diversity and Inclusion.
Legal AI Unfiltered: 16 Tech Leaders on AI Replacing Lawyers, the Billable Hour, and Hallucinations
With AI-powered tools promising efficiency gains and cost savings, AI is fundamentally changing the practice of law. But as AI adoption accelerates, major questions arise: Will AI replace lawyers? What does AI adoption mean for the billable hour? And can hallucinations ever be fully eliminated?
To explore these issues, we surveyed 16 tech leaders who are at the forefront of AI-driven transformation. They provided unfiltered insights on the biggest AI adoption challenges, AI’s effect on billing models, the potential for AI to replace lawyers, and the persistent problem of hallucinations in legal AI tools. Here’s what they had to say:
Why Are Law Firms Hesitant to Adopt AI Tools?
According to our survey of tech leaders, law firms’ hesitation in adopting AI is driven by several key factors, primarily concerns about accuracy, risk, and economic incentives. Many firms worry that AI tools can generate incorrect or misleading information while presenting it with unjustified confidence, making mistakes hard to detect. Additionally, larger firms that rely on the billable hour see efficiency-driven AI as a potential threat to their revenue models. Other firms lack a clear AI strategy, making AI adoption and integration difficult. Trust, data privacy, and liability remain major concerns.
More specifically, here’s what tech leaders had to say about law firm hesitancy in adopting AI:
Scott Stevenson, CEO, Spellbook:
Daniel Lewis, CEO, LegalOn Technologies: “Law firms are hesitant to adopt AI over risk and liability concerns — accuracy and client confidentiality matter most. They need professional-grade AI that is accurate and secure. Solve that, and firms will break through business and organizational barriers—unlocking immense value for themselves and their clients.”
Kara Peterson, Co-Founder, descrybe.ai: “Because you can’t really count on it to be right—at least not yet. And unlike humans, when AI is unsure, it doesn’t admit it. In fact, it speaks with great authority and persuasiveness even when it is completely wrong. This means human lawyers must double-check everything because the errors are hard to spot. For many firms, this is simply too big a barrier to overcome. They are waiting for more reliable and error-free tools before jumping in.”
Katon Luaces, President & CTO, PointOne: “The main reason law firms are hesitant to adopt AI is reliability.”
Ted Theodoropoulos, CEO, Infodash: “A primary reason law firms hesitate to adopt AI is the absence of a comprehensive strategy. According to Thomson Reuters’ 2024 Generative AI in Professional Services survey, only 10% of law firms have a generative AI policy. Policies typically stem from well-defined strategies; without a clear strategy, formulating effective policies becomes challenging. Consequently, it’s likely that fewer than 10% of firms possess an AI strategy. Often, firms appoint C-suite or director-level AI/innovation roles without a pre-established strategy, expecting these individuals to develop one. However, strategic planning is most effective when initiated from the top down, and lacking this foundation can lead to unsuccessful AI integration.”
Dorna Moini, CEO/Founder, Gavel: “Law firms are mainly cautious because they need to ensure that any new technology meets their high standards for accuracy and confidentiality. They have built a reputation on careful, detailed work and worry that premature adoption might compromise quality. However, as AI improves and its track record strengthens, it can support lawyers in routine tasks without sacrificing the meticulous approach that defines legal practice.”
Troy Doucet, Founder, AI.Law: “Fear. Perfect is currently the enemy of the good, and as that subsides, lawyers will use it more.”
Colin Levy, Director of Legal, Malbek: “The risk of hallucinating, where a tool produces inaccurate or misleading information, is a key reason. Secondarily to this the lack of transparency around AI tools and the data they use/rely on is another cause of concern and hesitancy for many law firms.”
Gil Banyas. Co-Founder & COO, Chamelio: “The #1 reason law firms are hesitant to adopt AI is the lack of urgency due to their billable hour business model. Since firms generate revenue based on time spent, there’s no immediate financial incentive to implement efficiency-boosting AI tools that could reduce billable hours.”
Arunim Samat, CEO, TrueLaw: “Impact to the billable hour.”
Greg Siskind, Co-founder, Visalaw.ai: “Concerns regarding answer quality.”
Charein Faraj, Legal Operations Manager, LexCheck Inc.: “The answer depends on a law firm’s familiarity with AI and its awareness of the current legal AI market. Attorneys with little to no understanding of AI tend to be hesitant, often due to concerns about security, accuracy, and reliability. Those with some knowledge of AI and legal technology are more skeptical about its practical applications and return on investment, particularly given that many legal AI solutions require lengthy, complex implementations and significant change management.”
Mitchell Kossoris, Co-Founder and CEO, Deposely: “Data privacy and hallucinations are the most common concerns we hear from law firms. Lawyers want to ensure the data they provide will not go towards training any models, and they want to know that the outputs of models are reliable and grounded in truth.”
Chris Williams, Head of Strategic Partnerships & Community, Leya: “Law firms need to be sure that any AI tool they adopt will not compromise the precision or confidentiality required in legal work.”
Jenna Earnshaw, Co-founder & COO, Wisedocs: “Trust. Lawyers need to have complete confidence in their tools, and AI can sometimes feel like a ‘black box’—making decisions without clear explanations. If they don’t fully understand how AI reaches conclusions, it’s hard to trust it with high-stakes legal work. But here’s the thing—AI has been used in law for over a decade. Tools like Technology-Assisted Review (TAR) have proven to be as reliable as human review when used correctly. The hesitation isn’t really about whether AI can be trustworthy; it’s about transparency and control. The good news? With the right safeguards, oversight, and clear explanations of AI-driven decisions, law firms can use AI confidently. It’s not about replacing legal judgment—it’s about supporting it with smarter, faster tools.”
