When it Comes to AI, Lawyers have Model Rules to Guide Ethical Decisions

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The MedLegal Professor taught us that the ABA has weighed in on ethics, lawyers, and AI, so we decided to take a closer look. Simply Research users have access to the full text of the document.

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Generative Artificial Intelligence Tools, Formal Opinion 512 (ABA 07/29/24)

What Happened

The American Bar Association addressed artificial intelligence and ethics in the practice of law, noting that lawyers using AI tools must fully consider their applicable ethical obligations.

The ABA noted that AI is commonly used by lawyers for:

+ Discovery in litigation.

+ Contract analytics.

+ Predicting how judges might rule.

+ Basic legal research.

Workers' Comp 101: Could you define "artificial intelligence"? In its opinion, the ABA said there wasn't one definition. Instead, it noted that AI involves computer technology, software, and systems that perform tasks traditionally requiring human intelligence. Additionally, "the ability of a computer or computer-controlled robot to perform tasks commonly associated with intelligent beings is one definition," and "the term is frequently applied to the project of developing systems that appear to employ or replicate intellectual processes characteristic of humans, such as the ability to reason, discover meaning, generalize, or learn from past experience.

A subset of AI technology that has drawn the attention of the legal profession and the interest of the ABA is generative AI, "which can create various types of new content, including text, images, audio, video, and software code in response to a user's prompts and questions.

While such tools hold the potential to increase productivity and efficiency, the ABA also found important questions raised by their use, including:

+ What level of competency should lawyers acquire regarding a GAI tool?

+ How can lawyers satisfy their duty of confidentiality when using a GAI tool that requires input of information relating to a representation?

+ When must lawyers disclose their use of a GAI tool to clients?

+ What level of review of a GAI tool's process or output is necessary?

+ What constitutes a reasonable fee or expense when lawyers use a GAI tool to provide legal services to clients?

Rules of Professional Conduct

ABA Model Rule of Professional Conduct 1.1 obligates lawyers to provide competent representation to clients. To do so, lawyers must exercise the "legal knowledge, skill, thoroughness and preparation reasonably necessary for the representation" and understand "the benefits and risks associated" with technologies used to deliver legal services.

Model Rule 1.6 requires lawyers to keep confidential all information relating to the representation of a client, regardless of its source, unless the client gives informed consent, disclosure is impliedly authorized to carry out the representation, or disclosure is permitted by an exception. Model Rules 1.9(c) and 1.18(b) require lawyers to extend similar protections to former and prospective clients' information.

Model Rule 1.4 addresses lawyers' duty to communicate with their clients, and states that a lawyer shall reasonably consult with clients about the means by which the client's objectives are to be accomplished.

Model Rule 3.1 states that a lawyer shall not bring or defend a proceeding or assert or controvert and issue therein unless there is a basis in law or fact for doing so that is not frivolous.

Model Rule 3.3 makes it clear that lawyers cannot knowingly make a false statement of law or fact to a tribunal or fail to correct a material false statement of law or fact previously made to a tribunal.

Model Rules 5.1 and 5.3 place ethical duties on lawyers charged with managerial and supervisory responsibilities.

Under Model Rule 1.5, a lawyer's fees must be reasonable, and a lawyer must communicate to a client the basis on which the lawyer will charge for fees and expenses unless the client is a regularly represented client and the terms are not changing.

What the ABA Said

Competence: Lawyers don't need to be GAI experts, but they do need to have a reasonable understanding of the capabilities and limitations of a specific technology a lawyer might use. To do so, "lawyers should considering reading about GAI tools targeted at the legal profession, attending relevant continuing education programs, and ... consulting others who are proficient in GAI technology."

GAI tools are subject to mistakes, and there have been well-known reports of AI "hallucinations." Because of AI's ability to generate errors, the ABA warned that "lawyers' uncritical reliance on content created by a GAI tool can result in inaccurate legal advice to clients or misleading representations to courts and third parties."

How much independent verification must a lawyer do? According to the ABA, it depends.

"For example, if a lawyer relies on a GAI tool to review and summarize
numerous, lengthy contracts, the lawyer would not necessarily have to manually review the entire set of documents to verify the results if the lawyer had previously tested the accuracy of the tool on a smaller subset of documents by manually reviewing those documents, comparing then to the summaries produced by the tool, and finding the summaries accurate," the ABA wrote, but "lawyers may not leave it to GAI tools alone to offer legal advice to clients, negotiate clients’ claims, or perform other functions that require a lawyer’s personal judgment or participation."

Confidentiality: When mingling GAI and confidential information, lawyers must assess the likelihood of disclosure and unauthorized access, the sensitivity of the information, the difficulty of implementing safeguards, and the extent to which safeguards negatively impact the lawyer's ability to represent the client.

What's a lawyer to do?

When it comes to GAI tools and their ability to self-learn, the ABA tells lawyers to get informed consent.

"Because many of today’s self-learning GAI tools are designed so that their output could lead directly or indirectly to the disclosure of information relating to the representation of a client, a client’s informed consent is required prior to inputting information relating to the representation into such a GAI tool," the ABA. "For the consent to be informed, the client must have the lawyer’s best judgment about why the GAI tool is being used, the extent of and specific information about the risk, including particulars about the kinds of client information that will be disclosed, the ways in which others might use the information against the client’s interests, and a clear explanation of the GAI tool’s benefits to the representation."

