"When Doug Mandell, the general counsel of chatbot-maker Inflection AI, was working on a new data security policy, he turned to a tool from the legal AI startup GC AI. It chewed through his notes and background material and spit out a draft policy. Mandell then workshopped it in Google Docs before sending it to an outside law firm for review."
"Before he had the tool, Mandell said, he would email outside counsel saying, "We're thinking about doing X, Y, Z," and then wait, racking up billable hours as the law firms tinkered. Now, he tells them, "Start with this." "To be clear, we're not replacing outside counsel," Mandell said. "We're refining the process in a way that benefits the company." AI has landed in law, but the transformation hasn't been evenly distributed."
""In-house lawyers know a finger is being pointed at them, and nobody wants to be in that situation," said the venture capitalist Bogomil Balkansky, whose Silicon Valley firm Sequoia Capital has backed legal startups including Ironclad, Harvey, Crosby, and Sandstone. That dynamic, he said, helps explain why corporate legal teams are becoming eager adopters of new technology that cuts a task from days to minutes, or helps keep work in-house."
Artificial intelligence enables in-house legal teams to draft policies, parse background material, and produce near-final documents that reduce reliance on outside counsel. In-house counsel can iterate drafts internally and send refined versions to law firms for review, lowering billable hours and legal spend. Hourly billing models have slowed AI adoption among traditional law firms, while corporate legal departments view efficiency as a mandate tied to business speed. Venture capital interest and startups are fueling tools that cut multi-day tasks to minutes and help keep work in-house. The adoption pattern remains uneven across the legal industry.
Read at Business Insider
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