Where Does AI Excel, and Where Is It Still Overhyped?
Legal AI tools have made significant strides in the past two years, particularly in automating routine tasks that involve large volumes of data and well-defined processes. However, AI still struggles with more nuanced legal work that requires contextual understanding and strategic reasoning. Most legal tech leaders identified clear areas where AI is proving effective, alongside areas where expectations may still outpace reality.
Currently, AI excels in contract review, where it can analyze and summarize contracts with high accuracy. It is also highly effective in document review and due diligence, flagging inconsistencies, and surfacing relevant documents. Additionally, AI has reliably streamlined e-discovery, significantly reducing the time spent reviewing electronic documents. Another strength is its ability to summarize and extract data from documents.
However, AI remains less reliable in legal brief writing, as it struggles with complex legal arguments and strategic reasoning. Similarly, while it can return results for case law research, it often fails to grasp legal context, hierarchy, and nuances—though some legal tech leaders hold differing views on its efficacy in this area.
Legal tech leaders shared their insights into this “jagged frontier” of AI’s capabilities:
Scott Stevenson, CEO, Spellbook: “Excelling: Contract review and drafting; Hype: Litigation brief writing.”
Daniel Lewis, CEO, LegalOn Technologies: “There is a ‘jagged frontier’ between what AI handles well and where it can improve. It excels at repetitive and time-consuming tasks with clear guardrails, like contract review, drafting, and some types of Q&A, while less structured tasks like legal research carry a higher risk of hallucination. Contract review stands out for its defined standards, verifiable outputs, and clear objectives.”
Kara Peterson, Co-Founder, descrybe.ai: “AI is incredible at generating and interpreting text. However, it is not yet good at producing error-free, multistep legal workflows—though it is getting close. I wouldn’t call agentic AI in law “hype,” but it is still some distance away from being fully reliable.”
Katon Luaces, President & CTO, PointOne: “The great majority of legal tasks have yet to be mastered by AI. However, there are many tasks frequently done by lawyers that AI is genuinely excelling at. For example, AI is excellent at administrative work such as filling in billing codes and writing time entry descriptions—tasks that aren’t legal tasks historically done by lawyers.”
Ted Theodoropoulos, CEO, Infodash: “AI is excellent at acting as a sounding board during ideation and bringing additional perspective to the creative process. That said, it’s not good at generating novel ideas as it is limited to the confines of its training data. AI is good at summarization, extraction, and classification but still has a lot of room for improvement. For higher risk tasks it shouldn’t be relied upon solely. Currently, AI is not good at understanding context and nuance. As the infamous Stanford paper on legal research tools pointed out last year, these tools misunderstand holdings, struggle to distinguish between legal actors, and fail to grasp the order of authority.”
Dorna Moini, CEO/Founder, Gavel: “Today, AI is particularly effective at tasks like document review, legal research, and contract analysis. It can process large volumes of information quickly and flag important details for further review. On the other hand, AI is still far from being able to handle complex legal strategy or provide the nuanced judgment that experienced lawyers offer.”
Colin Levy, Director of Legal, Malbek: “AI is still not great at handling complexity or ambiguity, but some tools are getting better. Currently existing tools, however, are really good at conducting basic legal research and document review and analysis. AI tools are best at specific and well-defined tasks.”
Gil Banyas. Co-Founder & COO, Chamelio: “Genuinely Excelling: Document review & due diligence (finding relevant clauses, inconsistencies across contracts), legal research (case law/statute search, surfacing relevant precedents), and contract analysis (template comparison, risk flagging). Current hype: Legal writing from scratch, strategy/counseling, negotiation, and settlement work.”
Arunim Samat, CEO, TrueLaw: “AI excels in document review for eDiscovery; however, prompt engineering complicates the measurement of CAL review metrics. Caselaw research remains little more than an advanced search function in a database, as AI models are not yet capable of formulating case strategies while accurately citing relevant case law. Teaching LLMs to shepardize effectively remains a complex challenge.”
Greg Siskind, Co-founder, Visalaw.ai: “Practice management advice, legal research (via curated libraries), summarization, legal drafting and analysis.”
Charein Faraj, Legal Operations Manager, LexCheck Inc.: “E-discovery (and other procedural solutions) are likely the most advanced so far, as they are easier to develop and face fewer challenges related to issues like hallucinations and transparency. Meanwhile, some tools in more substantive areas, such as legal research, are marketed with great enthusiasm but may not fully meet expectations just yet. However, that doesn’t mean they won’t get there—it may simply take more time for them to be perfected.”
Mitchell Kossoris, Co-Founder and CEO, Deposely: “AI is excelling at tasks where it has access to a wealth of “grounding” data. Given the valid concerns around hallucinations, the most effective work an AI can do relies less on what the AI model intrinsically “knows” and more on analyzing data provided by the user or external sources (such as case law). For example, AI excels at document review because it’s processing and transforming existing data and at much faster rates than humans can.”
Troy Doucet, Founder, AI.Law: “The hype/reality issue is more from the companies that say they do AI but don’t really have an offering. We find AI can do just about anything if you know how to work with it.”
