Federal Trade Commission — DoNotPay
The FTC finalized an order against DoNotPay, prohibiting the company from making deceptive claims about its 'AI Lawyer' service and requiring it to pay $193,000 in monetary relief.
Key takeaway — how to prevent this
AI that denies insurance claims or benefits must preserve meaningful human review of medical necessity; automated mass denials draw bad-faith, breach-of-contract and class-action liability.
Case brief
Read from the source document on 2026-09-06. Every holding carries a short verbatim quote from that text.
- Decided by
- Federal Trade Commission
- Parties
- Federal Trade Commission v. DoNotPay
- Decision date
- January 17, 2025
- Remedy
- DoNotPay agreed to pay $193,000, notify past subscribers who joined between 2021 and 2023 about limitations, and refrain from making unsubstantiated claims about substituting for professional services.
- Amount
- $193,000
- Appeal
- Appeal status not stated
Key holdings
DoNotPay agreed to a settlement order with the FTC to resolve charges over deceptive claims regarding its AI lawyer service.
“DoNotPay has agreed to a proposed Commission order settling the charges against it.” — Case Summary
The settlement requires DoNotPay to pay $193,000 and send warning notices to consumers who subscribed between 2021 and 2023.
“The settlement would require it to pay $193,000, provide a notice to consumers who subscribed to the service between 2021 and 2023 warning them about the limitations” — Case Summary
The FTC order prohibits DoNotPay from claiming it can substitute for professional services without proper supporting evidence.
“prohibit the company from making claims about its ability to substitute for any professional service without evidence to back it up.” — Case Summary
In plain English
The Federal Trade Commission took action against DoNotPay, a company that marketed an artificial intelligence service as the world's first robot lawyer. According to the FTC, the service failed to live up to claims that it could serve as a substitute for a human attorney's legal expertise. To resolve the charges, DoNotPay agreed to a settlement with the Commission. Under the terms of the settlement, DoNotPay must pay $193,000 and issue a warning notice to consumers who subscribed to its service between 2021 and 2023, informing them about the limitations of its legal features. Furthermore, the FTC's order prohibits DoNotPay from making deceptive claims about its AI chatbot or asserting that its service can substitute for any professional service without having sufficient evidence to back up those claims. The Commission finalized the order in January 2025, concluding the action against the company for its misleading marketing claims regarding its automated law services.
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