DoNotPay Has To Pay, After FTC Dings It For Lying About Its Non-Existent AI Lawyer

Remember “DoNotPay”? They were the company, run by Joshua Browder, claiming to be the “world’s first robot lawyer.” There were all sorts of sketchy things going on, some of which dated back to “DoNotPay’s” earliest days. But things really came to a head last year when legal investigator extraordinaire, Kathryn Tewson, started digging in and finding an awful lot of questionable things going on.

In May of last year, we noted that the FTC had put out a notice which we interpreted as directly targeted at DoNotPay’s myriad false and misleading claims. It looks like we were right.

On Wednesday, the FTC announced actions taken against five different companies making misleading claims about AI, including DoNotPay.

An FTC complaint claims U.K.-based DoNotPay told people its online subscription service acts as “the world’s first robot lawyer” and an “AI lawyer” by using a chatbot to prepare “ironclad” documents for the U.S. legal system. The complaint also says DoNotPay told small businesses its service could check their websites for law violations and help them avoid significant legal fees. In fact, according to the complaint, DoNotPay’s service didn’t live up to the hype. You’ll have 30 days to comment on a proposed settlement between FTC and DoNotPay, which requires DoNotPay to stop misleading people, pay $193,000, and tell certain subscribers about the case.

The details of the complaint are pretty damning.

Respondent described the Service as “the world’s first robot lawyer” and an “AI lawyer” capable of performing legal services such as drafting “ironclad” demand letters, contracts, complaints for small claims court, challenging speeding tickets, and appealing parking tickets. Through a chatbot, subscribers would submit prompts or queries to an AI “robot lawyer” that purportedly operated like a human lawyer, including by applying the relevant laws to subscribers’ particular legal and factual situations; relying on legal expertise and knowledge to avoid potential complications, such as statutes of limitations, compensation limits, and jurisdiction, when generating legal demand letters or initiating cases in small claims court; and detecting legal violations on subscribers’ business websites and providing advice about how to fix them. In fact, the DoNotPay Service was not designed to operate like a human lawyer in these respects.

The complaint confirms basically everything that Tewson reported, and based on the timing of the investigation, it sure looks like the FTC was inspired by Tewson’s work.

They also point out that, beyond just misrepresenting the whole “AI lawyer” thing, Browder and DoNotPay inflated a user-generated comment on a site for kids that the LA Times ran as an LA Times review of the service. Really.

The donotpay.com website has prominently featured a quote that purports to come from The Los Angeles Times newspaper and states, “What this robot lawyer can do is astonishingly similar – if not more – to what human lawyers do.” Compl. Exh. F.

In fact, the foregoing quote derives from a high-schooler’s opinion piece in the Los Angeles Times’ High School Insider website, a user-generated content platform for young people.

I dunno, but it sure feels like Joshua Browder has a problem with being honest.

The complaint goes on to detail a whole bunch of claims DoNotPay made about legal services its system could offer, including suggesting it was specialized in legal expertise and could help you avoid having to hire a lawyer. But, the FTC notes:

DoNotPay did not test whether the Service’s law-related features operated like a human lawyer. DoNotPay has developed the Service based on technologies that included a natural language processing model for recognizing statistical relationships between words, chatbot software for conversing with users, and an Application Programming Interface (“API”) with OpenAI’s ChatGPT. None of the Service’s technologies has been trained on a comprehensive and current corpus of federal and state laws, regulations, and judicial decisions or on the application of those laws to fact patterns. DoNotPay employees have not tested the quality and accuracy of the legal documents and advice generated by most of the Service’s law-related features. DoNotPay has not employed attorneys and has not retained attorneys, let alone attorneys with the relevant legal expertise, to test the quality and accuracy of the Service’s law-related features.

That all seems a bit important? Maybe?

Then there’s the “diagnostic feature” that DoNotPay offered, where it said it would scan your business website and see if you violated any federal or state laws based on your email address. But, as the FTC notes:

DoNotPay’s website diagnostic tool did not, in fact, analyze a consumer’s small business website for hundreds of federal and state law violations based solely on an email address.

Also, apparently the State Bar of California had investigated DoNotPay in late 2021 and accused it of unauthorized practice of law. According to the complaint, Browder agreed to change their marketing behavior:

On or about January 21, 2022, the Chief Executive Officer for DoNotPay promised the California Bar that DoNotPay would no longer represent that the DoNotPay Service was the world’s first robot lawyer

Take a wild guess how that went?

Nevertheless, DoNotPay continued to make this representation.

On June 15, 2023, the California Bar sent a cease-and-desist notice alleging the DoNotPay Service amounted to engagement in the unauthorized practice of law. On the same day, Respondent affirmed that it had removed: a) all mentions of “robot lawyer” from the DoNotPay website and related social media; b) all products on the DoNotPay website that allowed consumers to generate legal documents; and c) any mention of “sue anyone” from the DoNotPay website. Notwithstanding these representations to the California Bar, the DoNotPay website and social media account continued to promote the Service as the “World’s First Robot Lawyer” and advertise “sue anyone” claims

Still, having to pay $193,000 seems like small potatoes for a company that has raised over $25 million from some big names like Andreessen Horowitz and DST Global (oh and convict Sam Bankman-Fried).

The company does have to alert a bunch of users to this settlement as well which might reasonably cause customers to think twice about doing business with such a problematic company.

But also, the settlement includes a consent order, which says DoNotPay cannot keep misrepresenting its products. And this is often how companies get into serious trouble with the FTC. First they do something bad and get a slap on the wrist that contains a consent decree. And then they violate the consent decree. At that point the FTC can come down on them hard.

Anyway, the company is no longer pitching itself as an AI robot lawyer, but rather your “AI consumer champion.”

Would you trust a company that just got rung up for lying to the public by the FTC about its AI capabilities to be your “AI consumer champion”? I wouldn’t.