Boilerplate language won't cut it, and lawyers must explain the extent of the risk that later users or beneficiaries of the GAI tool will have access to information relating to the representation.

Some things lawyers should do to evaluate risk that information will be disclosed or accessed by others using a GAI tool include:

+ Reading and understanding the Terms of Use, privacy policy, and related contractual terms and policies of GAI tools.

+ Consulting with IT professionals or cyber security experts to fully understand terms and policies as well as how GAI tools utilize information.

Communication: Client consultation is necessary when the GAI output will influence a significant decision in the representation, such as when a lawyer relies on GAI to evaluate potential litigation outcomes or jury selection.

"A client would reasonably want to know whether, in providing advice or making important decisions about how to carry out the representation, the lawyer is exercising independent judgment or, in the alternative, is deferring to the output of a GAI tool," the ABA wrote. "Or there may be situations where a client retains a lawyer based on the lawyer’s particular skill and judgment, when the use of a GAI tool, without the client’s knowledge, would violate the terms of the engagement agreement or the client’s reasonable expectations regarding how the lawyer intends to accomplish the objectives of the representation."

As a best practice, ABA advised that lawyers tell clients how they employe GAI tools to assist in the delivery of legal services as such an explanation may serve the interest of effective client communication.

"The engagement agreement is a logical place to make such disclosures and identify any client instructions on the use of GAI in the representation," the ABA wrote.

Meritorious Claims and Candor: Lawyers are to explain matters to the extent reasonably necessary to permit a client to make an informed decision regarding representation. Output from a GAI tool must be carefully reviewed to ensure that assertions made to a court are not false, something that's been a challenge as lawyers' use of GAI outputs have included citations to nonexistent opinions, inaccurate analysis of authority, and use of misleading arguments.

What should lawyers do?

"Lawyers should review for accuracy all GAI outputs," the ABA wrote. "In judicial proceedings, duties to the tribunal likewise require lawyers, before submitting materials to a court, to review these outputs, including analysis and citations to authority, and to correct errors, including misstatements of law and fact, a failure to include controlling legal authority, and misleading arguments."

Supervisory Responsibilities: Managerial lawyers must create effective measures to ensure that all lawyers in the firm conform to the rules of professional conduct, and supervisory lawyers must supervise subordinate lawyers and nonlawyer assistants to ensure that subordinate lawyers and nonlawyer assistants conform to the rules.

When it comes to GAI, supervisory lawyers need to make sure their subordinates are trained on the ethical and practical use of GAI tools as well as on risks associated with GAI.

"Training could include the basics of GAI technology, the capabilities and limitations of the tools, ethical issues in use of GAI and best practices for secure data handling, privacy, and confidentiality," the ABA wrote.

One training suggesting the ABA offered was that all material produced by GAI tools be marked as such when stored in a client or firm file so future users understand potential fallibility of the work.

Fees: Before charging a client for the use of GAI tools or services, the lawyer must explain the basis for the charge, preferably in writing.

The ABA advised that billing should be based on the work performed.

"If a lawyer uses a GAI tool to draft a pleading and expends 15 minutes to input the relevant information into the GAI program, the lawyer may charge for the 15 minutes as well as for the time the lawyer expends to review the resulting draft for accuracy and completeness," the ABA wrote, noting that it may be unreasonable to charge the same flat fee when using the GAI tool as when not using it.

Can lawyers pass along the costs of GAI to clients?

"To the extent a particular tool or service functions similarly to equipping and maintaining a legal practice, a lawyer should consider its cost to be overhead and not charge the client for its cost absent a contrary disclosure to the client
in advance," the ABA explained. "For example, when a lawyer uses a GAI tool embedded in or added to the lawyer’s word processing software to check grammar in documents the lawyer drafts, the cost of the tool should be considered to be overhead."

But on the other hand, there may be times when expenses are properly charged to a client.

"When a lawyer uses a third-party provider’s GAI service to review thousands of voluminous contracts for a particular client and the provider charges the lawyer for using the tool on a per-use basis, it would ordinarily be reasonable for the lawyer to bill the client as an expense for the actual out-of-pocket expense incurred for using that tool," the ABA wrote.

And what about the time it takes for a lawyer to get up to speed on technology?

"Lawyers must remember that they may not charge clients for time necessitated by their own inexperience," the ABA wrote. "Therefore, a lawyer may not charge a client to learn about how to use a GAI tool or service that the lawyer will regularly use for clients because lawyers must maintain competence in the tools they use, including but not limited to GAI technology."

On the other hand, if a client explicitly requests that a specific GAI tool be used in furtherance of the matter and the lawyer is not knowledgeable in using that tool, it may be appropriate for the lawyer to bill the client to gain the knowledge to use the tool effectively.

Takeaway

While GAI represents new technology in the legal field, lawyers must still comply with the Rules of Professional Conduct and adhering to their ethical responsibilities for clients' protection.

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