Judge Rejects Law Firm’s Use of AI Tool for Fee Estimation, Citing Unreliability

According to Bloomberg Law, a law firm’s attempt to use the AI tool ChatGPT to estimate legal fees was rebuffed by a federal judge, highlighting the challenges of integrating AI into the legal industry. 

The Cuddy Law Firm sought over $113,000 in fees from New York City after representing a child with disabilities. However, US District Judge Paul Engelmayer awarded only $53,000, criticizing the firm’s reliance on ChatGPT as “utterly unpersuasive.” 

Engelmayer emphasized that ChatGPT’s conclusions were not suitable for determining reasonable billing rates for legal work in niche areas. The decision underscores ongoing debates about AI’s role in law, especially after incidents like Michael Cohen inadvertently including AI-generated cases in a legal brief. 

The firm’s lawyer, Benjamin Kopp, defended their use of ChatGPT, claiming it was for providing context on legal industry norms. However, Judge Engelmayer referenced prior cases where lawyers faced penalties for using AI-generated content and cautioned against future reliance on ChatGPT without improved reliability, and emphasized the importance of real data points, urging the firm to refrain from using ChatGPT in future fee requests unless its reliability significantly improves.