Artificial Intelligence is rapidly reshaping legal work—offering powerful tools for research, drafting, contract review, and case management. But with great power comes great responsibility: you must understand both the promise and the risks to remain ethical, competent, and compliant.

Why You Should Read 2024 Formal Ethics Opinion 1

On November 1, 2024, the North Carolina State Bar issued 2024 Formal Ethics Opinion 1  – “Use of Artificial Intelligence in a Law Practice”. It provides clear guidance about:

• Maintaining competence under Rule 1.1, including understanding AI’s strengths, invisible biases, and “hallucinations” (Clearbrief)
• Protecting client confidentiality (Rule 1.6)—only use AI platforms with strong security, encryption, and clear data handling protocols (North Carolina Bar Association)
• Supervising use of AI (Rule 5.1 & 5.3)—you must oversee how associates or non-lawyers use such tools (One Legal)
• Reasonable billing (Rule 1.5)—don’t bill clients for AI speed-ups; ensure your fees reflect actual work (One Legal)

Stay Informed—Follow Trusted Tech & Legal Tech Sources

Tech is evolving daily. It is up to each of us to stay informed. We encourage following reputable blogs and news outlets:

• North Carolina’s own coverage through news reports in NC Lawyers Weekly, bar association newsletter articles, and the NC State Bar publications.
• Bob Ambrogi’s blog, LawSites, was among the first legal blogs. He offers robust articles about breaking news in technology, including the issues of AI’s legal and ethical concerns such as hallucinations, confidentiality risks, supervision, billing, etc. 
• Jordan Furlong is a lawyer, thought leader, and strategist who writes about the best new ideas and strategies for transforming the legal world through his blog on Substack, available through a free subscription.
• Clio, the cloud-based, practice management software, provides excellent information available whether you are a subscriber of their software or not. Their resources include blog posts, e-books, white papers, surveys, and sample AI policies for your law firm.

Be Wary of “Free” AI Tools & Misuse

Free, consumer-grade AI tools often come with hidden costs and ethical traps:

• Hallucinations: AI-generated text may look convincing—but contain fake cases or citations. UK courts recently flagged this citing of nonexistent cases as a “risk to justice”. You must use appropriate legal research platforms – all of them have their own AI proprietary tools – rather than asking for help from ChatGPT or Microsoft CoPilot. Always verify case law and statutes.
• Breach of confidentiality: Entering client data into a public AI provider like ChatGPT could expose sensitive information or violate privilege unless proper safeguards are in place.
• Hidden terms of service: Many free AI tools retain your input for training or allow third-party data access without you realizing. Vet terms of service thoroughly and never use free tools.
• Security gaps (“shadow AI”): When team members use unauthorized AI tools, they may bypass cybersecurity protocols. Establish approved platforms and clear firm policies. The Clio website has sample AI policies for law firms to implement.

Practical Tips for Ethical AI Adoption

1. Read and understand 2024 FEO 1 thoroughly. Include the opinion alongside your AI use policies.
2. Maintain tech competence—attend CLEs, read tech blogs, and attend workshops and CLEs. Obtain an AI certification – many of the top universities offer online certification programs, as well as LinkedIn Learning, or training classes through MasterClass.
3. Vet all AI tools: look for encryption, data usage transparency, secure deletion, and jurisdictional compliance. If you aren’t sure how to do this, work with a technology consultant such as Pegeen Turner with Legal Cloud Technology or reach out to Catherine Sanders Reach with the NC Bar Association Center for Practice Management.
4. Track and supervise usage: know who uses what AI, how often, and for what.
5. Update client agreements: include AI disclosures, consent language, and how efficiency savings will be passed on.
6. Verify outputs: always humanreview AIgenerated research, memos, or filings.

Recommended Reading & Resources

• NC Formal Ethics Opinion 2024FEO1—your ethical compass. 
• One Legal blog, “AI legal issues: Risks and considerations” – in-depth on hallucinations and confidentiality
• ABA Business Law Today’s “The Art of Mitigating Risk in the Brave New World of AI” – risk-focused strategies
• Clio AI Resources

Final Takeaway

AI can elevate your practice—especially as a solo or small firm. Just be sure you’re:

• Ethically grounded (thanks to 2024-FEO-1),
• Technologically informed and cautious,
• Transparent with clients—and
• Vigilant in verifying AI’s outputs.

Approach AI as a trusted assistant—not an autopilot—and you’ll tap into efficiency with confidence.