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Welcome to this week's edition of The Legal Wire!

Media vs. models, courts vs. copycats, and record legal-AI funding, this week drew the battle lines. The New York Times sued Perplexity for allegedly scraping and regurgitating paywalled reporting, signaling tougher publisher pushback. UNESCO issued global guidelines for courts using AI, human oversight, audits, and rights safeguards, to stem a flood of dodgy, machine-written filings. On the business front, Harvey raised $160M at an $8B valuation as adoption spreads across Am Law and Fortune legal teams. Meanwhile, Fastcase (Clio) sued rival Alexi over alleged data misuse, and LexisNexis swatted away blame for fake citations in the Fat Joe case.

Plus: we go inside Avokaado’s new “Avo”, governed agents built to fix legal’s real bottleneck: validation, not drafting.

This week’s Highlights:

• Industry News and Updates

• Governed AI for Legal: Avokaado Launches Avo to Solve the Validation Bottleneck

• AI Regulation Updates

• AI Tools to Supercharge your productivity

• Legal prompt of the week

• Latest AI Incidents & Legal Tech Map

➡️ New York Times Sues Perplexity AI for Allegedly Using Its Journalism Without Permission | The New York Times has filed a lawsuit accusing Perplexity AI of illegally copying and delivering Times journalism to users through retrieval-augmented generation, including content taken from behind its paywall. The Times says it repeatedly asked Perplexity to stop the unlicensed use of its reporting and vows to hold AI companies accountable for exploiting its work without compensation.
^{Dec 5, 2025, Source: NYTCO}

➡️ Harvey Raises $160M at $8B Valuation in Round Led by Andreessen Horowitz | Legal AI platform Harvey has secured $160 million in new funding at an $8 billion valuation, led by Andreessen Horowitz with participation from WndrCo, T. Rowe Price–advised accounts, and returning backers including Sequoia and Kleiner Perkins. The company will launch its first tender offer as it continues rapid growth, now used by more than 50% of Am Law 100 firms and major in-house teams such as Bridgewater, Comcast, and Carvana.
^{Dec 4, 2025, Source: Harvey}

➡️ LexisNexis Pushes Back After Lawyer Blames Fake Citations in Fat Joe Case on AI Tool | In the ongoing civil case against rapper Fat Joe, attorney Tyrone Blackburn is under fire after citing non-existent cases in a brief—and blaming the errors on a LexisNexis AI feature. LexisNexis responded in court filings, saying Blackburn wasn’t even an authorized user of its AI tools and rejecting any responsibility for the mistakes. The dispute comes as Blackburn faces separate legal trouble, including an indictment over allegedly injuring a process server.
^{Dec 3, 2025, Source: TMZ}

➡️ UNESCO Issues Global Guidelines to Govern AI Use in Courts and Tribunals | UNESCO has released new global guidelines to help courts adopt AI responsibly, offering 15 principles on human oversight, auditability and rights protection amid rising misuse of AI-generated legal submissions. With judicial systems facing massive backlogs and uneven AI adoption, the guidelines aim to ensure AI enhances, rather than undermines, human-led justice.
^{Dec 3, 2025, Source: UNESCO}

➡️ Fastcase (Clio) Sues Rival Alexi Over Alleged Data Misuse and AI Training Violations | Clio-owned Fastcase has filed a federal lawsuit accusing competitor Alexi of breaching a licensing deal by training AI models on Fastcase’s law library, displaying its case law to users, and using its trademarks, allegations Alexi denies. Fastcase seeks an injunction, destruction of derived datasets and model weights, and damages as the companies increasingly compete in the legal research market.
^{Nov 28, 2025, Source: Reuters}

Legal Technology

Governed AI for Legal: Avokaado Launches Avo to Solve the Validation Bottleneck

Legal AI tools have gotten very good at generating text. They can draft an NDA in seconds and summarize a contract with one click. But here’s the problem: drafting was never the bottleneck.

