Editor’s Note: This article provides a timely overview of the key litigation trends and risk factors on the radar of in-house counsel in 2024. As highlighted by the recent Norton Rose Fulbright Annual Litigation Trends Survey results and expert commentary, the rapid advancement of AI technologies like ChatGPT is creating new legal gray areas around topics such as IP disputes and generative content. At the same time, longstanding issues like cybersecurity vulnerabilities and regulatory actions continue to pose significant litigation threats. The piece also effectively contrasts the appetite for adopting AI tools to drive legal efficiencies with the pressing need to mitigate the associated new risks. With AI systems now matching or exceeding human performance on skills like contract review and bar exam-passing ability, corporate legal teams are rightfully concerned about the disruptive potential of these technologies. Moving forward, it will be critical for lawmakers, legal experts, tech leaders, and insurance carriers to collaborate closely to develop frameworks, policies, and products that allow businesses to harness the upside of AI while protecting against the downsides. The stakes are only getting higher as AI capabilities accelerate across industries.
Content Assessment: Corporate Counsel Sound the Alarm on AI and Cyber Risks, Norton Rose Fulbright Survey Finds
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Industry News – Artificial Intelligence Beat
Corporate Counsel Sound the Alarm on AI and Cyber Risks, Norton Rose Fulbright Survey Finds
ComplexDiscovery Staff
In-House Counsel Express Growing Concerns Over AI and Cyber Risks
As the march of technology continues to shape the legal and corporate landscapes, a report released by Norton Rose Fulbright on Wednesday indicates that in-house counsel are now squarely focusing on the emerging risks and regulatory challenges presented by artificial intelligence (AI) and cybersecurity. More than 400 general and in-house litigation leader responses suggest an industry grappling with the expanding influence of technology.
Generative AI Presents Benefits Alongside New Legal Uncertainties
According to the latest Annual Litigation Trends Survey, 40% of respondents have seen their exposure to cybersecurity and data protection disputes sharply increase in 2023, with similar concerns spilling into 2024. As these technological threats grow, the survey indicates a notable expectancy of heightened intellectual property dispute exposure tied to AI advancements. “2023 brought rapid-fire developments in artificial intelligence, and in-house counsel are eager both to respond to new uncertainties around generative AI and also take advantage of the efficiencies it promises,” said Steven Jansma, U.S. Head of Litigation and Disputes at Norton Rose Fulbright. And while AI’s legal landmines loom large, the report uncovers that over a third of corporate counsels endorse the adoption of generative AI technologies by their legal teams, underscoring a complex interdependence between innovation and mitigating litigation risk.
Regulatory Proceedings and ESG Litigation Also Top the List of Legal Priorities
Regulatory proceedings, environmental, social, and governance (ESG) litigation, and financial fraud class actions are also among the top concerns for corporate counsel, with over 60% of survey participants involved in at least one regulatory proceeding in 2023, marking an uptick from 2022. Class actions related to banking crisis-induced financial fraud more than doubled. Additional matters are also rising on the corporate agenda, such as greenwashing, diversity policies, and compliance in the politically charged environment of 2024. Richard Krumholz, Global Head of Litigation and Disputes, remarked, “The litigation environment is more complex when business relationships are less predictable, particularly in these volatile economic and political cycles.”
Companies Bolster Legal Teams to Navigate Tech-Driven Volatility
The survey underpins an evolving judicial marketplace where companies are bolstering their in-house litigation teams, with a notable 52% increase from the previous year, to navigate these tech-driven tumultuous times. Larger firms with revenues over $1 billion are reportedly spending six times more on litigation than those with revenues under $100 million, illuminating a disparity in legal expenditure correlating with size and capacity to manage disputes. The report follows a year marked by significant AI milestones, most notably the Stanford Center for Legal Informatics successfully training GPT-4 to pass the Bar exam. With GPT-4 ranking in the 90th percentile, surpassing the average scores of human test-takers, the pressure is on both the legal sector and the associated insurance industry to adapt to this new AI-infused reality. Clyde & Co.’s market predictions suggest that as generative AI infiltrates the tech fabric, insurance for AI-related risks will become essential. Divergence in global AI regulations and the anticipation of increased AI litigation underline the escalating need for legal expertise in this domain.
News Sources
- Norton Rose Fulbright’s 19th Annual Litigation Trends Survey reveals heightened risk around cybersecurity and data protection amid AI boom
- Norton Rose Fulbright’s 2024 Annual Litigation Trends Survey
- Sirion 2024 Predictions: A Legal Landscape Reshaped by AI
- Regulatory challenges across energy, AI, and gaming industries: Clyde & Co
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- The Transfer of Wealth in eDiscovery: Q4 2023’s M&A Activities
- The Paradox of Equity: Analyzing the Equitable Facade of Private Equity
Source: ComplexDiscovery