I've never done work for a law firm but have talked to some and the small shops specializing in easy cases like DUI's and personal bankruptcies can pretty easil

I've never done work for a law firm but have talked to some and the small shops specializing in easy cases like DUI's and personal bankruptcies can pretty easily fill up their billable hours by turning an AdSense campaign on and not coming close to eating away their margin. I'd guess on the keywords where law firms are spending hundreds per click, you're dealing with malpractice and personal injury cases. Those cases are likely to be done on contingent and can have pretty huge upsides. I'd think a well-run firm would have some idea of the expected value of those types of cases and can spend accordingly to acquire clients. Considering how targeted search ads are compared to how these firms normally advertise -- local TV, radio, billboards, busses, etc. the costs probably aren't radically different than they're used to spending on advertising.