Chris Williams, Head of Strategic Partnerships & Community, Leya: “Automating repetitive tasks such as document review, data extraction, and research. AI’s ability to aggregate information from multiple sources demonstrates that AI is already effective in these areas. AI still struggles with tasks that require nuanced judgment and strategic thinking.”
Jenna Earnshaw, Co-founder & COO, Wisedocs: “AI is making a real impact in legal work, especially when it comes to handling large volumes of documents. One area where it truly shines is summarizing lengthy legal materials—think trial packages, depositions, and case files. Plus, AI helps minimize human error by ensuring critical information isn’t overlooked—especially in claims and litigation.”
Will “Hallucinations” in Legal AI Tools Ever Be Eliminated?
AI hallucinations—when a model generates incorrect or fabricated information—remain one of the biggest concerns for lawyers when using AI-powered legal tools. While advancements in AI continue to mitigate these issues, experts largely agree that hallucinations will likely persist to some degree due to the probabilistic nature of LLMs.
Nonetheless, some legal tech leaders believe that hallucinations can be eliminated completely.
Legal tech companies are taking different approaches to address the “hallucination challenge,” from refining training data to improving AI oversight and validation systems. Many companies focus on “grounding” AI models in authoritative legal content, ensuring they pull from verified sources rather than relying solely on predictive algorithms. Others are developing fact-checking layers and human-in-the-loop review processes to minimize errors before outputs reach end users.
Here’s what the heads of these companies had to say about hallucinations:
Scott Stevenson, CEO, Spellbook: “If you force an AI tool to do something that is impossible, it will hallucinate. If you give it achievable tasks and supply it with correct information that can fit in its short-term memory, it generally will not. We no longer hear of customers complaining about hallucination at Spellbook.”
Daniel Lewis, CEO, LegalOn Technologies: “Eliminating hallucinations entirely may be out of reach for now but substantially reducing them is achievable. At LegalOn, we do this by grounding AI in authoritative legal content built by our in-house lawyers, ensuring accuracy from the start. Thoughtful product design can also make a big difference in helping users quickly evaluate the reliability of an AI-generated answer.”
Kara Peterson, Co-Founder, descrybe.ai: “Given how quickly AI has advanced, it’s hard to imagine that hallucinations won’t eventually be solved. I expect AI will develop self-monitoring capabilities, which could potentially eliminate this issue once and for all.”
Katon Luaces, President & CTO, PointOne: “Some amount of ‘hallucination’ is done even by humans when reasoning and writing, we just frame them differently. These errors are fundamental to the pursuit of complex tasks and will never be eliminated completely. That said, for certain tasks, AI already has a lower error rate than the 75th percentile lawyer and will continue to improve.”
Ted Theodoropoulos, CEO, Infodash: “Currently, no legal tech company has completely eradicated hallucinations in AI outputs. Some vendors claim to have solved this issue, but such assertions often don’t withstand thorough examination. Given the substantial investments in AI research, many of the brightest minds are dedicated to addressing this challenge, which suggests a positive outlook. However, as of now, hallucinations remain an inherent aspect of large language models, and ongoing efforts continue to mitigate this issue.”
Nathan Walter, CEO, Briefpoint: “Hallucinations are a symptom of LLM’s infancy – not a requisite part of their functionality. They can and will be solved through ‘trust but verify’ implementations wherein all generated citations can be quickly verified by the user.”
Dorna Moini, CEO/Founder, Gavel: “LLMs sometimes generate errors or ‘hallucinations’ due to the way they predict text based on patterns in data. Developers are making progress with safeguards and improved models to reduce these occurrences. While it may not be possible to completely eliminate them, continuous improvements should help make AI more reliable for legal applications.”
Colin Levy, Director of Legal, Malbek: “Unclear. This seems to be awfully dependent on a) how these models are designed and b) the amount (breadth + depth) of data used to train the models on. Currently, data set size is a major limitation of existing models.”
Gil Banyas. Co-Founder & COO, Chamelio: “Hallucinations are an inherent feature of LLMs, but that’s okay. Leading legal tech companies are building comprehensive systems where LLMs are just one component. With the right checks and balances in place, hallucinations can be effectively contained.”
Arunim Samat, CEO, TrueLaw: “LLMs, by their nature, are probabilistic generating machines, and with probability, nothing is certain. Hallucinations are highly use-case-specific. In document classification for eDiscovery, hallucinations are easier to measure using standard precision and recall metrics. In contrast, generative tasks present greater challenges, though the risk can be minimized—almost to zero—using grounding techniques. However, given the probabilistic nature of LLMs, there are no statistical guarantees. Eliminating hallucinations entirely would imply creating an “information black hole”—a system where infinite information can be stored within a finite model and retrieved with 100% accuracy. In its current form, I don’t believe this is possible.”
Greg Siskind, Co-founder, Visalaw.ai: “I think we will have this problem for a couple of years but at a diminishing rate. I think after about five years or so the problem a lot have largely disappeared.”
Charein Faraj, Legal Operations Manager, LexCheck Inc.: “Legal tech companies might not be able to eliminate hallucinations entirely, but they’re putting stronger guardrails in place to keep them in check. Engineers are using structured prompts, fine-tuning models, and building smarter architectures to reduce them. Plus, companies are rolling out advanced validation layers, fact-checking systems, and other safeguards to catch and correct errors. While hallucinations are likely to stick around as a natural part of LLMs, these improvements will go a long way in making legal AI more accurate and reliable.”
