The Federal Trade Commission has recently taken action against one of the earliest AI firms, DoNotPay, originally marketed as “the world’s first robot lawyer” capable of “suing anyone with just a click.” This AI company was said to allow users to file lawsuits easily, but it has come under scrutiny for misleading claims.
This Wednesday, the FTC disclosed that it intervened to halt DoNotPay from continuing to issue deceptive statements after discovering the company had not conducted any tests to compare its AI chatbot’s responses to those of a human lawyer. Furthermore, DoNotPay had not employed any legal professionals to assess the accuracy of the AI’s outputs or to confirm the validity of its legal assertions.
Although DoNotPay did not accept responsibility, it agreed to settle the allegations of violating the FTC Act by paying $193,000, pending the approval of the FTC’s consent agreement after a 30-day period for public commentary. The company also committed to notifying “consumers who subscribed to the service from 2021 to 2023” about the “restrictions of the law-related features of the service,” according to the FTC.
Under the terms of the settlement, going forward, DoNotPay will be barred from falsely claiming that its features could replace professional services.
A representative from DoNotPay informed Ars that the firm “is happy to have constructively worked with the FTC to settle this matter and fully address these issues, without admitting any liability.”
The representative explained, “The complaint pertained to the use of a few hundred customers several years ago (out of millions), involving services that have since been phased out.”
The FTC’s agreement with DoNotPay is merely a piece of a broader initiative to target fraudulent AI claims. On the same day, the FTC enforced actions against four other AI companies, and FTC Chair Lina Khan emphasized that the agency’s “Operation AI Comply” would persist in overseeing firms that employ AI tools to “entice consumers into sham deals” or to “enhance deceptive practices.”
“It’s illegal to use AI tools to deceive, mislead, or defraud individuals,” Khan stated. “The FTC’s enforcement actions reinforce that AI is not exempt from existing laws. By targeting these unfair or deceptive practices, the FTC is safeguarding honest businesses and innovators, ensuring they can compete fairly and that consumers are protected.”
DoNotPay’s Lack of Testing on Its ‘Robot Lawyer’
Launched in 2015, DoNotPay began as a free service for challenging parking tickets and soon claimed to handle over 200 legal areas—from breach of contract and restraining orders to insurance disputes and divorce proceedings.
As the scope of DoNotPay’s legal services widened, the company touted its approach of substituting traditional legal services with AI, despite admitting the precarious nature of its operations. In a 2018 interview with the ABA Journal, DoNotPay’s CEO Joshua Browder acknowledged the absence of legal supervision over the services offered, mentioning only slight concerns about potential legal repercussions for practicing law without a license. Browder believed that since DoNotPay was a free service, it might sidestep some legal hurdles.
However, as per the FTC’s filing, by 2019, DoNotPay began charging users $36 bi-monthly and made several misleading claims in its advertisements aimed at boosting subscription numbers.
I am Sofia, a tech-savvy journalist and passionate member of the “Jason Deegan” team. Growing up, I was always fascinated by the latest technological advancements and loved sharing my knowledge with others.