What happens when the chair of one of the world's most successful law firms walks away from BigLaw to join a venture-backed AI company? In 2026, Mike Schmidtberger, who chaired Sidley Austin's Executive Committee from 2018 to 2025, became Chairman of Norm Law, an AI-native law firm built alongside Norm, the legal and compliance AI company founded by John Nay that is now valued at more than $1 billion. Together they are testing a model that could reshape how legal services are built, priced, and delivered.
In this episode of New Law Order, a limited series and podcast co-hosted by Joel Cohen and Yale Law School Professor John Morley, the founder and the former BigLaw chair explain how a technology company and a law firm can be "as married as they're legally allowed to be," what AI agents actually do on a deal, and why they have abandoned the billable hour.
The Odd Couple
Nay and Schmidtberger were introduced by former Thomson Reuters CEO Tom Glocer, a member of Norm's legal advisory board. Schmidtberger describes visiting Norm's offices, seeing legal engineers and software engineers working side by side, and concluding that Nay was "five years ahead" of where he had hoped to take knowledge management at Sidley. He "failed retirement after 11 days." Nay explains the "full stack" strategy he first used at Brooklyn AI, where he built an SEC-registered investment adviser on top of his own AI platform rather than just selling software, a company later acquired by Nuveen.
Two Companies, One Mission
Because most states bar nonlawyers from owning law firms, Norm Law is a separate New York partnership owned by its lawyers and connected to Norm by contract, with Norm Law paying for use of the technology. The hosts compare it to the management services organization (MSO) structures private equity has used to invest in accounting firms. Nay explains why building the AI and using it every day in the same enterprise creates a feedback loop that a pure software vendor or a traditional firm cannot match, and why selling to in-house teams and running a law firm reinforce rather than undercut each other.
AI Agents on the Deal
Norm's agents review marketing and investor communications against SEC and FINRA rules for clients such as asset managers and insurers. At Norm Law, agents trained on a client's own precedents and playbooks draft the first set of documents while the partner is still on the phone with the client. A full-service, AI-forward firm, Norm Law focuses on sophisticated but repetitive transactional work, from fund formation and venture capital to private equity and real estate, and is not yet doing litigation. Schmidtberger explains how the firm keeps each client's proprietary data and agents segregated, much as any firm handles conflicts and confidentiality.
Beyond the Billable Hour
Norm Law prices by document or transaction, indexed to what clients have historically paid, with no upfront charges and no hourly billing. The guests describe how that alignment changes the firm itself: no up-or-out associate track, associates trained through AI-assisted "simulation" sitting elbow to elbow with partners, partners hired for practice excellence rather than portable books of business, and a firm whose value does not walk out the door when a lawyer leaves. Schmidtberger offers his advice to BigLaw leaders, and Nay describes "supervisory AI," agents that monitor other AI agents for legal and regulatory compliance as AI does more of the economy's work.
What to Know Now
Norm launched Norm Law in November 2025 alongside a $50 million investment from Blackstone, and in July 2026 raised a $120 million Series C led by Khosla Ventures at a $1.2 billion valuation, bringing its total funding to more than a quarter of a billion dollars at the time of taping.
The rules on nonlawyer ownership remain the central constraint on models like this one. ABA Model Rule 5.4 and most states still bar nonlawyers from owning law firms or sharing legal fees. Arizona has licensed alternative business structures since 2021, including KPMG Law US in 2025, and Utah runs a regulatory sandbox, while California in 2025 barred its lawyers from sharing contingency fees with out-of-state alternative business structures. Private equity interest is growing through MSO arrangements that invest in a firm's business operations rather than the practice of law itself. For lawyers using AI agents in their own practices, ABA Formal Opinion 512 (2024) addresses competence, confidentiality, supervision, communication with clients, and fees for work done with generative AI.