Mitchell Kossoris, Co-Founder and CEO, Deposely: “As with any technology, flaws like these will probably never be completely eliminated. However, there have been significant advances both in model technology and in data augmentation in just the last 6 months that have vastly improved accuracy. When paired with improved explainability and citation features, AI-generated responses are becoming much more verifiable and trustworthy.”
Troy Doucet, Founder, AI.Law: “This actually isn’t hard to avoid from a programming issue for a company building on top of LLMs. The LLMs themselves will figure this out too once they make it a priority.”
Chris Williams, Head of Strategic Partnerships & Community, Leya: “It’s important to reference citations and rely on validated sources to manage the risk of inaccurate outputs. Some degree of error remains inherent in current AI models, necessitating human review.”
Jenna Earnshaw, Co-founder & COO, Wisedocs: “AI hallucinations are an inherent challenge of LLMs. While they may never fully disappear, legal tech companies can significantly reduce them with smarter AI design. In law, where accuracy is everything, even one AI-generated mistake—like the Canadian lawyer citing fake precedents—can be a serious liability. But fixing this issue isn’t just about human oversight—it starts with using AI built for the job. How do we cut down on hallucinations? Extractive AI. Instead of generating new interpretations, extractive AI pulls and organizes key details directly from source documents, keeping everything factually accurate.”
Will AI Change the Billable Hour Model?
AI’s increasing role in legal workflows may be putting pressure on the billable hour model. While some firms have already transitioned to flat-fee and subscription-based billing structures, others remain hesitant to abandon traditional hourly billing.
Most legal tech leaders agree that AI will drive efficiency and encourage alternative pricing models, but the complete demise of the billable hour remains unlikely in the near future:
Scott Stevenson, CEO, Spellbook: “Yes. We see many boutique firms moving into flat fee billing, increasing their margins substantially.”
Daniel Lewis, CEO, LegalOn Technologies: “Reports about the death of the billable hour continue to feel exaggerated. AI-driven efficiencies will push clients to put pressure on the amount of time billed, but rather than a dramatic overturning, we’ll see adaptation. Many clients still prefer the billable hour for certain work, and firms will evolve to deliver more value and perhaps different services — faster and in less time. The real competition will be in who can leverage AI to provide the best services, not just on billable hours and rates.”
Kara Peterson, Co-Founder, descrybe.ai: “Absolutely. The billable hour likely won’t disappear entirely, but there will be significant pressure on this payment model, forcing it to evolve. I can envision a future where flat fees and even subscription-based models become far more common. While these changes may start at the lower end of the market, that’s not a given. Additionally, as AI makes time-consuming tasks more efficient, we may actually see hourly rates rise for human lawyers—especially for high-level legal expertise.”
Katon Luaces, President & CTO, PointOne: “AI will continue to put pressure on law firms to adopt alternative fee arrangements and even make some tasks completely non-billable.”
Ted Theodoropoulos, CEO, Infodash: “The billable hour has been the cornerstone of the law firm economic model for 50 years, but AI is increasingly challenging its dominance. AI-driven tools are significantly reducing time spent on tasks like document review legal research, and contract drafting. As a result, clients are demanding value-based pricing, pushing firms toward alternative fee arrangements (AFAs) such as fixed fees and subscription models. ALSPs and Big Four firms like KPMG are already leveraging AI for scalable, cost-effective legal services. If traditional firms do not adapt, these entrants will capture the value-driven segment of the market.”
Nathan Walter, CEO, Briefpoint: “AI is changing the billable hour – many firms using Briefpoint have switched to flat rate billing on the tasks Briefpoint automates (discovery response and request drafting). Elimination of the billable hour is another story, and I don’t think we’ll see that in the next five years – eliminating the billable hour would require a fundamental restructuring of firms’ business model, not to mention a revision of attorney fee-shifting statutes. Law firms will maintain their business model until it doesn’t work. For the business model to ‘not work,’ law firms must lose business because of the billable hour. While we’re seeing significant increases in in-house teams asking about AI usage, that’s a far cry from conditioning representation on flat-rate billing.”
Dorna Moini, CEO/Founder, Gavel: “AI is already shifting the landscape away from the traditional billable hour by enabling alternative business models. These models can offer clients greater transparency on costs and outcomes while allowing lawyers to work more efficiently and profitably. This change benefits both sides by aligning pricing with value rather than time spent.”
Colin Levy, Director of Legal, Malbek: “AI will allow law firms to more easily scale work, e.g. take on more work without increasing headcount. AI will also increase competitive pressures from ALSPs and alternative fee arrangements. The outright disappearance of the billable hour is unlikely given current economic and technical factors.”
Gil Banyas. Co-Founder & COO, Chamelio: “AI won’t eliminate the billable hour in the short term, but it will force firms to evolve their pricing. As routine tasks become automated, firms will need to shift toward value-based pricing for complex work while offering fixed fees for AI-assisted tasks.”
Arunim Samat, CEO, TrueLaw: “We believe that law firms investing in proprietary AI models will unlock new revenue streams by monetizing their expertise. By training AI on their unique knowledge and experience, firms can offer novel, AI-powered services that were previously impractical. Since these services have predictable costs, they lend themselves well to flat-fee arrangements, allowing firms to introduce new revenue models without immediately disrupting the traditional billable hour structure. We’re already seeing firms offer proactive litigation risk monitoring and other recurring AI-driven services to their clients.”
