An Attorney's Ethical Obligations to the Client in Third-Party Funded Litigation
Lori Ding
The landscape of legal practice has significantly changed due to the proliferation of third-party litigation funding, a financial mechanism that provides capital to plaintiffs, including patent owners, in exchange for an interest related to any recovery. This funding source can be a vital tool for expanding access to justice, particularly for patent owners who would otherwise be unable to afford the high costs of patent litigation, but it introduces several dynamics that require careful ethical consideration from attorneys. After assessing an attorney’s ethical duties of loyalty to the client and client control, attorneys can examine how they are applied and safeguarded in the context of litigation funding, and analyze how state bar ethics opinions and judicial interpretations are guiding attorneys in this evolving field.
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Our Take on AI: September 2025
South Korea Issues AI Copyright Guidance: South Korea's Ministry of Culture, Sports and Tourism and the Korea Copyright Commission released two guides on AI and copyright. The guidance clarifies that purely AI-generated outputs are not eligible for copyright protection because they lack the required human creative input. However, works created using AI as a tool can be registered if a human makes a significant creative contribution through selection, arrangement, or modification. When registering such works, applicants must clearly distinguish between the human-created portions and the AI-generated parts. The guidance also focuses on preventing copyright disputes, offering practical advice for rights holders, AI users, and AI businesses to mitigate infringement risks. Nick Palmieri writes more about this development here: "South Korean Copyright Office Issues AI Guidance."
White House Releases "America's AI Action Plan": On July 23, 2025, the White House unveiled America’s AI Action Plan, a strategy aimed at securing U.S. leadership in artificial intelligence. The plan is built on three pillars: accelerating AI innovation, building robust AI infrastructure, and leading in international AI diplomacy. Key initiatives include removing federal regulations that hinder AI development, promoting open-source AI models, revitalizing domestic semiconductor manufacturing, and streamlining permitting for data centers. The plan also signals a new federal approach to state-level AI laws, indicating that federal funding may be directed away from states with what are deemed to be overly restrictive AI regulations. You can read more about this development here: "President Releases 'America's AI Action Plan'."
French DPA Provides GDPR Guidance for AI: France's data protection authority, the CNIL, has published recommendations to help organizations ensure AI systems that process personal data comply with the GDPR. The guidance focuses on the development phase of an AI system, outlining key compliance steps before a model is trained or deployed. Core recommendations include defining a specific and legitimate purpose for data processing, adhering to the principle of data minimization, establishing a valid legal basis for processing data (e.g., legitimate interest or consent), ensuring transparency with data subjects, and conducting Data Protection Impact Assessments (DPIAs) to mitigate risks. You can read more about this development here: "CNIL Published Recommendations on Application of GDPR to Artificial Intelligence."
August 2025 Intellectual Property Report Recap
In case you missed it, here is a link to our August 2025 Intellectual Property Report.
