DoNotPay, one of the first AI companies targeted by the Federal Trade Commission (FTC) for misleading consumers, was marketed as "the world's first robot lawyer, " claiming to have the capability to "sue anyone at the click of a button. " On Wednesday, the FTC announced it had taken action against DoNotPay to put an end to these false claims after discovering that the AI startup had not conducted any testing to assess whether the outputs from its AI chatbot matched the competence of a human lawyer. Moreover, DoNotPay had not employed or consulted any attorneys to verify the accuracy of its AI outputs or endorse the legal assertions made by the company. While DoNotPay did not accept responsibility, it reached a settlement concerning the FTC's claims of violating the FTC Act, agreeing to pay $193, 000 contingent upon the FTC’s consent agreement being ratified after a 30-day public comment period. Furthermore, DoNotPay committed to inform "consumers who subscribed to the service between 2021 and 2023" about the "limitations of law-related features" offered by the service, according to the FTC. Looking to the future, under the terms of the settlement, DoNotPay is also prohibited from making unsubstantiated claims that its features can replace any professional services. A spokesperson for DoNotPay stated to Ars that the company is "pleased to have worked constructively with the FTC to settle this case and address these issues without admitting liability. " The spokesperson added, "The complaint concerns the usage by a few hundred customers some years back (out of millions), related to services that are no longer available. " This settlement with DoNotPay is part of the FTC's broader initiative to combat deceptive practices in the AI industry. The FTC reported that four other AI companies faced enforcement actions on the same day, and FTC Chair Lina Khan noted that the agency's "Operation AI Comply" will continue to scrutinize corporate attempts to "lure consumers into false schemes" or use AI tools to amplify deception. “Using AI tools to deceive or defraud people is illegal, ” Khan stated.

“The FTC's enforcement actions underscore that no AI entity is exempt from existing laws. By targeting unfair or misleading practices within these sectors, the FTC ensures that honest businesses and innovators have a fair opportunity while safeguarding consumers. ” No Testing Conducted for Robot Lawyer Claims DoNotPay was launched in 2015 as a free option for contesting parking tickets. It rapidly expanded to provide services across 200 legal areas, assisting with issues ranging from breach of contract claims to restraining orders, insurance claims, and divorce settlements. As DoNotPay broadened its legal offerings, the company defended its groundbreaking approach to replacing lawyers, though it recognized potential vulnerabilities. In a 2018 statement to the ABA Journal, DoNotPay CEO Joshua Browder acknowledged that such legal services were offered "without lawyer oversight, " but he expressed only limited concern about possible lawsuits for unauthorized legal practice, reasoning that being free would likely help mitigate some of the legal risks.