Greg Siskind, Co-founder, Visalaw.ai: “I think that is inevitable. And practice areas like immigration, which are largely flat billed already, we’re seeing more rapid adaptation of AI and more innovation in that space. I think the rest of the bar will follow.”
Charein Faraj, Legal Operations Manager, LexCheck Inc.: “AI will definitely change the billable hour, but it won’t make it disappear entirely. As legal AI tools streamline workflows and improve efficiency, more firms will likely shift toward flat-fee or value-based pricing models, especially for routine work. However, billable hours will still play a role, particularly for complex matters that require deep legal expertise. That said, once firms fully leverage AI, the billable hour may no longer be the most lucrative model.”
Mitchell Kossoris, Co-Founder and CEO, Deposely: “AI will push the needle towards alternative fee arrangements at a rate faster than ever before. It is inspiring more innovation in how law firms bill their clients, especially for the work that AI is accelerating. However, AI is also increasing efficiency and allowing firms to take on more cases, which could offset this trend and even lead to increased profitability.”
Troy Doucet, Founder, AI.Law: “In 10 years, we won’t have billable hours the way they exist today, if at all. Value of lawyers will be derived from broader engagement with their clients- things like strategy and risk management.”
Chris Williams, Head of Strategic Partnerships & Community, Leya: “Efficiency gains from using AI is reducing the time spent on routine work, leading to alternative billing models (such as flat fees or value-based pricing), while the billable hour might still be used as an internal performance metric. Ultimately, AI will likely change how legal work is billed without entirely eliminating traditional metrics.”
Jenna Earnshaw, Co-founder & COO, Wisedocs: “Absolutely—but not everyone is on board just yet. Some law firms are resistant to AI because it threatens the traditional billable hour model. If AI can handle document review, legal research, and analysis in a fraction of the time, that means fewer billable hours. But here’s the catch: as more firms embrace AI, clients will start expecting the same efficiency everywhere. Law firms that resist AI risk falling behind as clients demand faster, more cost-effective legal services. Instead of measuring value by hours worked, the industry will shift toward a more results-driven approach—where expertise, strategy, and outcomes matter more than time spent on tedious tasks. Billable hours won’t disappear overnight, but AI is already pushing the legal industry toward a future where efficiency and results take center stage.”
Will AI Replace Lawyers?
As AI continues to improve, the question of whether it will replace lawyers remains a topic of debate. While AI excels at automating routine legal tasks, legal tech leaders largely agree that it lacks the judgment, strategic thinking, and interpersonal skills necessary to fully replace attorneys. Instead, AI is largely expected to augment legal professionals, allowing them to focus on higher-value work while automating administrative and repetitive processes.
Here’s what legal tech leaders had to say about whether AI will replace lawyers:
Scott Stevenson, CEO, Spellbook: “No. Even if you can automate legal work, clients can’t understand what the documents you produce mean, and they ultimately need to be able to trust a human’s judgment. We built a product that cut out lawyers that worked fairly well, six years ago, but most users didn’t like it because they had “DIY anxiety” and ultimately needed a human to guide them through their matter.”
Daniel Lewis, CEO, LegalOn Technologies: “No, AI will not replace lawyers, but it will change and elevate how they work. In contracts, for example, AI helps with line-by-line contract review, freeing lawyers to focus on judgment, context, and strategy—where expertise makes the biggest impact.”
Kara Peterson, Co-Founder, descrybe.ai: “In a sense, yes—but not in the way many fear. AI will replace rote, mundane legal tasks, but not the entire legal process. If anything, AI will augment lawyers rather than fully replace them. In fact, the “human-in-the-loop” lawyer will become more critical than ever to handle nuance and complexity that AI simply can’t.”
Katon Luaces, President & CTO, PointOne: “AI will certainly replace some of the work of lawyers just as lawyers no longer manually shepardize nor personally walk documents to the courthouse. That said, the practice of law is fundamental to government and commerce. While the work of a lawyer may become unrecognizable, there will be individuals who practice law.”
Ted Theodoropoulos, CEO, Infodash: “AI will not replace lawyers in the immediate future, but it will fundamentally reshape their roles. While AI excels at automating routine tasks (e.g. contract analysis, eDiscovery, and brief drafting), it lacks the human judgment, emotional intelligence, and ethical reasoning required for complex legal matters. Over the next 2-3 years, we will see AI shift legal work toward advisory and strategic functions, but full lawyer replacement remains unlikely. The firms that embrace AI as a complement rather than a competitor will be the ones that thrive in the evolving legal landscape.”
Nathan Walter, CEO, Briefpoint: “There are some components of the job that need human-to-human connection – I don’t think a jury will ever warm up to an AI trial attorney in the same way I lose interest in a piece of media once I find out it’s made by AI. The parts that don’t need a human touch? Those will be gone.”
Dorna Moini, CEO/Founder, Gavel: “No, AI will not replace lawyers. There’s a large gap in legal services that needs to be filled, and while AI can assist with some routine functions, it can’t bridge that gap in legal services on its own. Lawyers will continue to be vital in offering the nuanced support and guidance that many clients need. Instead of replacing lawyers, AI can serve as a tool to help them better serve not just underserved communities, but the middle class and digitally-inclined clients as well.”
Colin Levy, Director of Legal, Malbek: “We do not know how our own brains work especially around self-awareness, so to somehow expect AI to do the same anytime soon is highly unlikely.”
