Freshfields Bruckhaus Deringer is evaluating a potential spinoff of its internal artificial intelligence division. Senior partners suggest that the unit, which creates AI tools for legal professionals and clients, could reach a valuation in the billions of dollars if operated as an independent entity.
Ethan Klingsberg, co-head of U.S. corporate and M&A at the firm, noted that discussions are currently in the preliminary stages. He emphasized that the firm aims to avoid diluting the value of its proprietary technology by keeping it integrated within the broader legal practice. The potential market value for external clients remains unconfirmed.
The legal technology sector has seen significant investment, with funding for startups exceeding $2.4 billion by October 2025. Other industry players have achieved substantial valuations, such as Harvey at $15.5 billion and Legora at $5.6 billion. These figures reflect growing confidence in automation for legal document workflows.
Major technology providers are actively expanding their presence in the legal market. In September, OpenAI introduced an AI foundation for legal firms alongside 26 ecosystem plugins for ChatGPT. Additionally, Anthropic updated Claude in May with over 20 Model Context Protocol connectors and 12 specialized plugins for legal practice areas.