The real time sink in legal work is validation. Checking compliance, verifying risk alignment, ensuring every clause matches policy, and tracking decisions across redlines and review cycles. That’s where hours disappear, and where most AI tools don’t place their focus. They generate fast, but they can’t always prove their work. An issue that we’ve seen increasingly rearing its head in discussions is that legal teams are left re-checking everything anyway, often spending more time validating AI output than they would have drafting from scratch.

Avokaado has spent nearly a decade building contract intelligence infrastructure, treating contracts as structured data and not static files. Now, with the launch of Avo, they’re applying that foundation to solve what CEO Mariana Hagström calls “the black box problem” of generative AI.

It’s what Avokaado calls an “AI playbook engine”, a system of governed agents that operate within defined rules, escalate when needed, and produce auditable decisions through something called the 5D Engine™. The promise? Legal teams can finally productize their expertise: building autonomous assistants that handle entire contract lifecycles without guessing, hallucinating, or creating more work.

We met with Mariana to understand how Avo actually works, why validation matters more than generation, and whether this marks the shift from contract intelligence to true operational intelligence.

Click here to continue reading the full interview

The AI Regulation Tracker offers a clickable global map that gives you instant snapshots of how each country is handling AI laws, along with the most recent policy developments.

The most recent developments from the past week:

📋 9 December 2025 | President Trump to issue order creating national AI rule: In his post on Truth Social, US President Donald Trump said he would sign an executive order this week that would create a single national rule for AI, which the industry has said is necessary to override disparate laws passed by US states - "There must be only One Rulebook if we are going to continue to lead in AI... I will be doing a ONE RULE Executive Order this week. You can’t expect a company to get 50 Approvals every time they want to do something," wrote President Trump. President Trump did not provide details, though last month it was reported that the president was considering an executive order that would seek to preempt state laws on AI through lawsuits and by withholding federal funding.

📋 3 December 2025 | AI chatbots face major crackdown in UK as Tech Secretary warns of new law: It is reported that AI chatbots will face a major crackdown in UK amid growing concerns they are not covered by the law, said the Technology Secretary when giving evidence to the Science, Innovation and Technology Committee. Secretary Kendell admitted the Online Safety Act does not cover AI chatbots after tasking her officials with finding gaps in the law, and called on Ofcom to take immediate action to protect children from AI chatbot dangers, using its existing regulatory powers under the Online Safety Act (noting that amendments have already been introduced to the Crime and Policing Bill to criminalise the use of AI to create child sexual abuse material).

📋 3 December 2025 | Withdrawal of AI Liability Directive won't face challenge by EU lawmakers: It is reported than an overwhelming majority of lawmakers on the European Parliament's Legal Affairs Committee vote to decline a motion to sue the European Commission over its withdrawal of a legislative proposal for an AI Liability Directive. The committee's vote likely ends the proposal for the AI Liability Directive for good.

🆕 Expert Radar - Gives you an in-depth analysis of an expert’s litigation history, helping you identify conflicting testimony, potential biases, and questionable credentials.

🆕 Juro - Empower your team to agree and manage contracts end-to-end, with flexible AI automation that lives where you live.

🆕 Jurimesh - The Legal Due Diligence Platform Dealmakers Trust

Want more Legal AI Tools? Check out our
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The Responsible AI Collaborative is a not‑for‑profit organization working to present real‑world AI harms through its Artificial Intelligence Incident Database.

View the latest reported incidents below:

⚠️ 2025-10-27 | Alleged Fabricated News Sites and Deepfakes Impersonated Maltese Ministers, Financial Experts, and Media to Promote NethertoxAGENT Fraud | View Incident

⚠️ 2025-10-27 | Purported Deepfake Video and Fake News Articles Allegedly Used to Impersonate Guernsey's Chief Minister in Investment Scam | View Incident

⚠️ 2025-05-29 | Purportedly AI-Assisted Citation Errors Allegedly Found in Newfoundland and Labrador's 2025 Health Workforce Report by Deloitte | View Incident

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