Latham & Watkins, the second-largest law firm in the United States by revenue, has purchased its own Nvidia GPU servers and begun customizing artificial intelligence models, signaling a notable shift in how major law firms incorporate AI technology. With reported revenue of $8.3 billion last year, the firm’s move underscores the growing impact of AI on the legal industry’s business model.
The firm has acquired multiple servers, each equipped with several GPUs—specialized chips designed to run AI applications efficiently. By operating its own hardware, Latham assumes full responsibility for cybersecurity and server management, enabling the firm to keep clients’ sensitive data fully within its own infrastructure. Rene Mendosa, Latham’s chief information officer, emphasized the importance of protecting highly sensitive client information without relying on cloud vendors. He also noted that given the rising costs associated with AI consumption pricing, having direct control over the technology provides greater flexibility.
AI is transforming legal work, which often involves handling massive amounts of data and performing repetitive tasks. Driven by advances in technology, financial clients such as Wall Street banks are increasingly pressuring law firms to reduce fees by accelerating these processes. However, many law firms have traditionally hesitated to undertake significant upfront investments in AI infrastructure due to the impact on short-term profits distributed to equity partners. Consequently, most have opted to subscribe to AI software and cloud-based services rather than building proprietary systems.
Latham’s decision to invest heavily in its own AI hardware and refine open-source AI models internally marks a departure from this norm. The firm’s internal team of machine learning and software engineers is actively customizing Nvidia’s Nemotron open-weight AI models to suit legal applications. Joy Heath Rush, CEO of the International Legal Technology Association, described this approach as unprecedented in the legal sector.
This strategy contrasts with other leading law firms. Kirkland & Ellis is collaborating with Palantir to develop AI tools, while Allen & Overy and Shearman & Sterling have partnered with the legal tech start-up Harvey. Freshfields recently announced a collaboration with Anthropic. Latham continues to use AI products and services from major technology companies alongside its internal development efforts.
Latham declined to disclose the total amount invested in this initiative, which has been underway for several years. Industry insiders estimate that the costs of purchasing and maintaining GPU servers at this scale, along with employing the necessary technical staff to run and secure these systems, can reach tens of millions of dollars annually and may increase substantially as the technology evolves.
The firm leases secured data center space accessible exclusively by its personnel to house the hardware. It currently employs more than 900 technology professionals, underscoring its significant commitment to integrating AI within its legal services.