AI notetaking privacy has become a live issue in federal court, and Illinois lawyers who use these tools should pay attention. In August 2026, a federal judge in California largely allowed a class action against Otter.ai to move forward. The plaintiffs claim Otter’s AI notetaker joined virtual meetings, recorded people who never agreed, and kept their words to train its AI models. Three of the seven plaintiffs live in Illinois, where their claims are built on a state law that treats a voiceprint much like a fingerprint.
Many lawyers already use AI notetakers on Zoom and Teams calls that include clients, opposing counsel, and experts who never signed up for the tool. The ruling does not find that Otter broke any law, but only means the claims were pleaded well enough to continue. Still, the court’s reasoning shows how a convenient tool can create real privacy exposure for anyone who invites it into a meeting.
What the Otter.ai Lawsuit Alleges
The Otter.ai privacy litigation case is being heard in the U.S. District Court for the Northern District of California. On August 13, 2026, Judge Eumi K. Lee issued an order granting Otter’s motion to dismiss in part. Otter sells transcription services, and its Otter Notetaker joins meetings on platforms like Zoom and Microsoft Teams. According to the plaintiffs, the tool acts as a “silent participant,” recording and transcribing conversations in real time without consent from everyone on the call. Those conversations, along with voiceprints and other personal data, are allegedly stored by Otter and used to train its speech recognition and machine-learning models.
For Illinois readers, the voiceprint claims stand out because of the Biometric Information Privacy Act (BIPA). Two Illinois plaintiffs met with financial professionals over Zoom, while a third used several platforms for business planning, performance reviews, and client discussions. Each says Otter captured their voiceprint during these meetings. Speakers are tagged in real time, using Zoom participant names or data that Otter’s customers enter. Through that process, Otter allegedly builds a “speaker identification profile” so it can recognize the same person in future meetings. Notably, these participants were not Otter customers but simply joined calls where someone else turned the tool on.
Why the AI Notetaking Privacy Claims Survived
Otter asked the court to dismiss the entire case, but the court denied that request for most of the claims. Otter argued that the plaintiffs suffered no real injury and that its notetaker was an invited meeting guest, not an eavesdropper. The judge disagreed, comparing the alleged recordings to intrusion upon seclusion, a long-recognized privacy harm.
Four parts of the ruling stand out for lawyers:
Voiceprints: Voiceprints were found to be biometric identifiers under BIPA. The plaintiffs plausibly alleged that Otter collected them without written notice or a signed release, and without a public retention and destruction schedule.
Location: Otter argued that BIPA could not reach it, but the court disagreed because the Illinois plaintiffs were in Illinois when their data was collected.
Federal Wiretap Law: Otter claimed it was a party to each meeting. That defense may fail if the recording served a tortious purpose, such as training AI for profit.
California Eavesdropping Law: A vendor that only serves its customer is usually treated as that customer’s tool. Otter allegedly kept and used the data for itself, which could make it a third-party eavesdropper.
Not every claim survived, though. Labels like “private” or “sensitive” were not enough on their own to show a reasonable expectation of privacy. By contrast, claims survived for a plaintiff who discussed medical information with a provider.
The judge also refused to assume that a visible notetaker means participants agreed to be recorded. BIPA raises the financial stakes, allowing $1,000 in liquidated damages for each negligent violation and $5,000 for each intentional one.
AI Risk Management Questions for Illinois Law Firms
The ruling targets a vendor, not the people who used its product, yet lawyers who bring AI notetakers into client meetings face their own questions. Under Illinois Rule of Professional Conduct 1.6(e), lawyers must make reasonable efforts to prevent unauthorized disclosure of client information. A tool that keeps recordings to train its own models may sit uneasily with that duty.
Client meetings often cover the same topics the court treated as sensitive, since medical history, finances, and business strategy come up in many practice areas. Once those conversations are sent to an outside vendor, control over where the information goes may be lost. Notetakers join a growing list of AI legal risks facing Illinois lawyers.
Firms should learn how a notetaker vendor uses captured data for its own purposes, which means talking directly with the vendor instead of only reading the contract. The value a tool adds should also be weighed against the risk it creates.
Other common questions include whether the tool turns on by default, whether every participant can see it recording, how long transcripts are stored, and whether the firm can opt out of model training. When a written AI notetaker policy is adopted, lawyers and staff can answer these questions consistently.
AI Notetaking Privacy and the Duty of Confidentiality
The Otter.ai case remains at an early stage, and the plaintiffs were given a chance to amend the claims that were dismissed. No court has found that Otter violated BIPA, federal wiretap law, or California privacy law. Even so, the ruling offers an early look at how courts may handle AI notetaking privacy disputes. Voiceprints count as biometric data in Illinois. A vendor that keeps recordings for its own use may lose the defense that it was only a meeting participant. The more sensitive the conversation, the stronger a privacy claim becomes.
For lawyers, the lesson reaches well beyond one vendor, because client trust depends on confidentiality and every new tool in a meeting creates another path for information to travel. Reviewing how these tools collect, store, and use data before they join a client call is part of sound law firm risk management.
For risk management guidance pertaining to AI notetaking tools, contact the professional liability team at ISBA Mutual Insurance Company.
