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What In-House Counsel Should Consider Regarding the Growing Use of AI

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In 1981, IBM introduced its first personal computer (PC), revolutionizing industries worldwide, including the legal industry. Before the IBM PC, law firms relied on typewriters, dictation machines, and physical libraries for research. Like the adoption of innovative technologies, the adoption of PCs in the legal industry was slow, with some attorneys raising ethical and reliability concerns related to the innovative technology. As PC’s matured, however, the legal industry embraced the competitive edge in efficiency, cost savings, and accuracy by using the PC as a tool in the practice of law.

Today’s newest innovation, Artificial Intelligence (AI), is on a similar course. Just as IBM’s PC was adopted as a new tool in the practice of law, AI is and will continue to become a new tool in the practice of law. AI is poised to change workflows, efficiency, accuracy, and provide cost savings. Today, AI can provide a competitive advantage not just for practicing attorneys but also for the clients they serve. This innovation also comes with some caution which in-house counsel should consider collaborating with their outside counsel to navigate.

  1. How Outside Counsel is Using AI – The New PC

When the PC became a tool for practicing attorneys, the use of the PC was basic: word processing, spreadsheets, and legal database searches. The use of PCs todays is more advanced—remote logins, employee tracking, etc. AI is following a similar path, with the potential of becoming an integrated part of daily work for legal professionals. AI is now advertised as having capabilities of writing and analyzing documents, among other generative functions (e.g., generating a case outline or timeline, etc.). This technology, however, is still evolving. Accordingly, in-house counsel should collaborate with outside counsel to consider best uses, advantages, and possible pitfalls with using more advanced, generative, AI.

  1. Confidentiality and Data Security – Lessons from the First Digital Files

Outside counsel should collaborate with in-house counsel to understand how AI is using and storing client documents and other client-confidential data.  (ABA Rule 1.6(c) (“A lawyer shall make reasonable efforts to prevent the inadvertent or unauthorized disclosure of, or unauthorized access to, information relating to the representation of a client.”).)  For example, AI litigations are providing public insight into how AI Large Language Models (LLMs) allegedly rely on certain documents and information to “train.”  See e.g., The New York Times Company v. Microsoft Corporation, 1:23-cv-11195, slip op. at 8 (S.D.N.Y. Apr. 4, 2025) (“[T]he collection stage (also known as the pre-training stage) involves collecting and storing a vast amount of content scraped from the internet, including content scraped from plaintiffs’ websites, and creating datasets from that content which are later used to train the LLMs.”). These litigations highlight concerns about instances wherein it may be unclear where documents and information are stored during training and/or used. Such unknowns may present risks to confidentiality and ownership of documents and information.

Concerns like this, however, are not new. Similar concerns—where and how data or information is being stored and accessed—were also present at the dawn of PCs being used by attorneys. The solution then and now is collaboration between in-house and outside counsel so both sides understand data security protocols for AI tools, such as where and how client-confidential data is stored, accessed, and used.

Since 1981, technology has continued to shape industries worldwide, including the legal industry.  AI is yet another leap in technology that has the potential as a tool to reshape the practice of law. Today, collaboration between in-house and outside counsel on the use of AI has the potential to mitigate challenges but also to change workflows, efficiency, accuracy, and provide cost savings—a competitive advantage for outside counsel and in-house counsel’s corporate client.