Authored by CM Law Managing Partner, Heather Clauson Haughian, this client alert examines a landmark federal court ruling that found entering privileged legal information into free AI tools like ChatGPT or Claude can waive attorney-client privilege—and explains what businesses and individuals must do to protect themselves.
Bottom line: If you’ve been using ChatGPT, Claude, Gemini, Copilot, or any other free AI tool to think through your legal situation — stop, and read this now.
A landmark ruling from the Southern District of New York has made one thing clear: entering privileged legal information into a free AI chatbot likely waives your attorney-client privilege. This isn’t a theoretical risk. It happened to a real defendant — and the court ordered his private legal strategy turned over to federal prosecutors.
What Happened
CASE:
United States v. Heppner
No. 1:25-cr-00503-JSR (S.D.N.Y. Feb. 17, 2026)
Judge Jed Rakoff ordered disclosure of AI-generated legal strategy documents, ruling they were not protected by attorney-client privilege or work product doctrine.
Facing securities fraud charges, the defendant used Anthropic’s Claude — a free public AI platform — to analyze information he had received from his attorneys. He entered that privileged information into the chatbot, reviewed the AI’s strategic assessments, and then shared the outputs back with his lawyers. When prosecutors sought these materials, the court ruled they had to be handed over.
Why Privilege Was Lost
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- AI is not an attorney. Attorney-client privilege requires an actual human attorney. Conversations with AI software — no matter how sophisticated — do not qualify.
- No confidentiality on free platforms. Free AI tools’ standard terms of service allow the provider to use your inputs to train future models and share data with third parties. Agreeing to those terms eliminates any reasonable expectation of confidentiality.
- AI doesn’t provide legal advice — and the client acted alone. The court noted AI tools disclaim legal advice. Because the defendant used the AI without direction from his attorneys, the work product doctrine didn’t apply either.
What You Should Do
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- Stop entering privileged info into free AI. Don’t input anything you’ve learned from your attorney — or any facts about your legal matter — into ChatGPT, Claude, Gemini, Copilot, or similar free tools.
- Use a closed, private AI system for sensitive matters. Unlike free public tools, some AI platforms operate in a “closed sandbox” — meaning your inputs are never used for training and never shared with third parties. These private, contractually secured systems offer a much stronger basis for maintaining privilege. Ask us before adopting any AI tool for legal work.
- Only use AI at your attorney’s direction. Unilateral AI use undermines both privilege and work product claims. When attorneys direct AI use in a legal context, protections are much stronger.
- AI content can be discoverable — even on private systems. Privilege and discoverability are two separate issues. A closed-sandbox system helps protect privilege, but if a court orders discovery of your AI interactions, that content can still potentially be compelled regardless of the platform. Don’t type anything into an AI that you would be uncomfortable seeing in a courtroom.
Questions about AI and your legal matters?
Our attorneys can help you navigate these risks and establish smart AI use policies. You can contact the author, Heather Clauson Haughian, at hhaughian@cm.law.
CM Law (cm.law) – formerly Culhane Meadows – is the largest national, full-service, women-owned & managed (WBE) law firm in the United States. Designed to provide experienced attorneys with an optimal way to practice sophisticated law while maintaining a superior work/life balance, the firm offers fully remote work options, a transparent, merit and math-based compensation structure, and a collaborative culture. Serving a diverse clientele—from individuals and small businesses to over 40 Fortune-ranked companies—CM Law is committed to delivering exceptional legal services across a broad spectrum of industries.
The foregoing content is for informational purposes only and should not be relied upon as legal advice. Federal, state, and local laws can change rapidly and, therefore, this content may become obsolete or outdated. Please consult with an attorney of your choice to ensure you obtain the most current and accurate counsel about your particular situation.
