AI Docs Sent by Exec to Attys Not Privileged, Judge Says

3 months ago

Former Beneficient CEO Bradley Heppner faces trial on fraud and lying to auditors charges.
Heppner allegedly looted GWG Holdings, leading to $1 billion in investor losses before its bankruptcy.
Heppner denies guilt, claiming the indictment unfairly blames him for the bankruptcy.
Heppner used an AI tool to prepare 31 legal documents in 2025 after knowing he was a law enforcement target.
The government argues these AI-generated documents should not be protected by attorney-client privilege or work-product doctrine.
Judge Rakoff ruled the AI documents are not protected as they were not prepared by attorneys and the AI tool's terms negate confidentiality.
Defense raised concerns about a potential 'witness-advocate conflict' if prosecutors use AI-generated documents at trial.
Judge Rakoff is considering a defense motion to dismiss a count against Heppner for being time-barred.
Next court date scheduled for April 2.

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