Can a Law Firm License Its Data for AI Training?

Short answer: some law firms can, but only for the right kind of records, only with client information kept out, and only after the firm’s own counsel has reviewed the terms. This article explains what “licensing data for AI training” actually means, what buyers tend to look for from a law firm, and the questions to answer before anything leaves your office.

It is general information, not legal advice. Your firm’s ethics obligations, engagement letters and state rules come first.

What “licensing” means here

AI systems learn from examples. For years, AI teams learned mostly from public web pages. Many are now looking for something the open web cannot give them: the everyday records that real businesses create while they run.

Licensing means you give a buyer permission to use a copy of agreed data, for a set purpose, for a set time, under written rules. You are not selling your firm. You are not handing over your clients. In most arrangements the firm keeps its own copy and keeps using it, and the contract should say so in plain words.

What a buyer might want from a law firm

Buyers want records that show how real work gets done. For law and accounting firms, the examples in our free guide are:

• Your own templates and forms the firm created
• Process records, such as how a matter moves from intake to close
• Billing workflows and the steps behind them
• Review steps and internal checklists

The point is not what a specific client said or did. It is how professional work is organized. Client information stays out.

Not every firm, and not every record type, will find a buyer. Demand changes from buyer to buyer, and a good partner should tell you plainly whether there may be interest before you spend time on it.

What stays out: client confidences

For lawyers, this is the heart of the question. ABA Model Rule 1.6 says a lawyer shall not reveal information relating to the representation of a client unless the client gives informed consent, the disclosure is impliedly authorized, or an exception applies. Paragraph (c) adds that lawyers must make reasonable efforts to prevent inadvertent or unauthorized disclosure of, or access to, that information. (ABA Model Rule 1.6)

The ABA’s 2024 opinion on generative AI tools is also worth reading. It is about lawyers using AI tools rather than licensing records, but it makes related points: lawyers should understand the terms, privacy policy and data practices of any AI provider, and should evaluate the risk that information relating to a representation could be disclosed or accessed by others. (ABA Formal Opinion 512, July 29, 2024)

That is why the conversation for a law firm starts with the firm’s own operational knowledge, not with client files. Your state’s rules may differ from the Model Rules, so have your own ethics counsel decide what, if anything, is appropriate.

Six questions to settle first

Our guide uses a six-point checklist. Every point is easier to fix before a contract is signed than after.

1. Who owns it? Check contracts with clients, vendors and software providers. Owning the server is not the same as owning the right to license what is on it.
2. Is anyone identifiable? Names, addresses, phone numbers, emails and ID numbers must be removed or left out. If you are not sure, leave it out.
3. Is it really clean? Look for hidden fields, free-text notes and attachments. Personal details hide in odd places.
4. Do your promises allow it? Read your engagement letters, privacy notices and client agreements. If they do not cover licensing, stop and ask your attorney.
5. What exactly is the license? How long? For what use? Exclusive or not? Can the buyer resell? Can you still use your own data? Get every answer in writing.
6. Can you stay in control? You choose what is shared. You should have a way to ask questions, check use, and end the deal if terms are broken.

How the process usually works

The path is simple to describe, even if each step needs care:

1. Apply. The firm tells a buyer, or a referral partner, what kinds of records it keeps.
2. Review call. A short conversation about what you have and whether there may be interest.
3. Agree on terms. Offers come back with terms. You and your lawyer compare them and decide whether to say yes.
4. Approve the cleaned data. Names and private details are removed first. You approve the result before anything moves.
5. Get paid. Payment comes from the buyer under the written terms.

Saying no is always an option, at any point.

What about cost and value?

It is free for the business; the buyer pays. You do not buy software or a subscription to find out whether there is interest.

As for value: no honest person can give you a number before looking at your data. Value depends on the type, size, quality and uniqueness of the records, and on buyer demand. Ask for offers in writing after a review, and compare more than the headline price.

Is my firm big enough?

Many programs set a minimum, because buyers want enough data to be useful. As a rough guide today, law firms with about 10 or more people tend to be a better fit, and years of records your firm owns help. A short, free check will tell you where you stand.

The bottom line

A law firm can sometimes license its own operational knowledge, such as templates, process records and workflows, for AI training. Client confidences are a different matter and stay out. The firm decides what is shared, its own counsel reviews the terms, and nothing moves until the firm approves the cleaned data.

If you want to go deeper, get the free guide or book a free 20-minute call. You can also read Is it safe to share firm data with AI companies? for a longer confidentiality checklist.