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L2 · Confidentiality, privilege, accuracy and professional duties8 min read

Confidentiality: what happens to data you put into AI

Every prompt is a disclosure to a technology provider. Whether that disclosure is safe depends on the terms, not the brand.

Questions to ask about any AI tool

  1. Training: can the provider use your inputs or outputs to train or improve its models? Many enterprise and API offerings say no by default; many free consumer versions allow it unless users opt out.
  2. Retention: how long are prompts and outputs stored, and why (service delivery, abuse monitoring, legal holds)?
  3. Human access: can provider staff read your data, for example to review abuse? Under what controls?
  4. Disclosure: when will the provider disclose data to third parties or authorities, and will it tell you?
  5. Location and sub-processors: where is data processed and by whom?
  6. Security: certifications, encryption, access logs and incident notice.

Classify, then match

Use a simple data-to-tool matrix: data classes (public, internal, confidential, privileged, regulated personal data) against approved tools, with yes, no or "with controls" in each cell. People follow simple rules at the point of use.

Shadow AI

If you don't give lawyers a good approved tool, some will use their personal accounts. Blocking alone rarely works; an approved alternative plus training does.

Third-party confidentiality

NDAs, protective orders and data processing agreements may restrict sharing documents with sub-processors, including AI providers. Check before you upload a counterparty's documents or discovery material.

What this means for the General Counsel

What this means for a General Counsel

Confidentiality is the first gate for every legal AI tool, and for every AI tool the company buys. Make it routine:

  • Require no training on your data, stated retention, limited human access and notice of disclosure demands in every AI contract (the clause library has model wording).
  • Publish the data-to-tool matrix for the legal team and for the company.
  • Give people an approved tool quickly. A ban without an alternative pushes work into personal accounts you can't see.

Real example

In May 2023 Samsung Electronics restricted employee use of generative AI tools such as ChatGPT on company devices after discovering that staff had uploaded sensitive internal information, including source code and meeting notes, to ChatGPT, according to an internal memo reported by Bloomberg. Samsung's concern was that data sent to external AI services is stored on outside servers, is hard to retrieve and delete, and could be disclosed to other users. Source: Bloomberg — Samsung bans staff's AI use after spotting ChatGPT data leak (2 May 2023) ↗

Use it

Quick check · 3 questions

  1. 1.Which contract term most directly decides whether your prompts could end up improving a provider's model?

  2. 2.Why does a ban on public AI tools often fail without anything else?

  3. 3.You want to upload a counterparty's documents received under an NDA to an AI tool. What should you check first?

0 of 3 answered

Sources

Last reviewed 2026-10-01.