Morgan Stanley and Citi Seek Lower Law Firm Fees Over AI Savings

Morgan Stanley and Citigroup have told law firms they want new payment arrangements to cut costs in the AI era. According to Sina Finance, the report also said Goldman Sachs asked law firms how much AI has saved them and wants to share in those benefits. Citi Global Head of Legal Adam Meshel said that if lawyers reduce the time needed to handle a matter by using AI, Citi expects "the cost per deal will fall significantly." Citi has also begun asking law firms to bid for legal work and explain how much money AI has saved them. Meshel said a "different operating model" built this way could be in place within a year. Morgan Stanley General Counsel Eric Grossman said law firms' current fee model has become "extremely unstable."