Generative Artificial Intelligence Tools: ABA Formal Opinion 512 Provides Needed Guidance on the Benefits and Burdens of Lawyers’ Use of GAI

By Wendy J. MuchmanThis article is based on the author’s presentation at the 2024 NCBE Annual Bar Admissions Conference held on May 2–5, 2024, in Chicago, Illinois.Given the surge in the development of generative artificial intelligence (GAI), lawyers are grappling with questions about its impact on their ethical responsibilities. On July 29, 2024, the American Bar Association (ABA) Standing Committee on Ethics and Professional Responsibility issued Formal Opinion 512, “Generative Artificial Intelligence Tools,” which provides the legal profession thoughtful guidance about lawyers’ ethical obligations when using such tools. The opinion is a timely, useful source for information on and insights into this pressing topic.1

The opinion begins by discussing how lawyers use AI to assist in their legal work. Examples include AI-assisted review of discovery documents, contract analytics, and prediction of litigation outcomes, as well as improved search results in legal research.

While the opinion makes clear that “there is no single definition of artificial intelligence,” it states that “at its essence, AI involves computer technology, software, and systems that perform tasks traditionally requiring human intelligence.”2 The opinion specifically focuses on GAI, noting that it has “drawn the attention of the legal profession and the world at large.”3 It defines GAI as tools that “[]can create various types of new content, including text, images, audio, video, and software code in response to a user’s prompts and questions.”4 “To accomplish this, these tools analyze large amounts of digital text culled from the internet or proprietary data sources. Some GAI tools are described as ‘self-learning,’ meaning they will learn from themselves as they cull more data.”5 While “GAI tools may assist lawyers in tasks such as legal research, contract review, due diligence, document review, regulatory compliance, and drafting letters, contracts, briefs, and other legal documents,”6 lawyers must understand the issues involved in using this new technology.

The opinion notes that given the recent and evolving nature of GAI tools, it can best serve the profession by identifying pressing ethical issues and offering “general guidance for lawyers attempting to navigate this emerging landscape,” realizing that updated guidance will likely be needed as GAI tools continue to develop.7 The ethical issues discussed relate to lawyers’ duties of competence, confidentiality, communication, supervision, candor, and duty to charge reasonable fees.8

Competence

The duty of competence is implicated in everything lawyers do. According to the ABA opinion, “[m]odel Rule 1.1 obligates lawyers to provide competent representation to clients.”9 It requires lawyers to “exercise the ‘legal knowledge, skill, thoroughness and preparation reasonably necessary for the representation,’ as well as to understand ‘the benefits and risks associated’ with the technologies used to deliver legal services to clients.”10 “Lawyers may ordinarily achieve the requisite level of competency by engaging in self-study, associating with another competent lawyer, or consulting with an individual who has sufficient expertise in the relevant field.”11

But what does the requisite level of competence mean at the new frontier of GAI? Lawyers “need not become GAI experts,” but they “must have a reasonable understanding of the capabilities and limitations” of any GAI tool they chose to use.12 Given the “fast-paced evolution of GAI tools,” this requires attention and often caution.13

Some risks to competent representation are inherent in the use of GAI tools. Inaccurate or false outputs can come from low-quality source data due to bias, lack of breadth, or age. As such tools still make mistakes, “lawyers’ uncritical reliance on content created by a GAI tool” is risky—and almost certainly malpractice.14

Another question addressed in the competence portion of the opinion is how much independent review is necessary for lawyers to verify their work. Noting there is no single answer to this question, the opinion explains that the required verification is factually specific and “will necessarily depend on the GAI tool and the specific task that it performs.”15 Thus a document review requires more independent review than work using the tool to generate ideas. Regardless of the situation, GAI tools cannot solely substitute for a lawyer’s competent legal work.

While some AI uses in email, computerized legal research, and the use of electronic documents are integrated into the practice of law and accepted as part of lawyers providing competent legal services, it is too early to claim that GAI tools are required for competent representation.

