CORRECTED-Lawyers flood tech expo wondering: Is AI about to devalue their time?

By David Thomas and Mike Scarcella

March 12 (Reuters) - (Billable Hours is Reuters' weekly report on lawyers and money. Please send tips or suggestions to D.Thomas@thomsonreuters.com)

The future of the billable hour was a burning question at the LegalWeek conference in New York this week, where artificial intelligence is dominating the annual legal technology gathering.

Will an efficiency explosion fueled by AI leave clients unwilling to pay lawyers hundreds or thousands of dollars an hour? Will law firms charge even more but offer different services? How will firms absorb the costs of AI tools that clients are now demanding?

“These things are expensive,” said Martha Louks, a technology director at law firm McDermott Will & Schulte, in a panel discussion on AI's impact on attorneys' work and what they charge. “We are going to be burning through tokens,” she said, using the industry term for the small chunks of text AI systems process and bill for.

About 7,000 lawyers, tech executives, computer scientists and marketers jostled for space on an exhibition floor at the Javits Center. Legal AI firms and startups demonstrated software that can search through libraries of legal documents in the time it takes a lawyer to send an email, draft and revamp contracts, or uncover trends affecting a law firm’s clients and suggest a marketing pitch.

One of the participants, Swedish startup Legora, announced on Tuesday that it had raised $550 million to expand in the U.S., reaching a $5.5 billion valuation. Vendors handed out swag, from plushies and golf balls to sunglasses, branded with names like Billables.AI and Litify. (Reuters parent company Thomson Reuters, which also owns legal AI platform CoCounsel, was among the participants.)

In a conference room above the exhibit hall, Oliver Roberts, who teaches at Washington University School of Law and manages a small AI-focused law firm, said AI “will 100% replace lawyers in the future.” There was nervous laughter in the audience.

A legal AI consultant Oz Benamram predicted at another meeting that in three years, companies would use AI to do half of the work they now pay law firms to do.

“Companies want fast results,” he said — though he also said clients would pay $10,000 an hour for human lawyers whose judgment AI can’t match. Other presenters said as AI automation speeds up routine legal tasks, law firms could use their extra time to offer more bespoke, complex advisory services.

Attorneys and product reps had to be turned away from some meeting rooms due to overcapacity, including a workshop by legal and compliance company Epiq for lawyers to learn how to create their own AI “agents." Most participants were quickly vibe-coding bots to analyze contracts or scour court websites, while some struggled to get past the login screen.

A talk on “strategic legal leadership in the age of AI” became standing room-only before event staff finally barred the doors. Dozens of people still stood in line trying to get in — possibly hoping to pitch their firms or products to the Microsoft, GSK, HSBC and Barclays executives who were presenting.

Some participants acknowledged the stress of trying to adopt such fast-changing technology or to beat others to market. No one said they thought it was slowing down, or that AI was being overhyped.

Two years ago, law firms had to promise their clients that they weren’t using generative AI on their cases, Susan Wortzman, a partner at Canadian law firm McCarthy Tetrault told a roomful of attendees.

“Now they are saying you must use it,” she said.

— New York taps Winston's Jeffrey Kessler for Live Nation antitrust case

The New York attorney general's office is turning to antitrust veteran Jeffrey Kessler of law firm Winston & Strawn to represent the state in its lawsuit against entertainment giant Live Nation LYV.N and subsidiary Ticketmaster.

Kessler joined the case in federal court in Manhattan after the U.S. Justice Department, which brought the lawsuit with New York and other states and was leading the case, said it had reached a settlement with Live Nation.

U.S. District Judge Arun Subramanian, presiding over a trial in the case, this week told Live Nation to negotiate with the remaining plaintiffs after DOJ announced its settlement and left New York and other states scrambling to take over.

Kessler has handled a string of high-profile competition cases in recent years, including the sprawling multibillion-dollar settlement involving U.S. colleges and universities paying student athletes for the commercial use of their names, images and likenesses.

New York declined to offer details on the state's engagement with Kessler, including whether he is charging his standard hourly rate or a reduced amount.

Kessler last year was charging nearly $2,000 an hour in other cases, court records show. Kessler declined to comment. He is working with a team from Winston, including Jeanifer Parsigian.

— Plaintiffs firm founder faces California disciplinary charges

The co-founder of a plaintiffs firm being sued by Uber Technologies is facing disciplinary charges stemming from allegations that he and the firm represented clients in states where they were not licensed.

Salar Hendizadeh, a founder of Downtown LA Law Group, was charged on Monday by the State Bar of California's Office of Chief Trial Counsel.

"The disciplinary charges allege violations of rules regarding unauthorized practice of law that are intended to protect clients by ensuring that they receive legal representation from attorneys familiar with the legal rules and practices that will apply to their claims," George Cardona, the state bar's chief trial counsel, said in a statement.

The disciplinary complaint alleges that DTLA entered into fee agreements with clients in seven states before learning where the clients lived and before identifying local counsel.

Hendizadeh, who left the firm in September 2025, could not immediately be reached for comment. Farid Yaghoubtil, a founding partner at DTLA, did not immediately respond to a request for comment, nor did DTLA's lawyers at Winston & Strawn.

Uber is separately waging a federal lawsuit against DTLA and others, alleging the lawyers conspired with medical providers to create and submit artificially inflated medical bills. The law firm has denied wrongdoing.

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