AI Queries Can Turn Into Legal Traps

A CFO might ask an AI about antitrust risks before a board meeting, thinking it’s just a quick check. But the answer could become evidence against her company if regulators step in. The issue comes from a recent court case involving Bradley Heppner, a former Texas finance chief. In 2023 he was charged with defrauding investors by moving $150 million between two hidden companies. While under investigation, he used an AI tool to draft legal strategy reports and claimed those documents were privileged. When the FBI seized his devices, the judge ruled that the AI‑generated files did not meet any of the three conditions for attorney‑client privilege: no lawyer was involved, there was no expectation of confidentiality, and the AI itself cannot give legal advice. The Heppner decision shows that any time a business uses an AI chatbot for legal questions, the resulting text can be discovered in court. If a merger later triggers an antitrust lawsuit, the opposing side could request the AI’s output and use it against the company.A different case on the same day, Warner v. Gilbarco, involved a plaintiff who used ChatGPT to prepare an employment‑discrimination claim. The judge protected those materials under the work‑product doctrine because they were created in anticipation of litigation and no lawyer was involved. The court said that AI does not automatically erase legal protections; it depends on how the tool is used. Both rulings rest on old rules: privilege needs a lawyer, direction from counsel, and confidentiality; work product protects materials made for litigation as long as they aren’t shared with an adversary. The new thing is that courts are applying these timeless principles to AI‑generated content, not creating fresh AI laws. For executives and companies, the takeaway is simple: focus on how you use AI rather than assuming it will shield you. If a lawyer drafts or reviews the material, keep confidentiality tight and document who has access. That will make a big difference if the documents later appear in discovery.