What Happens in AI Tools Doesn’t Stay in AI Tools: A New Texas Ruling on AI and Discovery

By Thomas W. Sankey, Joseph T. Walsh and Nicolette J. Zulli

If your employees or clients are using AI tools like ChatGPT to prepare for litigation, you need to know this: A Texas court just waded into the question of whether those conversations are discoverable, and the answer is more nuanced than you might expect. In a June 2026 ruling that is among the first of its kind in Texas, the Business Court addressed head-on whether a party’s ChatGPT “conversations” are protected attorney work product or fair game in discovery. The short version? The protection held, mostly. But the court also imposed disclosure obligations that should have every litigant rethinking how they use AI behind the scenes.

Read the full Alert on the Duane Morris LLP website.

Negotiating AI Use in Patent Litigation Protective Orders

By  Samuel W. Apicelli and Brandon A. Chan, Ph.D.

A protective order can preserve access to useful AI tools while protecting discovery. In Corent Technology, Inc. v. Amazon Web Services, Inc., the parties negotiated provisions allowing specified enterprise tools and case-specific AI workspaces, subject to restrictions on training, access and deletion. For legal departments, the order offers a concrete starting point for deciding how counsel and experts may use AI with litigation materials.

Read the full Alert on the Duane Morris LLP website.

From Disclosure to Detection – Converging AI Transparency Obligations in the EU and California

By Agatha H. Liu, Ph.D.

August 2, 2026, was a notable convergence point in AI governance: This was the day both the EU AI Act and the California AI Transparency Act brought core transparency obligations into force. Although the two laws were developed independently and differ in scope, they converge on a single regulatory theme: synthetic media must be identifiable and traceable—and in many cases disclosed to users or downstream systems. Such transparency requirements are emerging first because they require the least and enable the most. They address the most acute risks, such as impersonation, deepfakes and other fraud, while being the most technically mature and immediately implementable levers available to regulators.

Read the full Alert on the Duane Morris LLP website.

AI and Broker-Dealer Compliance: What Firms Need to Know Now

By Walter Saurack

For most broker-dealers, generative AI continues to become more deeply integrated into day-to-day workflows.

On July 13, 2026, Reuters reported that Morgan Stanley will test digital assistants later this summer that will interact with wealth management clients at all hours of the day.  The bank already uses AI agents internally to support its financial advisors.

This follows similar moves by Morgan Stanley’s competitors, such as Goldman Sachs, which announced in February its partnership with Anthropic to build agents for trading, transaction accounting, and client onboarding. A KPMG survey conducted this past June found that 51% of banks were already piloting AI agents.

The regulatory framework is struggling to keep up with adoption at such a scale, leaving firms to confront three pressing questions by themselves:  Are AI prompts and outputs records that firms should be legally required to retain?  What do firms owe customers if their data were to touch a third-party AI model?  And what should an AI-use policy actually say?

Here is where regulators and the largest firms currently stand on each.

Continue reading “AI and Broker-Dealer Compliance: What Firms Need to Know Now”

Newsom Under Pressure as California Unions Endorse New AI Bills

California Gov. Gavin Newsom has historically vetoed legislation surrounding automation. However, as he sets his sights on the White House, Newsom has been slow to set new regulations surrounding artificial intelligence while facing mounting pressure from the state’s unions. Duane Morris Partner Alex Karasik discussed the legal risks California employers should keep in mind when implementing the new technology.

Read the full article in International Employment Lawyer.

Webinar: AI and Wearables

Duane Morris will host the third session of its Wearable Webinars Series, Product Liability and IP Strategies for Wearables, on Tuesday, November 4, 2025, 12:00 p.m. to 12:30 p.m. Eastern.

REGISTER

Agatha Liu, Ph.D., will cover how wearables with diagnostic, monitoring or therapeutic claims fall under the FDA’s software as a medical device framework, including predetermined change control plans, good machine learning practices and real-world performance monitoring of adaptive algorithms.

Calif. Leads the Way in Consumer-Facing AI Regulation with Automated Decisionmaking Technology Rules

As an important development in U.S. AI regulation, California enacted its automated decisionmaking technology (ADMT) rules in September 2025. These are the first enacted, broadly scoped, consumer-facing AI governance rules in the country. They offer opt-out rights and logic disclosures for AI-driven significant decisions affecting consumers. The rules took effect on October 1, 2025, with compliance required by January 1, 2027, for covered businesses that use ADMT in significant decisions before that date. Read the full Alert on the Duane Morris website.

AI Catches Up to California Employers: Regulations for Automated-Decision Systems Now in Effect

With artificial intelligence developing at breakneck speed, California employment regulations are following right behind. Updated regulations issued by the California Civil Rights Council address the use of artificial intelligence, machine learning, algorithms, statistics and other automated-decision systems (ADS) used to make employment-based decisions. The updated rules, which took effect October 1, 2025, amend existing regulations, Cal. Code Regs., tit. 2, and are designed to protect against potential employment discrimination. The regulations apply to all employers with at least five employees working anywhere and at least one located within California. Read the full Alert on the Duane Morris website.

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The opinions expressed on this blog are those of the author and are not to be construed as legal advice.

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