AI disruption fears just hit the legal world hard. After Anthropic rolled out a legal-focused plug-in for its Claude Cowork platform, shares of major legal software and publishing companies tumbled as investors worried AI could start eating into their core businesses.
The selloff highlights how quickly new AI features can shake entire sectors.
Claude Just Got a Law Degree
Anthropic’s new plug-ins, available to paying Claude Cowork users, include one designed specifically for legal work. It can review documents, flag risks, and track compliance, tasks that traditionally keep lawyers and legal research platforms busy.
That was enough to spark heavy premarket losses in RELX $RELX ( ▼ 14.13% ) , which owns LexisNexis, Thomson Reuters $TRI, which owns Westlaw, and LegalZoom $LZ ( ▼ 19.68% ) . Investors appear to be pricing in the risk that AI tools could automate parts of legal research, drafting, and analysis.
RELX and Thomson Reuters may have a slight edge because of their deep proprietary databases, which AI models still rely on. LegalZoom, which provides more direct legal services, could face more direct pressure from low-cost AI alternatives.
AI Shockwaves Hit Software More Broadly
The legal plug-in was not the only new feature. Anthropic also launched tools for productivity, enterprise search, sales, finance, marketing, customer support, and even biology research, plus a meta plug-in to help users build their own.
That broader wave of capabilities may help explain why the iShares Expanded Tech Software ETF $IGV ( ▼ 4.61% ) has been under pressure as well, as investors reassess how many traditional software tools could be replaced or reshaped by AI copilots.
AI is no longer just a coding assistant. It is moving into high-margin professional services, and markets are reacting fast.
From Curiosity to Real-World Use
This is not just theoretical. Reports have already surfaced of legal professionals and individuals using AI tools to analyze documents and draft legal correspondence. Even high-profile figures like short seller Andrew Left have reportedly turned to Claude for help with legal materials.
When AI starts showing up in real cases and real workflows, the competitive threat stops being hype and starts being a line item risk.