Anthropic pushes further into legal tech as incumbents respond

In short: AI firms, led by Anthropic, are moving deeper into tools for lawyers, and established legal tech providers are responding by upgrading products and leaning on trusted legal content.

What's going on

New AI-focused companies are putting pressure on long-time legal software providers. Legal AI start-up Harvey has reached an $11bn valuation and says it works with about half of the biggest US law firms. Another rival, Legora, is also growing and has actor Jude Law as a spokesperson.

Anthropic has drawn particular attention. In late January, it introduced a tool aimed at automating routine legal work like reviewing contracts. That announcement worried investors and helped push down the share prices of companies such as Thomson Reuters and Relx, which owns LexisNexis.

In the past three months, Anthropic expanded again. It released around a dozen new plug-ins (add-ons that connect software tools, like adapters that let devices work together) and linked its Claude assistant to more than 20 legal software platforms. Rather than only competing, some incumbents are partnering. Thomson Reuters and LexisNexis have expanded their work with Anthropic to bring Claude features into their products.

What to watch

Law firms and in-house legal teams are weighing cost, privacy, and accuracy. Recent court and law firm incidents highlighted risks, including questions about whether chats with an AI are protected by attorney-client privilege and filings that contained AI-generated errors. Analysts expect many legal teams to use a mix of tools, choosing different providers depending on the task.

Source: Financial Times