It is a lossy compressed index. It has an approximate knowledge of law, and that approximation can be pretty good - but it doesn't know when it's outputting plausible but made-up claims. As with GitHub Copilot, it's probably going to be a mixed bag until we can overcome that, because spotting subtle but grave errors can be harder than writing something from scratch.

There's already a fair number of stories of LLMs used by an attorney messing up court filings - e.g., inventing fake case law.