The Oregon State Bar issued OSB Formal Opinion 2024-197 in August 2024, providing detailed guidance on AI use in legal practice. Oregon's opinion is one of the more technically precise in the country — it draws a clear line between attorney time reviewing AI output (billable) and AI processing time itself (not billable at attorney rates).
Oregon's approach reflects the bar's tradition of issuing practical, rules-based ethics opinions. The opinion addresses competence, confidentiality, billing, and disclosure with specific reference to Rule numbers and concrete scenarios. For firms operating in Oregon, this opinion eliminates most ambiguity about baseline AI ethics obligations.
What the Bar Says
OSB Formal Opinion 2024-197 (August 2024) establishes that Oregon lawyers using AI must satisfy Rule 1.1 competence requirements by understanding the AI tool's function, limitations, and output characteristics. The opinion explicitly references the risk of AI hallucinations and places the verification burden squarely on the attorney.
The opinion applies Rule 5.3 (supervision of non-lawyer assistants) to AI tools, requiring attorneys to establish review protocols for AI-generated work product. This is a significant framing — it means the same supervisory standards that apply to paralegal work apply to AI output. Attorneys must review, verify, and approve all AI-generated content before submission.
Billing Implications
Oregon's billing guidance is among the clearest nationally. The opinion states: attorneys may charge for time spent reviewing AI output, but may not charge AI processing time at attorney rates. This creates a two-tier billing framework that distinguishes human effort from machine computation.
AI tool subscription costs or per-query charges may be passed to clients as expenses, similar to research database costs, provided the charges are disclosed. The key principle under Rule 1.5: fees must reflect the actual value of attorney work performed. A lawyer who uses AI to draft a motion in 20 minutes and spends 40 minutes reviewing it bills for the 40 minutes of review — not the 20 minutes of AI generation.
Confidentiality Rules
The opinion requires attorneys to ensure AI service providers meet reasonable expectations of confidentiality per Rule 1.6. This is framed through the lens of Oregon's existing rules on outsourcing and third-party service providers.
Practically, this means: evaluate the AI vendor's data handling terms, confirm client data is not used for model training, ensure data is encrypted in transit and at rest, and obtain client consent when the nature of the AI tool's data processing warrants it. Oregon's opinion aligns with the approach taken by California and Washington — treat AI vendors like any other service provider handling client information.
What's Still Unclear
The opinion recommends disclosure but does not mandate it as a standalone ethics obligation. It notes that court-specific requirements may apply and that attorneys should check local rules. This leaves a gap between the bar's recommendation and enforceable obligations.
The opinion also does not address AI in litigation strategy — using AI for case outcome prediction, jury selection analysis, or settlement valuation. As AI applications in legal practice expand beyond document drafting, Oregon will likely need supplemental guidance. The opinion's framework, however, provides a solid foundation for extension.
The Bottom Line: Oregon's formal opinion draws a clear billing line — charge for attorney review time but not AI processing time — and requires vendor confidentiality vetting aligned with Rule 1.6 outsourcing standards.
AI-Assisted Research. This piece was researched and written with AI assistance, reviewed and edited by Manu Ayala. For deeper takes and the perspective behind the research, follow me on LinkedIn or email me directly.