California’s New AI Rules for Lawyers and Arbitrators: What SB 574 Means for Your Practice
[Law Clerk Caroleen Bitar contributed.]
The California Legislature passed Senate Bill 574, which, if signed into law, will establish new statutory requirements for attorneys and arbitrators who use generative artificial intelligence. Introduced by Sen. Tom Umberg, the bill adds section 6068.1 to the Business and Professions Code and amends Code of Civil Procedure Section 128.7, among other changes.
The bill defines “generative artificial intelligence” as “an artificial intelligence system that can generate derived synthetic content, including text, images, video, and audio that emulates the structure and characteristics of the system’s training data.” That definition covers tools many attorneys already use, such as ChatGPT, Claude, and Copilot.
The bill draws a hard line around how attorneys and arbitrators can use AI in their legal practice. Here is what the bill requires.
No Delegating the Practice of Law
One of the bill’s main focuses is to ensure attorneys do not blindly delegate legal work to AI. To this end, the bill would prohibit attorneys from “delegate[ing] the practice of law to generative artificial intelligence.”
If passed, the new law would require attorneys to take reasonable steps to verify the accuracy of generative AI outputs, “including, but not limited to, the accuracy of all case and statutory citations,” and to correct any erroneous or hallucinated output in any material they use.
Keep Client Information Out of Unprotected AI Systems
Another provision of the bill prohibits attorneys from entering confidential, personal identifying, or other nonpublic information into a generative AI system unless it restricts access to that information to the attorney and persons authorized by the attorney who are under obligations to protect it.
California defines personal identifying information, or PII, broadly. PII includes driver’s license numbers, dates of birth, Social Security numbers, addresses and phone numbers of parties, victims, witnesses, and court personnel, medical or psychiatric information, financial information, account numbers, and anything sealed by court order or deemed confidential by court rule or statute.
Verify Everything
Per a proposed amendment to Code of Civil Procedure section 128.7, attorneys may face sanctions for filing a brief, pleading, motion, or any other paper containing citations that the attorney “has not personally verified, including any citation provided by generative artificial intelligence.” This verification requirement applies to all citations, not just AI-generated ones.
Disclose AI Use
For documents submitted to the court, attorneys will have to disclose the use of generative AI[NK1.1]. The bill does not specify how they must disclose that information. For content provided to the public[NK2.1], the requirement is softer. Attorneys will have to “consider whether to disclose” the use of generative AI.
The bill does not define “content provided to the public” or give examples. It could potentially include materials such as blog posts, articles, client alerts, and newsletters, but the bill does not specify.
Rules for Arbitrators
Proposed section 1282.1 of the Code of Civil Procedure applies similar principles to arbitrators. An arbitrator “shall not delegate any part of their decision-making process to any generative artificial intelligence tool.” If an arbitrator relies on information generated by AI outside the record, the bill requires “appropriate disclosures to the parties beforehand” and, as far as practical, an opportunity for the parties to comment.
Judicial Council and ADR Provisions
The bill also directs the Judicial Council to publicly revisit standard 10.80 of the California Standards of Judicial Administration to incorporate any necessary changes reflecting the further development of generative AI.
Separately, SB 574 amends section 6173 of the Business and Professions Code to expand the State Bar’s ADR certification program. The amendments establish procedures for the State Bar or an approved professional organization to receive, investigate, and resolve complaints that a certified firm, provider, or practitioner failed to comply with applicable ethical standards.
Complaint proceedings must occur privately and confidentially. Though the State Bar may publicly disclose non-privileged information about the outcome afterwards.
What This Means for California Attorneys
Regardless of SB 574’s outcome, attorneys who use AI should take the following steps:
- Audit your AI tools. Review how your firm’s AI system uses client data.
- Build a citation verification habit. The amended section 128.7 requires personal verification of every citation in every filing, AI-generated or not. This should already be part of your workflow, but the bill makes it a statutory obligation.
- Prepare for mandatory disclosure. If you use AI to help prepare a court filing, you will need to say so. Because the bill does not specify how disclosure must be made, consider adopting a consistent approach, such as a short statement in the filing. For public-facing content, the bill leaves the decision to the attorney. Decide in advance how your firm will handle it.
- Train your team. Make sure all attorneys, paralegals, and legal assistants understand that while AI can reduce the time it takes to accomplish tasks (i.e., research, drafting, etc.), they must always carefully review the output for accuracy. Whether this bill passes or not, there are severe consequences for submitting AI-generated content that is inaccurate or outright false.
SB 574 awaits Gov. Gavin Newsom’s signature. If signed, it goes into effect Jan. 1, 2027.
Consulting experienced legal counsel can help attorneys and firms develop AI use policies that comply with these emerging requirements.
Nicholas Kanter is Chair of Lewitt Hackman’s Business Litigation Practice Group and a Shareholder in the Firm’s Employment Practice Group.
Caroleen Bitar earned her J.D. at Loyola Law School and is awaiting bar exam results.