Why Your Legal Department Needs to Get Serious About AI – Now

As a technology law partner who recently completed MIT's AI strategy program, I've watched with growing concern as law firms and legal departments rush to adopt AI tools without fully understanding the risks.

The enthusiasm is understandable. When ChatGPT-4 scored in the 90th percentile on the bar exam, many saw it as validation that AI could transform the practice of law. But my research reveals a more complex reality. Even specialized legal AI tools from industry leaders produce "hallucinations" – confidently presented false information – up to a third of the time. We’ve all heard stories of the consequences, including recent sanctions against attorneys who submitted AI-generated briefs containing fictitious case law.

What concerns me most is how many lawyers lack proper training and tools for handling confidential client information when using AI, potentially exposing sensitive data to competitors and adversaries. As an adviser to clients on technology and privacy issues, I see this as a critical challenge to organizational security that demands immediate attention.

I explore these issues in more detail in the whitepaper available below, which provides practical guidance on developing AI policies, managing organizational risks, and setting clear expectations with outside counsel. And–I specifically address questions every in-house counsel should ask their law firms about AI usage and data protection.

The promise of AI in legal practice is real, but so are the risks. The decisions organizations make now about AI adoption will have long-lasting implications for legal operations and data security.