Confidentiality

The duty of confidentiality is broad and protects from disclosure without client informed consent “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.”16 Lawyers using GAI must be cognizant of this duty, as well as the confidentiality obligations of Rules 1.9(c) and 1.18(b).

Thus, “[b]efore lawyers input information relating to the representation of a client into a GAI tool, they must evaluate the risks that the information will be disclosed to or accessed by others outside the firm.”17 There is currently no one-size-fits-all way to assess that risk. GAI tools now differ in their ability to protect information so this risk assessment will be fact based.

Of particular concern regarding risk to confidential client information is the use of “self-learning GAI tools.”18 With self-learning tools, individuals input information into the tool and it relies on that information to further learn, which by its “very nature raise[s] the risk that information relating to one client’s representation may be disclosed improperly, even if the tool is used exclusively by lawyers at the same firm.”19 The opinion cautions that, as of this date, given the risk that “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.”20

If, however, a lawyer is using a self-learning GAI tool in connection with a legal representation and not inputting information relating to the representation, client consent is not required. An example of such as situation is where “a lawyer is using the tool for idea generation in a manner that does not require inputting information relating to the representation.”21

Boilerplate waivers will not suffice as informed consent. Informed consent requires that “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.”22 “Part of informed consent requires the lawyer to explain the extent of the risk that later users or beneficiaries of the GAI tool will have access to information relating to the representation.”23

Lawyers should protect against improper disclosures, and can start by “read[ing] and understand[ing] the Terms of Use, privacy policy, and related contractual terms and policies of any GAI tool they use to learn who has access to the information that the lawyer inputs into the tool or consult with a colleague or external expert who has read and analyzed those terms and policies.”24 “Consulting with IT professionals or cybersecurity experts is another way for lawyers evaluate the risks involved in using the tool.

Communication

Even “where Model Rule 1.6 does not require disclosure and informed consent, the lawyer must separately consider whether other Model Rules … require disclosing the use of a GAI tool in the representation.”25 The most obvious example is the duty of communication under Rule 1.4. Model Rule 1.4(a)(2) requires that a lawyer shall “reasonably consult with the client about the means by which the client’s objectives are to be accomplished,”26 and “Model Rule 1.4(b) obligates lawyers to explain matters ‘to the extent reasonably necessary to permit a client to make an informed decision regarding the representation.’”27 Further, “comment [5] to Rule 1.4 explains, ‘the lawyer should fulfill reasonable client expectations for information consistent with the duty to act in the client’s best interests, and the client’s overall requirements as to the character of representation.’”28 The opinion recognizes that lawyers will have questions about when they “might be required to disclose their use of GAI tools to clients pursuant to Rule 1.4.”29

Once again, there is no one-size-fits-all guideline. These questions are “factually specific inquires,” and lawyers must use their professional judgment to determine based upon the circumstances whether such communication is necessary. But disclosure is a must if a client asks, and the opinion points to situations where disclosure is required regardless. When inputting client information, informed consent must be obtained in advance, “when the use of a GAI tool is relevant to the basis or reasonableness of a lawyer’s fee.”30

Of course, lawyers may determine that, in the interest of effective client representation, a discussion of the use of GAI tools is best practice. In all circumstances, “[t]he engagement agreement is a logical place to make such disclosures and to identify any client instructions on the use of GAI in the representation.”31

Meritorious Claims and Contentions and Candor to the Tribunal

Given the frequent press coverage over the last year relating to issues where lawyers used GAI and cited “nonexistent opinions, inaccurate analysis of authority, and use of misleading arguments,”32 lawyers are likely aware of this risk, as well as how courts are currently responding to these issues, both by requiring lawyers to disclose their use of AI or sanctioning lawyers for misstatements of the law and improper analysis.