Gil Banyas. Co-Founder & COO, Chamelio: “AI won’t replace lawyers, but it will reduce the number needed as it automates routine legal work. While AI excels at tasks like document review, it can’t replicate lawyers’ judgment, strategic thinking, and emotional intelligence. The future lawyer will be more efficient and focused on high-value work, but firms will likely need fewer attorneys to handle the same workload.”
Arunim Samat, CEO, TrueLaw: “We believe AI will create 10x lawyers—legal professionals who can accomplish 10 times more work in the same amount of time. While certain legal functions will inevitably be affected, this shift isn’t unique to the legal industry—it’s happening across every sector. To thrive in an AI-augmented world, professionals must reimagine their workflows and daily operations. The key is adaptability: those who embrace AI and rethink how they work will unlock unprecedented efficiency and value, while those who remain rigid and resistant to change will struggle to keep up in this evolving landscape.”
Greg Siskind, Co-founder, Visalaw.ai: “No. But lawyers will lead legal teams that include paralegals, lawyers, and AI. With the rise of genAI, roles will evolve where a lot of the tasks performed by paralegals and lawyers will be performed by AI, and humans will increasingly play more of a ‘sherpa’ role managing the tech and personally guiding their clients through the legal process.”
Charein Faraj, Legal Operations Manager, LexCheck Inc.: “No, AI won’t replace lawyers, but it will fundamentally change the practice of law. It can help struggling associates learn faster, adapt more quickly, and gain expertise in less time. AI will also reshape the business model of law firms—potentially leading to more hiring as firms take on an increased volume of work. Additionally, AI is creating new opportunities for attorneys in adjacent fields like legal operations and AI-driven legal tech, opening up career paths that didn’t exist before. In some areas of law, AI may reduce the need for as many attorneys by cutting down busy work, but overall, it’s more about transformation than replacement. Rather than making lawyers obsolete, AI is redefining how they work and where their skills are most valuable.”
Mitchell Kossoris, Co-Founder and CEO, Deposely: “AI won’t replace lawyers anytime soon. Lawyers don’t simply recite law and design legal strategies. They provide nuanced judgment, empathy, and advocacy—qualities that are crucial in client relationships and that AI still struggles with. The human aspect of attorney-client relationships cannot be understated, and clients need a real person they can connect with to reassure them, especially in high-stakes matters.”
Troy Doucet, Founder, AI.Law: “No. Lawyers will become managers of AI.”
Chris Williams, Head of Strategic Partnerships & Community, Leya: “The quote, ‘Artificial Intelligence won’t replace lawyers, but lawyers using it will’ still stands true.”
Jenna Earnshaw, Co-founder & COO, Wisedocs: “No, AI won’t replace lawyers—because the law isn’t just about processing information; it’s about judgment, strategy, and advocacy. AI can be a powerful tool for streamlining tasks like document review and legal research, but it can’t think critically, navigate ethical dilemmas, or argue a case in court. Plus, human oversight is essential to ensure fairness and catch biases in AI models. Rather than replacing lawyers, AI is helping them by handling tedious admin work, freeing up time for higher-level thinking and client advocacy. The future of law isn’t AI vs. lawyers—it’s AI empowering lawyers to work smarter and deliver better results.”
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As legal tech companies continue to improve their offerings, the legal profession may continue to undergo fundamental changes to the practice of law— reshaping workflows, redefining the billable hour, and transforming the role of lawyers in ways we are only just beginning to understand.
The Risks of 50-50 Owned Business Partnerships: This Marriage of Equals Does Not Guarantee Success
During Valentine’s Day month, we are taking a look at 50-50 owned private businesses. Forming a co-owned company may sound like a good idea on paper because the two partners are close friends or family members who are making the same investment, sharing equal control, and receiving the same financial returns. But, as in marriages, the co-owners may run into conflicts they cannot resolve, which could require a costly business divorce. This is the chief problem with these co-owned businesses: When conflicts arise the partners cannot work out, they will be in a position of deadlock that distracts or ultimately derails their business.
The Deadlock Dilemma Is the Real Deal
The risk of a co-owned business capsizing over unresolved conflicts between the owners is substantial and many of these companies come apart because the partners failed to create any type of dispute resolution process. Here are two examples: first, the ubiquitous Buffalo, New York, law firm of Cellino & Barnes, broke up in 2020 after 25 years, but only after the partners engaged in a highly publicized, three-year-long legal battle resulting in a court-ordered buyout. The litigation between the two law partners was so contentious it led to an off-Broadway play produced about the case. The second example is the lengthy legal battle between the co-CEOs of TransPerfect Global, Inc., the translation services company, which the parties finally settled in 2020 after six years of litigation.
In light of the high risk of conflicts arising in the future between the co-owners of these businesses, the two partners should consider whether this ownership structure is truly their best option. If they do decide to go down this road, however, the good news is that they have some options to consider. This post reviews specific, practical steps the co-owners can take to head off problems that might otherwise cause their partnership to end in a bitter feud.
Another Approach: Shared Financial Returns, But Not Equal Co-Ownership
One approach for the partners to consider that will avoid future conflicts is to adopt an ownership structure that provides financial equality, but with a modified ownership percentage. Under this approach, the partners would agree to an ownership percentage of 51% to 49%, but also agree in the company’s governing documents to share equally in the company’s profits and losses, as well as in the amount of their compensation. This structure provides for both partners to share the same financial results from the company’s performance, but it establishes a process for decision-making by the company that will not result in gridlock.
