Legal & Contractual Risk

AI introduces legal risks at multiple levels, from the contracts you sign with AI vendors to the products and services you deliver to your own customers. Vendor contracts need careful attention to data rights (who owns the data you provide, and can the vendor use it to improve their models?), liability allocation (what happens when the AI produces incorrect or harmful outputs?), and service continuity (what are your rights if the vendor changes the product, raises prices, or shuts down?). On the customer-facing side, using AI in your products creates potential liability for the accuracy and reliability of AI-generated outputs, obligations to disclose AI use, and risks around making claims that AI-powered features can't consistently deliver. Many standard commercial contracts weren't drafted with AI in mind, and terms that work fine for traditional software can leave significant gaps when AI is involved. Getting legal review of both vendor contracts and customer-facing terms is essential, with particular attention to data usage rights, liability caps, indemnification provisions, and what happens when things go wrong. Don't assume that standard terms are adequate.