FTC Takes a Stand Against DoNotPay’s “AI Lawyer” Claims

Key Takeaway

Deep Dive

In a world where AI promises seem to be becoming as frequent as pop-up ads, the FTC’s decision to take on DoNotPay is a notable one. The company, which once boasted about offering “the world’s first robot lawyer,” has now been forced to face the music for its misleading marketing. The Federal Trade Commission has finalized an order against DoNotPay, following an investigation that questioned the legitimacy of their AI-powered legal services.

The company had pitched its AI chatbot as an alternative to a human lawyer, claiming it could handle everything from drafting legal documents to providing legal advice. But as the FTC discovered, the service fell pretty short of the hype. The claims were not just a stretch—they were unsubstantiated and a bit ludicrous. DoNotPay had not tested whether its chatbot could really perform at the level of a trained attorney, nor had they enlisted any legal experts to vet the quality of their “AI lawyer.” In short, they were telling consumers that their technology could replace professional legal advice without any real proof to back it up.

In response, the FTC has slapped DoNotPay with a hefty $193,000 penalty, intended to compensate consumers who were impacted by the false advertising. The company is now also required to notify all customers who subscribed to their service between 2021 and 2023 about the settlement, effectively putting them on notice that the robot lawyer they trusted was a bit of a charlatan.

Now, as much as this ruling is a win for consumers, it’s also a warning for the tech industry—particularly the AI sector. As AI technologies evolve and expand into industries that have long been governed by human professionals, from healthcare to law, the line between marketing and reality can get blurry. The FTC’s action reminds us that making bold claims about AI without evidence isn’t just misleading; it’s a violation of consumer protection laws.

For anyone involved in AI governance, this ruling is a pointed reminder that businesses can’t just push the envelope on innovation—they have to stay grounded in ethics and truth. The ruling sets a precedent for how marketing AI and consumer protection will intersect in the future. It’s about accountability, transparency, and above all, trust.

This case also demonstrates the growing pressure on companies in emerging tech fields to back up their claims with solid data and expert validation. The regulatory environment is evolving, and with that comes an expectation that AI products must be tested, validated, and transparently marketed—particularly when they’re being sold as solutions to complex problems like legal advice.

AI companies need to take a step back and evaluate not just how their products work but how they’re communicating their capabilities to the world. Will your AI chatbot be able to pass LSAT or Bar exam? If not, it's probably best you don’t claim it can replace lawyers. This order isn’t just a penalty for DoNotPay but also could be a roadmap for anyone working in AI development, advertising, and governance.

The future of AI is bright, but it’s also full of responsibility. As this case shows, making big claims without the backing to match could cost you. If anything, this is a lesson in how to take the high road when it comes to AI—one that’s grounded in evidence, transparency, and, most importantly, trust.

The GRC Report is your premier destination for the latest in governance, risk, and compliance news. As your reliable source for comprehensive coverage, we ensure you stay informed and ready to navigate the dynamic landscape of GRC. Beyond being a news source, the GRC Report represents a thriving community of professionals who, like you, are dedicated to GRC excellence. Explore our insightful articles and breaking news, and actively participate in the conversation to enhance your GRC journey.