The billable hour’s time is approaching midnight, according to Anthropic’s top lawyer.
“I don’t think the billable hour is the solution, and we’ve known it for a long time,” Jeff Bleich, the AI company’s general counsel, said Thursday.
Speaking at the American Bar Association’s White Collar Crime Institute in San Diego, Bleich said that artificial intelligence tools are eliminating the need for companies to hire armies of lawyers to do lucrative yet “tedious” work.
“Now we’ve got a technology that’s going to eliminate the sorts of things that allow people to become wealthy off of tedious work,” Bleich said on the panel, alongside top lawyers at Google, IBM, and Liberty Mutual. “That was not what lawyers are trained to do, and not what we ultimately look to lawyers for.”
The much-maligned billable hour is the standard method that law firms use to bill their clients.
Attorneys track the work done for each client, often in six-minute increments, tally them up, and charge their clients accordingly.
While the billable hour has been useful to help companies and other clients understand what they are paying lawyers for, it has also “created a wedge,” Bleich said.
Under the current system, “the interests of firms are at odds with the interests of their clients,” he said. Companies want lawyers to resolve problems quickly, but law firms get paid more when the work takes longer.
“Clients want you to solve the problem as efficiently as possible and with as little drama as possible,” Bleich said. “And if you’re a company, the bigger the case gets, and the more dramatic it gets, and the more complicated it gets, and the more work that has to be done — the more lucrative it is.”
The other panelists largely agreed with Bleich’s remarks.
“The value is no longer you putting in time,” said Damon Hart, the top lawyer at Liberty Mutual. “The value is your strategy, your results.”
Anne Robinson, IBM’s general counsel, told the audience that she’s open to working with them to figure out more creative billing methods.
“I’m open to firms coming and saying, ‘I’d really like to work with you on this matter or this type of work, I get that the billable hour model is not one of aligned incentives, and so let’s sit down and talk about what you expect as far as outcomes and how we can both get there in a way that reflects your pressures and your priorities,'” Robinson said.
Bleich said he still values the work of outside law firms, but wants them to find an alternative to the billable hour that works for everyone.
“We’re not going to sort of cheap out and starve you,” Bleich said. “On the other hand, you have to have an economic model that works. And the firms that adapt to that faster and better will be leapfrogging other firms, because they’ll be more attractive to work with.”
Bleich’s comments come at a critical moment for Anthropic, which sued federal agencies this week after the Trump administration effectively blacklisted it following the collapse of contract negotiations with the Department of Defense.
In the lawsuit, Anthropic is represented by WilmerHale, one of the law firms that Trump targeted last year with an executive order that was quickly blocked by a federal judge.
“I like firms that show some spine,” Bleich said following the panel, when asked about using law firms that fought back against Trump’s executive orders targeting them. He declined to comment on the lawsuit itself.
WilmerHale is distinguished in another way: Reginald Heber Smith, who in the early 20th century managed the Big Law firm — then called Hale and Dorr — is widely credited with inventing the billable hour.
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