DoNotPay has to pay for “the world’s first robot lawyer”

DoNotPay, the AI ​​company best known for helping users cancel unwanted subscriptions and contest parking tickets, has reached a settlement with the FTC over an AI chatbot that was touted as “the world’s first robot lawyer.” The AI ​​lawyer failed to deliver on its promises and DoNotPay never properly tested the chatbot tool, the FTC said. In fact, the company reportedly never hired a real human lawyer to work on the product.

DoNotPay has agreed to pay $193,000 and must send a notice to all previous customers who used the AI ​​lawyer from 2021 to 2023, advising them of the subscription service’s limitations. The settlement will also “prohibit the company from making claims about its ability to replace any professional service without being able to provide evidence of that,” the FTC said in a statement Wednesday.

The AI ​​lawyer promoted itself as a tool that could be used for things like personal injury lawsuits in small claims court and drafting a cease and desist letter. According to the FTC, the AI ​​tool also created legal documents like non-disclosure agreements, business contracts, prenuptial agreements, and custody agreements. DoNotPay had originally planned to use its AI lawyer in a physical courtroom, but abandoned that plan in early 2023 after receiving threats from state bar associations.

The FTC’s complaint, which is available online, contains some pretty odd details, including a quote on the DoNotPay website that purports to be from the Los Angeles Times: “What this robot lawyer can do is astonishingly similar — if not better — than what human lawyers do.” In reality, the quote is from the Los Angeles Times. High School Insider Website, a user-generated content platform for high school students, according to the FTC.

Additionally, according to the FTC complaint, the tool was not tested in a way that a reasonable person would expect:

DoNotPay’s employees have not reviewed the quality and accuracy of the legal documents and advice generated by most of the Service’s legal-related features. DoNotPay has not employed or retained any attorneys, let alone attorneys with the appropriate legal expertise, to review the quality and accuracy of the Service’s legal-related features.

The AI ​​company’s founder, Joshua Browder, has previously stated that DoNotPay aims to “replace the $200 billion legal industry with artificial intelligence.” Browder dropped out of college in 2018 as part of the Thiel Fellowship, a program created by technology investor Peter Thiel that gives people money to drop out of college and start a business.

For its part, DoNotPay quickly stated that the company had not admitted any liability in its settlement with the FTC.

“DoNotPay is pleased to have worked constructively with the FTC to settle this case and fully resolve these issues without admitting liability,” the company said in a statement attributed to an unnamed “DoNotPay spokeswoman.”

Gizmodo asked about allegations that the company did not hire a lawyer to review the work of its AI attorney, but those questions were not answered in the company’s statement. It is not clear whether the statement was created by an AI or written by a human.

“The complaint relates to the use of services by several hundred customers several years ago (out of millions of people) that have long since been discontinued,” the statement continued. “DoNotPay has retained Maneesha Mithal, former deputy director of the FTC, as outside legal counsel, who has been incredibly helpful in handling this matter.”

“Using AI tools to trick, mislead or defraud people is illegal,” Khan said in a statement on the agency’s website.

“The FTC’s enforcement actions make it clear that there is no exemption from existing laws for AI,” Khan continued. “By cracking down on unfair or deceptive practices in these markets, the FTC is ensuring that honest companies and innovators get a fair chance and consumers are protected.”