Watch Out: Your AI Chatbot Could Be the Prosecution’s Star Witness

A recent federal court ruling from the Southern District of New York has sent a tremor through the legal industry, providing a stark warning to any litigant who believes an AI chatbot is a safe place to store legal strategy. In United States v. Heppner, in a ruling on a motion in a case that remains pending, Judge Jed S. Rakoff held that documents prepared by a defendant using an open artificial intelligence service and later sent to the defendant’s attorneys, without their direction or involvement, do not qualify for attorney-client privilege. The decision draws a clear distinction between human legal counsel and digital assistants, suggesting that while AI systems can process information rapidly, communications with such systems may not create a legally enforceable expectation of confidentiality. 

The dispute arose after Bradley Heppner, a Texas financial executive, was indicted in connection with an alleged $150 million fraud scheme. After receiving his grand jury subpoena, and without any suggestion from his legal counsel, Heppner used Anthropic’s Claude AI tool to prepare reports that outlined potential defense strategy, what he might argue, and the law that the government might be using against him. Heppner then shared these materials with his legal team at Quinn Emanuel.  

The government had possession of these materials as a result of a search of Heppner’s home pursuant to a warrant, but the parties had agreed that the government would segregate the materials and not review them pending the resolution of Heppner's claims of privilege. The defense lawyers then argued these materials were shielded as attorney-client privileged or protected work product. Judge Rakoff was unconvinced, noting that the fundamental elements of attorney-client privilege were absent. In general, the court noted, the attorney-client privilege attaches to, and protects from disclosure, communications (1) between a client and his or her attorney (2) that are intended to be, and in fact were, kept confidential (3) for the purpose of obtaining or providing legal advice. Because the AI tool’s terms of service explicitly stated that inputted data was not confidential and could be shared with third parties, and the communication was not between attorney and client or done at the direction of the attorney, the court ruled that Heppner had not established a right to the benefits of attorney-client privilege. 

It is important to understand that most free versions of popular chatbots, including Claude, often called “open AI,” reserve the right to utilize a user’s queries and chat inputs for model training, to comply with law enforcement requests, and provide the data to other third parties for certain service or business-related purposes. These authorizations are typically set forth in a program’s terms of service and/or privacy policy. However, there are also AI programs that operate as closed systems like Lexis+ AI, where the vendor contractually guarantees that user data is never used for training and remains siloed with the account holder. While the use of a closed AI system likely would not have changed the outcome of this particular case, future courts may consider whether the confidentiality protections offered by such systems could affect the privilege analysis.  

For the legal profession, the Heppner case appears to be one of the first cases seeking to address issues relating to client research and communications in the rapidly evolving world of AI. Lawyers should consider warning their clients that the use of open AI may not be considered a confidential communication and that it is critical to read the terms of use and privacy policy of whatever platform you choose to use so that you understand how your inputs may be disclosed and utilized. As the AI world moves forward, attorneys and their clients should carefully monitor developments in court cases before incorporating AI into their case and trial preparation.  

This article was written by Magnolia Mullen and David Feldman. This article is for informational purposes only and is not intended to be relied upon as legal advice.