NCSB Journal Summer 2026

models, leading to potential confidentiality breaches. AI is Already Everywhere A total ban is practically impossible to enforce because AI is no longer just a stand alone chatbot; it is embedded in the soft ware lawyers use daily. From Westlaw and Lexis+ to Microsoft 365 and Zoom, AI fea tures are integrated into the very infrastruc ture of modern legal practice. Blocking AI entirely would effectively mean blocking the industry’s standard operating tools. The Efficiency Imperative Clients expect efficiency. If a firm charges for five hours of work that could be done in one hour with AI, they risk being undercut by competitors who have safely integrated these tools. As one source notes, prohibition drives usage underground; clear policies bring it into the open where it can be supervised. Instead of a blockade, firms need a guardrails policy that empowers lawyers to use technology safely while strictly adhering to ethical and legal obligations. In North Carolina, law firms can use 2024 Formal Ethics Opinion 1 “Use of Artificial Intelligence in a Law Practice” to help guide policy. Other helpful guidance can be found in the ABA Task Force on Law and Artificial Intelligence report ( see bit.ly/4mqQoNw), as well as other state ethics opinions and task force reports ( see bit.ly/3Q6OBBj). Here are some components of an effec tive AI use policy: Establish a Risk-Based “Traffic Light” System In their step-by-step guide for crafting an AI policy for your law firm, legal AI company Casemark suggests a classification system to streamline approval ( see, bit.ly/4dNuTnT): · Red Light (Prohibited): Inputting con fidential client data into public/con sumer AI tools; using AI for fact-finding without verification; automated deci sion-making for client outcomes. · Yellow Light (Oversight Required): Legal research, document review, and first drafts. These require adherence to specific verification protocols. · Green Light (Standard Use): Administrative tasks, marketing content, Building a Thoughtful Policy: Best Practices

and internal scheduling. The “Human in the Loop” is Non Negotiable The policy should explicitly state that AI is a tool, not a replacement for professional judgment. Due to the persistent risk of hal lucinations, policies should mandate that every AI-generated output be verified. This includes independently confirming case citations and validating factual assertions against source documents. Transparency and Client Consent Policies should address when and how to inform clients about AI use. This includes updating engagement letters to disclose that the firm uses AI tools to enhance efficiency while maintaining human oversight and con fidentiality. The Illinois Attorney Registra tion and Disciplinary Commission’s Guide to Implementing AI has sample language for client notification and consent. See bit.ly/4260BFL. Continuous Education, Not Just Rules A policy document is useless if no one understands it. Firms must pair their poli cies with mandatory training. Training will not only help reinforce the specifics of the policy, but also provide an opportunity to review appropriate tools, share best prac tices for the use of generative AI, and dis cuss ways the firm can increase efficiency withAI. Sample Law Firm AI Policies When preparing to develop your firm’s AI policy, you will find numerous model policies, sample documents, and guidance materials available to assist you. While these resources offer valuable starting points, it is important to recognize that they may not fully address the unique circumstances of every law firm. They are designed to serve as preliminary frameworks rather than compre hensive solutions. • Implementing an AI Policy: What to Know (Brent J. Hoeft, State Bar of Wisconsin, bit.ly/4teMqua). • Law Firm Acceptable Use Policy for Artificial Intelligence (AI) and AI Policy and Governance Guidance (Texas Bar Practice, bit.ly/422wRcW) • Sample Law Firm GAI Use Guideline/Guidance Policy (American Inns of Court, bit.ly/3QoLKDP) • VBA Model AI Policy for Law Firms (Virginia Bar Association, vba.org/?pg=ai) • Sample Use of GAI Tools Policy (Illi

nois Attorney Registration and Discipli nary Commission, bit.ly/4t4l7m6) • How to Write a Simple Firm Policy on the Acceptable Use of Generative AI for Client Work (LeanLaw, bit.ly/4tdne7j) • Sample Generative Artificial Intelligence Policy (Centerbase, bit.ly/3QEzT4z) • Crafting an AI policy for your law firm: a step-by-step guide (2025 Edition) (Casemark, bit.ly/4syP24K) • Responsible AI Use Policy Outline for Law Firms (JusticeatWork, bit.ly/4cND3L5) • AI Policy Template for Law Firms (Plus Examples) (Darrow.ai, bit.ly/3QmIYim) • Crafting an AI Use Policy: The Essential First Step to Unleashing AI in Your Law Firm (Eve.legal, bit.ly/3Q7MgpM) • Model Artificial Intelligence (AI) Policy for Law Firms (Allrize, bit.ly/4mqAmTS) • Law Firm AI Policy Template, Tips & Examples (Clio, bit.ly/3QmJih4) Conclusion This gap between adoption and over sight exposes firms to significant risks, from data breaches to court sanctions. However, the reaction to banning the use of AI entire ly in a law firm is unrealistic. New lawyers in your firm are receiving training in law school on how to use AI. AI is embedded in most personal and business technology from smartphones to operating systems to search engines to office suites. Some clients may even question whether a firm is lever aging AI tools for efficiency. By implement ing a policy that acknowledges the reality of AI usage while enforcing strict ethical boundaries, firms can turn a potential lia bility into a competitive advantage. n Catherine Reach is the director of the North Carolina Bar Association’s Center for Practice Management. This article, Beyond the Ban: Why Your Law Firm Needs a Realistic AI Policy in 2026, originally appeared on the From the Center blog, published by the North Carolina Bar Association (bit.ly/428fs2u). It is repro duced here with the permission of the author, Catherine Sanders Reach, and the copyright holder, North Carolina Bar Association. © 2026 North Carolina Bar Association. All rights reserved. Any further reproduction or distribution of this material is prohibited without the express written permission of the North Carolina Bar Association.

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THE NORTH CAROLINA STATE BAR JOURNAL