In-House Counsel Solutions Series: 4Q 2026
In-House Counsel Solutions
Four practical legal insights for the year ahead
As 2026 draws to a close, we are sharing four Ideate articles that examine decisions businesses face before and during disputes. From automated customer communications and confidential information to early litigation strategy and everyday marketing content, each article offers a practical way to rethink legal risk. Read the summaries below, then explore the full articles for deeper analysis.
Does Your Company Use Automated Text Messages? Five TCPA Questions In-House Counsel Should Ask
Automated text messaging has become routine business technology. Companies use texts for marketing, appointment reminders, customer notifications, lead follow-up, account communications, promotions, and other interactions. For in-house counsel, the legal risks can be less routine, particularly when a company communicates at scale or relies on third-party marketing platforms.
The Telephone Consumer Protection Act (TCPA) regulates specified calling technologies and telephone-solicitation practices. Depending on the claim and facts, statutory damages may be available for individual violations, with potential enhancement for willful or knowing conduct. Putative class actions can substantially increase the stakes.
A recent appellate development illustrates why different TCPA claims should not be treated as interchangeable. In July 2026, the Seventh Circuit held in Steidinger v. Blackstone Medical Services that text messages are not “telephone calls” for purposes of the private Do-Not-Call action under § 227(c)(5). That decision does not control in the Fifth Circuit, and other TCPA provisions may still apply to texts. Consent, messaging technology, vendor activity, and preserved records remain important.
For companies using automated text technology, in-house counsel should be able to answer five basic questions:
How did we obtain the recipient’s consent?
Can we prove that consent later?
What happens technologically when someone replies STOP or otherwise revokes consent?
Are third-party marketing vendors following the same rules—and preserving the evidence?
If thousands of recipients are involved, can our records distinguish their consent, opt-outs, sources, and communication histories individually?
The practical lesson is straightforward: TCPA defense can begin long before a lawsuit, with the design of the company’s messaging system and the records it preserves.
Read the full article: Defending TCPA Lawsuits in the Northern District of Texas: Claims, Defenses & Damages
Artificial Intelligence and Nondisclosure Agreements: Is Your NDA Ready for AI?
By Mark Stachiw
Nondisclosure Agreements or NDAs are routine in many business and legal activities and are primarily used to protect the disclosing party’s confidential information. However, many companies continue to use form NDAs drafted long before artificial intelligence (“AI”) tools became part of everyday business operations. As a result, many NDAs are silent on whether a recipient may share confidential information with an AI tool, what kind of AI tool may be used, or whether the information may be used to train an AI model. This becomes especially problematic as the use of AI tools and agents proliferate into business operations.
Currently Effective NDAs
When an NDA does not expressly address AI, whether a recipient may use AI tools with confidential information will generally turn on three provisions in the NDA:
Permitted Use. A broad use provision (e.g., “to evaluate a potential transaction”) alone may not prevent a recipient from using all AI tools to evaluate the shared information; while a narrow use, or a restriction on who may use the information, may preclude AI use altogether. Even under a broadly drafted use provision, a strong argument can be made that using confidential information to train an AI model is outside the permitted use.
Permitted Recipients. If confidential information may be shared only with individuals who have a need to know, an argument can be made that an AI tool is not such an individual. On the other hand, if the class of permitted recipients is broad (e.g., “agents, contractors, and other representatives”), that argument becomes harder to make. Even then, however, an argument can be made that an AI tool is different than the other enumerated permitted recipients.
Return or Destruction. Information uploaded to an AI tool may persist in prompt histories and provider systems and, if used for training, may effectively become part of the model itself – making compliance with a return or destruction obligation difficult or impossible.
Even where these provisions do not preclude AI use, the general nondisclosure obligation will likely still preclude the use of public AI tools (e.g., free or consumer chatbots), whose terms often permit the provider to retain inputs or use them for training. This means that counsel should advise clients not to use public AI tools with third-party confidential information, and to disable any settings that would permit third-party confidential information to be used to train their enterprise AI models.
Form NDAs
Counsel should also update their form NDAs to provide that confidential information may not be (1) shared with AI tools that do not protect its confidentiality, (2) used in a manner that could result in its reverse engineering, or (3) used to train any AI model. At a minimum, the NDA form should include language similar to the following:
Notwithstanding anything to the contrary in this Agreement, Recipient shall not input, upload, share, copy, or otherwise transfer any Information into any artificial intelligence or machine learning (“AI”) tool, agent, platform, or service, including, but not limited to, generative AI models, AI agents, meeting transcription tools, AI summarization tools, and chatbots (collectively, “AI Tools”), unless such AI Tools are: (a) provided under an enterprise or business license, and not a free or consumer version; and (b) subject to (i) terms that expressly prohibit the use of such Information for model training or improvement, and (ii) confidentiality and data security obligations that are at least as protective as those set forth in this Agreement.
Adding An Additional Disclaimer
Disclosing parties should also add an AI-use restriction to the confidentiality legend on their documents similar to the following:
Without the express prior written consent of the disclosing party, the confidential information contained in this document may not be (A) used with or shared with any artificial intelligence tool, agent, or model that does not protect the confidentiality of the information contained herein, or (B) used to train or develop any artificial intelligence or machine learning model.
