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California lawmakers are proposing restrictions on AI for attorneys and arbitrators. Senate Judiciary Chair Tom Uberg, D-Santa Ana, has introduced legislation to formally regulate AI use in the legal field.
The legislation codifies existing guidance from the California State Bar on ethical AI use. If it becomes law, SB 574 will require attorneys to protect confidential client information, prevent discrimination in AI use, and personally verify AI outputs. Additionally, the act would require attorneys to personally verify any citations in court filings. Lastly, the act would prohibit arbitrators from delegating any decision making to an AI model.
Senator Uberg has explained that he proposed the bill in response to concerns about AI use in the legal field, such as citations to nonexistent cases. Even sophisticated, well-trained AI models make up, or “hallucinate,” legal support for their propositions. These hallucinations have made their way to the courts. Last September, California’s Second District Court of Appeals fined an attorney $10,000 after he submitted briefing to the court containing hallucinated cases and citations. This is one of over 200 cases across the country where an attorney has been caught submitting a brief with hallucinated cases. Additionally, SB 574 imposes requirements for preventing AI-based harms beyond hallucinated case citations. If the bill becomes law, attorneys will be responsible for protecting client confidentiality when using AI, as well as preventing discrimination by AI tools. The bill does not prohibit attorneys from using AI tools to draft court filings and other legal documents.
SB 574 also creates new duties for arbitrators. Under SB 574, arbitrators cannot delegate any decision-making to an AI tool. This inclusion in the law comes on the heels of the American Arbitration Association-International Centre for Dispute Resolution (AAA-ICDR) releasing an AI arbitrator for use in limited cases. If SB 574 were to pass in its current state, cases subject to California-based arbitration would not be able to use the AAA-ICDR AI arbitrator. Additionally, individual arbitrators would not be permitted to delegate important decision-making tasks to AI tools.
SB 574 does not impose any independent penalties and would be enforced against attorneys through court sanctions and the State Bar disciplinary process. The bill does not currently specify any penalties for arbitrators.
So far, this amended version of SB 574 has only been introduced, and its provisions may change throughout the legislative process. The legislation passed in the Senate Standing Committee on Appropriations on January 22. As a leader in ethical AI use in the legal field, Reed Smith will be tracking this legislation closely.
Client Alert 2026-019