Latham and Watkins buys Nvidia servers to set up in-house AI systems (www.ft.com)

Latham & Watkins, the second-largest law firm in the U.S., has made a bold move into the AI space by purchasing Nvidia GPU servers to create customized AI systems in-house. This significant investment marks a departure from the typical practice of law firms that have largely relied on existing AI software and cloud services. By operating its own servers, Latham can maintain strict control over sensitive client data, as stated by CIO Rene Mendoza, who emphasized the importance of protecting proprietary information without relying on external cloud vendors. The firm is leveraging open-weight AI models, specifically tailoring Nvidia's Nemotron 3 models to meet its unique needs, which is a strategy closely aligned with tech companies rather than traditional legal firms. This initiative highlights a broader shift in the legal industry as firms recognize the necessity of integrating AI to enhance productivity and stay competitive amid pressures from clients for reduced fees. Latham’s approach not only provides flexibility in managing AI-related costs but also diversifies its capability by allowing lawyers to utilize both proprietary models and commercially available tools. The move signals a potential paradigm shift in Big Law, demonstrating that firms can no longer afford to overlook the transformative impact of AI, especially as costs and dependencies on external providers grow.