While a legend generally will not expand obligations under an existing NDA, it puts the recipient on notice of the disclosing party’s expectations.
What Should Companies Do Now?
Review currently effective NDAs, prioritizing those covering highly sensitive information, for provisions that limit AI use.
Update form NDAs to expressly address AI tool use and model training.
Adopt or update an AI acceptable-use policy that prohibits entering third-party confidential information into public AI tools.
Update confidentiality legends to include an AI-use restriction.
Read the full article: AI Nondisclosure Agreements: Is Your NDA Ready for AI?
Your Litigator’s Tactical Toolkit: Part Two, The Motion to Dismiss
By Brian Casper
In the first installment of this series, we discussed ways litigation can end before trial. One of the earliest potential exit ramps is a motion to dismiss. Properly used, it can narrow a lawsuit or dispose of legally deficient claims before the parties incur the expense of extensive discovery.
A motion under Rule 12(b)(6) generally tests whether a complaint states a legally sufficient claim, assuming its well-pleaded factual allegations are true. The court ordinarily evaluates the pleadings and materials it may properly consider at that stage, rather than resolving disputed facts. A missing element or legal bar may justify dismissal even before discovery begins.
A carefully drafted complaint can make legal deficiencies difficult to spot. The briefing may need to distinguish factual allegations from conclusions and identify missing elements or statutory prerequisites. Specialized areas such as intellectual property law can present particularly important pleading questions.
Federal Rule of Civil Procedure 8 generally calls for a short and plain statement of jurisdiction, a claim showing entitlement to relief, and a demand for relief. Under the plausibility standard, however, factual allegations must do more than merely suggest a speculative possibility of liability.
Some claims also face heightened pleading standards or specific prerequisites. Whether a complaint meets those requirements is a separate question from whether the plaintiff will ultimately prove the facts alleged.
Some deficiencies can be cured through amendment. Others cannot. A motion is more attractive when the challenged claim has a legal defect that additional factual allegations are unlikely to repair. That difference matters: a successful motion that merely produces a revised complaint may do little to reduce the overall cost of litigation.
Conversely, a well-pleaded complaint, or one whose defects can readily be cured, may be a poor candidate for an early motion. The likely opportunity to amend should be considered alongside the legal arguments and the court’s procedures.
A motion to dismiss is not a magic wand. It is a tactical tool. The decision to file should balance the strength of the arguments, briefing expense, potential delay, likelihood of amendment, and possible savings from narrowing or ending the case. In-house counsel should ask not only whether the motion can succeed, but whether it advances the company’s litigation objectives.
Read the full article: Motion to Dismiss Strategy: When an Early Exit Makes Sense
A $200 Copyright Judgment After Years of Federal Litigation
A single photograph in an ordinary marketing post can create litigation expense dramatically out of proportion to the image’s value.
Prepared Food Photos sued NOFAL, LLC, which operated Food Town Mart, after a photograph of raw pork chops appeared on the store’s Facebook page. Following a two-day federal jury trial, the jury found copyright infringement but no willfulness, rejected the fair-use defense, and determined that $200 fairly compensated the copyright owner for its actual damages. The copyright owner elected the $200 actual-damages award.
The more important number may be everything surrounding that $200 judgment. The case began in 2022, proceeded through a jury trial and post-trial proceedings, and ultimately generated competing attorney-fee requests totaling $119,505: $69,255 requested by the copyright owner and $50,250 requested by the individual defendant, who defeated the vicarious-liability claim. In March 2026, the court denied both fee motions and ordered each side to bear its own costs.
For in-house counsel, the case highlights an operational risk. Employees, agencies, freelancers, website developers, and social-media teams may publish many images without retaining reliable records of their sources or the rights obtained to use them.
The answer does not require legal review of every social-media post. A better approach is operational: establish approved image sources, retain licensing records, address third-party content in vendor agreements, and create a straightforward escalation process for unusual uses. AI-generated images belong in the same governance process rather than being treated as automatically risk-free.
The practical objective is simple: know where marketing content came from and be able to prove why the company had the right to use it.
Read the full article: One Image Can Create a Copyright Problem: What Businesses Should Know Before Using Photos in Marketing by Darin M. Klemchuk, CEO, Member and Founder.
Read the full article: One Image Can Create a Copyright Problem: What Businesses Should Know Before Using Photos in Marketing
For additional Ideate insights, visit Klemchuk’s website. We welcome suggestions for future issues addressing strategic legal and business decisions facing in-house counsel.
Klemchuk PLLC is a leading IP law firm based in Dallas, Texas, focusing on litigation, anti-counterfeiting, trademarks, patents, and business law. Our experienced attorneys assist clients in safeguarding innovation and expanding market share through strategic investments in intellectual property.
This article is provided for informational purposes only and does not constitute legal advice. For guidance on specific legal matters under federal, state, or local laws, please consult with our IP Lawyers.
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