Further, the majority owner will have the right to make operating decisions on a day-to-day basis for business, but the minority partner will also have veto rights over some of the most important decisions, and these will be subject to negotiation. By way of example, the partners may decide that a unanimous vote of both of the partners will be required to admit new partners, to approve the sale of the business, and/or to permit the company to take on debt above a certain amount. This structure thus avoids conflicts over most of the decisions that need to be made to keep the business moving forward.
Create a Set of Clear Tie Breakers
For partners who are insistent on having equal ownership in the company, it is critical for them to adopt a tie-breaking mechanism that will prevent them from reaching the point of deadlock over future business decisions. Some of the tie-breaking options available to the partners are reviewed below.
Zones of Authority
For certain companies, the roles of the two partners will be distinct, and in those businesses, the partners may be able to agree that each partner will have the authority to make decisions in their own domain. For example, a partner in charge of marketing and business development may be given authority to decide on what the website will look like, who to hire/fire in the marketing/sales department, and what marketing strategy to adopt. Similarly, a partner running the company’s back office may have the authority to select the accounting software and the CPA firm the company uses, to set pricing on products or services, and to hire a CFO or comptroller.
The problem with this approach is that the partners will have to agree on some decisions that do not fall into these clear categories and they may have conflicts deciding other issues, such as the amount of the company’s expenses, profits distributions, acceptable debt level and growth rate. The bottom line here is that there will still be many common areas in which a potential deadlock may arise between the partners.
Create a Neutral, Tie-Breaking Authority
The obvious tiebreaker is for the partners to agree to appoint either one person or a small committee or board (usually three people) who have some industry or other experience and who will make decisions to resolve all conflicts between the partners. While this approach sounds reasonable, it may be difficult for the partners to agree on the selection of one person or of a board of three people to serve in this capacity for the company.
In addition, even if the partners can agree on the specific person or people they wish to appoint, these individuals may not be willing to take on this role knowing that, at some future point, they will disappoint one of the partners by making a final decision that rejects the other partner’s position. To persuade anyone to serve in the capacity of a tiebreaker, the partners will also, at a minimum, have to agree to fully indemnify the people who agree to serve in this role. The partners will also have to agree to pay the legal fees for any and all disputes incurred by the tiebreakers in which they become involved because they agreed to serve in this role.
Adopt an Arbitration Procedure
For more complex disputes, the partners could agree to arbitrate these conflicts on a fast-track basis that resolves the dispute in 60-90 days. This is a much more formal approach to conflict resolution as it would involve using a private arbitration service, but the process will result in a clear, final and non-appealable result.
Further, before the parties agree to participate in arbitration, they could require that a mandatory, in-person mediation be held before any arbitration is filed. This would requires the parties to engage in one last mediated settlement conference in efforts to reach a resolution before they start any sort of legal process.
Enter Into a Negotiated Buy-Sell Agreement
Even when the partners do appoint an individual or board to resolve any conflicts that arise between them in the future, that may not end their discord. The partner whose position was rejected by the individual or board may be frustrated by the outcome, have hard feelings toward the other partner, and/or be concerned the company is now going off track. In this situation, the partners need to have a buy-sell agreement in place that provides a clear process for the exit of a partner to take place. If there is no off ramp for a disgruntled partner, things may go downhill rapidly in the business, because this unhappy partner may decide to create disruption (or worse) in the business in order to pressure the other partner to buy out that partner’s interest. These types of legal disputes between co-owners involving claims for breach of fiduciary duties can create significant distractions and substantial expense for the partners and the business.
The buy-sell agreement between the partners needs to address all of the following issues: (1) what are the circumstances under which the buy-out can be triggered (who can trigger it and how is it triggered); (2) what is the process for determining the value that will be paid for the departing partner’s ownership interest in the business at the time of exit; (3) what specific terms apply to the buyout payment (how many years, what interest rate and what collateral will be provided in the event of a default); and (4) what is the dispute resolution process for resolving any conflicts that arise regarding the application of the buy-sell agreement.
A critical part of this buy-sell agreement will be the process for deciding who is the buyer and who is the seller. This is often termed a “shotgun” provision, and it operates by allowing one person to make an offer to purchase the interest of the other partner, then the recipient will have the option to accept the purchase offer or to reject it and then become the buyer.
How this provision will work in practice therefore needs careful consideration to ensure that the business goals of the parties will be achieved if the clause is triggered in the future.
Conclusion
Starting a 50-50 owned business is exciting, but it is also inherently risky because it almost certainly requires the close collaboration of both of the partners on a long-term basis for the business to be successful. When the partners have serious disagreements, that can lead to a deadlock that cripples the business because key decisions will be postponed, investments will not be made, and opportunities will be missed. Also, the lack of clear direction when the two partners are locked in an impasse is likely to have a negative impact on both the company’s employees and customers.
If the two partners remain willing to accept these risks of entering into a co-owned business, they will want to do so with vigilance to head off future conflicts as much as possible. This planning process will require them to implement a tie-breaking process designed to resolve future disputes, as well as to negotiate and enter into a buy-sell agreement that enables them to achieve a business divorce if they reach a point where irreconcilable differences exist between them.
