By Mr. Sris, Founder, CEO & Principal Attorney, Law Offices Of SRIS, P.C.
As artificial intelligence becomes deeply integrated into daily business operations, founders and executives are using it to draft emails, analyze data, and brainstorm strategies. But there is a massive legal risk many businesses are completely ignoring: using AI to analyze your legal disputes.
If you are treating an AI chatbot as a sounding board for your legal issues, you might accidentally be creating evidence for the opposing side.
The Federal Court Reality Check
A federal court recently made something very clear: using AI to analyze your legal situation does not create privilege.
In a recent dispute, a party used AI to evaluate their claims and generate written material about their case. When discovery rolled around, they tried to argue that those AI-generated communications were protected under attorney-client privilege and the work product doctrine.
The court completely disagreed and required the production of those materials. The other side got to see exactly what they were thinking.
Why AI Breaks Attorney-Client Privilege
To understand why this happens, you have to understand that legal privilege is narrow and specific.
Attorney-client privilege only applies when there is a confidential communication between a client and a lawyer for the purpose of seeking legal advice. Here is the problem: AI is not a lawyer. When you type sensitive information into an AI prompt, you are introducing a third party (the AI platform) into the conversation. Sharing information with a third party inherently waives your privilege, even if you did not intend to give anything up.
The “After the Fact” Fallacy and Work Product
Many business owners mistakenly believe they can “cure” this issue by simply sending the AI’s output to their corporate counsel. This does not work.
- No Retroactive Privilege: Sending AI-generated content to your attorney later does not make the original interaction with the AI protected.
- The Work Product Doctrine Fails: The work product doctrine protects materials prepared in anticipation of litigation. However, these materials must be created by or at the direction of counsel. Independent AI use by a business owner or employee does not meet that strict standard.
The Bottom Line
The takeaway is simple, but critical for protecting your business: If you are using AI to think through your case, you may be creating evidence for the other side. While AI is a phenomenal tool for general business productivity, it has absolutely no place in your confidential legal planning. Use AI carefully, and ensure that when it comes to legal matters, your strategy stays securely between you and your attorney.