Articles Posted in Lawsuit

What happened? Governor Pritzker established the Illinois AI Cabinet on September 22, 2026. The Cabinet’s mandate includes AI liability, cybersecurity, privacy, contracts, data centers, and whether existing legal remedies are sufficient when AI causes harm.

Who should pay attention? Any Illinois business that uses AI tools in its operations, including hiring software, customer service automation, marketing platforms, contract review tools, data analytics, and scheduling systems.

What should you do right now? You do not need to wait for the Cabinet to issue recommendations to start protecting yourself. The legal risks around AI use are already real under existing Illinois and federal law. Now is the time to audit how your business uses AI and make sure the foundation is solid before new rules arrive.

345B6922-192F-461E-B0F1-863797552788-300x200Two of the largest food companies in America just agreed to pay a combined $87.5 million to settle claims that they conspired to inflate beef prices. If you run a business, the dollar figure is not the lesson. The lesson is how the case got there, and how long it took to surface.

In May 2026, a federal judge in Minnesota gave final approval to settlements in which Tyson Foods agreed to pay $55 million and Cargill agreed to pay $32.5 million to resolve antitrust claims brought by consumers. The claims were part of a sprawling case called In re: Cattle and Beef Antitrust Litigation, and they alleged that major beef processors coordinated to restrict supply and keep prices artificially high. Both companies deny any wrongdoing and settled to avoid the cost and risk of a trial. You can hyperlink Bloomberg Law’s report on the approved settlements and the trade coverage of the court’s final approval for the details.

Here is what every business owner should take from it.

F491983D-A3B1-490C-964F-A8B4EEBB8ED8-300x200Yes, and it already has been, in a criminal arson trial and in a 250 million dollar business dispute, both in 2026. If you’ve ever typed something into ChatGPT that you wouldn’t want read aloud in a deposition, courts are now treating that conversation exactly the way they’d treat an email or a text message. Not private. Not protected. Fully discoverable.

For business owners, this isn’t an abstract technology story. It’s a direct warning about how you and your employees are using AI tools for anything touching contracts, disputes, or business decisions.

The Case That Should Worry Every Business Owner

7E0DCD95-4E0B-48C5-8518-44DD2E8595CE-300x200A doughnut chain, a mortgage servicer, and a payroll processing company have almost nothing in common as businesses. Different industries, different customers, different sizes. But all three ended up in the same place over the past two years: paying millions of dollars to settle lawsuits after hackers got into systems holding ordinary personal information. If you think your business is too small, too unremarkable, or too far outside the tech world to end up in the same position, these three cases say otherwise.

Krispy Kreme: Employee Data, Not Just Customer Data

Krispy Kreme discovered a data breach in November 2024 that exposed the personal information of 161,676 current and former employees, including Social Security numbers, dates of birth, and financial account access details. The lawsuits that followed alleged the company failed to comply with basic data security obligations under the FTC Act and industry standards, and specifically claimed the sensitive information was never encrypted or redacted. Krispy Kreme agreed to pay roughly 1.6 million dollars to resolve the claims.

E9FDF7CF-C7AF-41E7-9053-D86674150EFD-300x200Business partnerships tend to end the way marriages do. Slowly, then all at once, with a moment where trust breaks and someone decides they’re done. The difference is that a business divorce doesn’t come with decades of family law precedent guiding every move. It comes with a company that still has customers, employees, bills, and a bank account, all sitting in the middle of two people who no longer agree on anything.

What you do in the first few days after that moment decides more than most business owners realize. Illinois law offers real remedies for owners who reach an impasse, buyouts, provisional directors, even court appointed custodians to keep a business running through a fight. But those remedies favor the owner who acted carefully, not the one who reacted first. Here are the five moves that tend to do the most damage before a lawyer ever gets involved.

1. Never Lock Your Co-Owner Out of the Business or Its Accounts

2FB66764-EA63-40A0-BC70-666BE8EA9BF1-300x200Yes. It has already happened, and the legal defense you might be counting on, “the AI said it, not us,” has already failed in court.

If your business uses any AI tool that talks to customers, drafts content, or answers questions, whether that’s a customer service chatbot, an AI powered search feature on your website, or a marketing team using generative AI to write copy, you need to understand that your business is legally responsible for what that tool says. Not the AI company that built it. You.

The Case That Should Change How You Think About This

D5CD5B04-0609-4107-B18A-7A2E86931444-300x200For twenty years, “cybersecurity” meant one thing for most business owners: protect the network. Firewalls, endpoint protection, employee training on phishing emails. You knew what you were defending and you generally knew what your insurance covered if you failed.

That model is already out of date.

Attackers have shifted targets. Instead of only breaking into your servers, they are going after the AI tools your business now runs on: the chatbot on your website, the AI agent your vendor plugged into your CRM, the automated workflow that reads your inbox and drafts responses. And the legal and insurance world has not caught up to the speed of that shift, which means a lot of business owners are exposed in ways they do not know about yet.

AEA4DAB5-FF53-459D-A33F-446320D1864C-300x200Generative artificial intelligence is changing pro se litigation. Law.com reports that lawyers and judges see more self-represented litigants using AI to prepare court filings, sometimes effectively and sometimes with serious errors. The increase is also causing courts to reconsider their case-management procedures and the guidance they provide to self-represented litigants. 

A business owner may believe, “My company was cheated, so I can file the complaint myself.” But, if the claim belongs to the company, the owner’s AI-generated complaint may create an unauthorized representation problem before the merits are ever reached.

The Seventh Circuit of the Federal Court recently observed that approximately 60% of its caseload includes at least one self-represented party (pro se litigation). AI did not create pro se litigation, but it has dramatically made it easier to produce a complaint, brief, or motion that looks as though it was prepared by a lawyer.

29C4C306-2FC0-4F13-9F04-03F6A7A4E1D3-300x200The call comes in on a Tuesday afternoon.

It sounds exactly like your business partner. Or your CFO. Or the vendor you have worked with for six years. The voice has the same cadence, the same phrasing, the same slight accent you have always recognized. Maybe there is a video call and the face matches too.

There is an urgent wire transfer. A confidential acquisition. A vendor payment that needs to go out before end of business. The request is unusual but the person making it is someone you know, someone you trust, someone you would wire money for without a second thought.

57F447A8-E5FB-4B8F-96B4-E67FF8E5E436-300x200Your employee is not trying to steal anything.

They are trying to finish a task faster. They paste your pricing model into ChatGPT to reformat it as a client proposal. They upload a draft contract and ask the AI to clean up the language. They feed your source code into the prompt to find a bug. They summarize a confidential internal investigation report to save time writing it up.

None of this feels like a security incident. It feels like using a tool.

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