Corporate Legal Leaders Warn AI Risks Are Escalating Even as In-House Teams Accelerate Adoption — Baker Botts Managing Partner Predicts Associate Layoffs at Rival Firms

A new survey of corporate legal leaders by Litera, reported by Law360, finds that concerns about the risks of artificial intelligence are rising sharply even as in-house legal departments deepen their use of AI tools, creating a tension between technology adoption and governance readiness. The survey captures a moment at which legal AI has moved from pilot projects to operational deployment in many large corporate law departments, but risk frameworks — covering data confidentiality, output verification, liability allocation, and regulatory compliance — have not kept pace. Separately, Baker Botts managing partner Danny David has made a pointed public prediction: that AI will trigger associate-level layoffs at some large law firms, though he insisted his firm would not be among them. David's reasoning distinguished between firms whose profitability depends on associate volume billing hours on routine tasks — which he argued are directly exposed to AI displacement — and firms, like Baker Botts, whose model is built on specialised expertise and judgment on complex matters where clients pay for quality rather than hours. The comments, given to Bloomberg Law, reflect a growing bifurcation in how Biglaw firms are publicly positioning their AI strategies: some emphasising productivity gains and retained headcount, others implicitly acknowledging that the economic case for large associate cohorts weakens as AI automates routine legal work. David also stated that AI is "the single best development for the careers of the next generation that has ever visited the Earth," arguing it has already enhanced associate career prospects by freeing them from lower-value tasks.