For both partners to keep smiling on Valentine’s Day and beyond, these planning measures will give them and the business the best chance to prosper on a long-term basis, and it will also provide a plan for a partner exit to help avoid a bitter, protracted business divorce down the road.
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The New Legal Synergy: Collaborative Intelligence with Lawyers and Agentic AI
It’s easy to dismiss new technology as impractical for an industry as established as law. But we’re well past the speculation phase. AI isn’t a theoretical disruptor — it’s already here, reshaping legal work in real-time.
The legal industry has witnessed a staggering increase in AI adoption, from a mere 19% in 2023 to an impressive 79% in 2024. In the UK alone, 41% of legal professionals now use AI for work, up from just 11% in July 2023. The dramatic surge in AI adoption is not just the latest “hype cycle”, it marks the beginning of a fundamental shift in how legal work is done.
The traditional image of a lawyer pouring over dusty tomes and case files is fading. AI-powered tools are becoming integral to legal practice. But what we’ve seen so far with generative AI is just the beginning. The fundamental transformation will come with agentic AI.
Agentic and reasoning: the next frontier of AI
Agentic AI, the next frontier beyond generative AI, is poised to revolutionize legal work. Unlike its predecessor, agentic AI uses advanced AI systems capable of independently performing complex research or document drafting tasks. These AI systems can accomplish tasks with minimal human oversight and even check their own work before human review.
Large law firms are already experimenting with agentic AI, with experts predicting that AI systems could soon be members of legal teams. This gradual integration is expected to continue, emphasizing training and preparation.
Advanced legal reasoning, powered by AI
One of the most promising applications of agentic AI in the legal field is advanced legal reasoning (ALR), which goes beyond simple document analysis or basic research tasks.
ALR allows lawyers to upload tens of thousands of documents and conduct deep analyses to uncover insights into the strengths, weaknesses, and potential strategies buried in the complexities of the facts and issues — all within minutes. Leveraging the most advanced AI systems, ALR streamlines complex workflows, enabling lawyers to make informed decisions faster than ever.
It can interpret complex legal scenarios, apply relevant case law and statutes, and even suggest strategic approaches to legal problems. Lawyers can ask ALR systems questions like, “What is the weakest part of our claim concerning liability?” By analyzing key documents and referencing leading legal authorities, the ALR platform would provide a detailed, actionable response.
For example, when asked about a spouse’s income for child support calculations, ALR first employs an agent to search for the legal standard, then uses another agent to apply that understanding to case documents and extract the necessary information.
The impact of advanced legal reasoning tools is already evident. A staggering 71% of lawyers cite faster delivery as a key benefit of AI, while 54% report improved client service. Unsurprisingly, 78% of large law firms and 74% of corporate in-house teams have implemented AI changes.
Considerations for law firms adopting agentic AI
As agentic AI becomes more integrated into legal practice, firms must navigate ethical considerations and data privacy concerns. About two-thirds (70%) of firms prioritize data privacy policies when vetting technology vendors and litigation support providers. This focus on data protection is crucial, as 76% of legal professionals express concern about inaccurate or fabricated information from public AI platforms. To address these privacy and security concerns, a growing pool of legaltech companies is helping law firms adopt self-hosted AI solutions built to run within a firm’s private cloud ecosystem.
The future of agentic AI in law
Looking ahead, the future of law is undeniably intertwined with AI – from established firms to schools teaching the next generation of lawyers.
Two-thirds (75%) of organization leaders expect to change talent strategies within two years due to AI advancement. Law schools are already integrating generative AI training for new junior lawyers, preparing the next generation for an AI-powered workforce.
But let’s be clear: AI is not here to replace lawyers. It’s here to make them better. Those who embrace it — who approach it with curiosity and a willingness to adapt — will gain the most. The legal industry isn’t losing its expertise. It’s gaining new tools to apply that expertise more effectively.
If you take this shift seriously, AI won’t just change how you practice law — it will give you an edge.
Strategic Staffing: Key to Transitioning Founder-Owned Law Firms
Challenges in Transitioning Founder-Owned Law Firms
Transitioning a founder-owned law firm to the next generation presents significant challenges. Leadership and management development, along with client retention issues, require long-term strategic planning; a decade-long perspective is recommended. Founding lawyers often hesitate to plan for succession while still in their prime. However, perspectives can change significantly between one’s mid-50s and mid-60s.
Unique Abilities of Founders
Founders typically have unique abilities to attract clients and achieve results. Many first-generation firms value lawyers who support current client work and bolster the founders’ success. Recognizing supporting lawyers for their legal contributions rather than their ability to develop new business or manage the firm is typical. Consequently, what seems like a well-functioning firm today is not sufficient for a second generation of leadership.
The Need for a Strategic Staffing Process
Firms should develop a strategic staffing process to address this inevitability and ensure the retention of existing clients while attracting new business. The initial step involves a 10-year projection of critical roles and staffing needs for each major client or practice area.
Next, the potential of current staff to fill these roles in the long term should be evaluated, considering individuals beyond the current client service team as appropriate.
Evaluating and Recruiting Staff
If internal resources are insufficient, targeted recruitment becomes necessary. Strategic client staffing also helps younger lawyers build essential relationships, reducing competitive threats. It is important to review practice area and client staffing every three years and make necessary adjustments.
Challenges and Importance of Strategic Staffing
Implementing a strategic staffing approach is challenging and may face resistance internally and from clients. Nonetheless, it is an essential component of the firm’s continued success.