Supervisory Responsibilities

Issues of supervision are important when firms adopt GAI tools. The opinion is instructive on how to meet these ethical obligations. Implementation of training in several areas, including on the use of the tools, on the ethical issues involved, on best practices for protecting confidential client information, as well as on secure data handling and privacy concerns, are important. “Managerial lawyers must establish clear policies regarding the law firm’s permissible use of GAI, and supervisory lawyers must make reasonable efforts to ensure that the firm’s lawyers and nonlawyers comply with their professional obligations when using GAI tools.”33

The opinion includes a discussion of the relevance of earlier opinions on outsourcing of legal and non­legal services as excellent resources for guidance on how to meet supervisory obligations.34 As examples, “lawyers must ensure … that the third party will do the work capably and protect the confidentiality of information relating to the representation,” and emphasize, among other things, “the importance of: reference checks and vendor credentials; … understanding the vendor’s conflicts check system to screen for adversity among firm clients; and the availability and accessibility of a legal forum for legal relief for violations of the vendor agreement.”35

Fees

On the forefront of issues in this sphere facing the legal profession is how the use of GAI will impact current billing models. What is a reasonable fee when lawyers use GAI? Under what circumstances can clients be charged for the development or use of a GAI tool, and how are reasonable expenses determined? The opinion reviews historical guidance as the best source of answers to these questions, referring to an earlier ABA Opinion on Legal Fees, ABA Formal Ethics Opinion 93-379.36

Model Rule 1.5 has a list of nonexclusive criteria that assist in the evaluation of whether a fee is reasonable. These factors remain relevant. While GAI tools “may provide lawyers with a faster and more efficient way to render legal services to their clients,” when lawyers are billing hourly, they must only bill for their actual time.37 In addition, “[t]he factors set forth in Rule 1.5(a) also apply when evaluating the reasonableness of charges for GAI tools when the lawyer and client agree on a flat or contingent fee.”38 “A fee charged for which little or no work was performed is an unreasonable fee.”39

Another common concern is when lawyers can charge GAI tool fees as a client expense. “Rule 1.5(a) requires that disbursements, out-of-pocket expenses, or additional charges be reasonable.”40 For example, a lawyer typically may bill to the client the actual cost incurred in paying a court reporter to transcribe a deposition or the actual cost to travel to an out-of-town hearing.41 But in most circumstances, the lawyer should not add a surcharge to the actual cost of such expenses.42 The opinion provides specific guidance to help lawyers analyze the characteristics and uses of each GAI tool to determine when the tool is overhead and when it is a cost that would ordinarily be reasonable for a lawyer to bill to a client.

On the issue of reasonable fees, the opinion reminds lawyers that “‘[c]ompetent representation requires the legal knowledge, skill, thoroughness and preparation reasonably necessary for the representation.’43 Comment [8] explains that ‘[t]o maintain the requisite knowledge and skill [to be competent], a lawyer should keep abreast of changes in the law and its practice, including the benefits and risks associated with relevant technology, engaging in continuing study and education and comply with all continuing legal education requirements to which the lawyer is subject.’”44 The concluding thought on reasonable fees is a reminder that lawyers “may not charge clients for time necessitated by their own inexperience.”45

Conclusion

The ABA Standing Committee on Ethics and Professional Responsibility issues ethics opinions to guide courts, lawyers, and the public in applying the ABA Model Rules of Professional Conduct to issues of interest to the profession. This opinion on GAI reviews lawyers’ relevant ethical duties and provides important guidance, including citations to other helpful authority. It concludes with the reminder that given the “ever-evolving use of technology by lawyers and courts, lawyers must be vigilant in complying with the Rules of Professional Conduct.”46

Disclaimer: The opinions expressed in this article are those of the author, and they do not necessarily reflect the opinions of Northwestern University or the American Bar Association.

This article originally appeared in The Bar Examiner print edition, Fall 2024 (Vol. 93, No. 3), pp. 20–24.Contact us to request a pdf file of the original article as it appeared in the print edition.