TheCorporateCounsel.net

The problem of director notetaking during board meetings is a persistent one, and the bad news is that, as Ralph Ward highlighted in a recent issue of The Boardroom Insider, it’s becoming even more challenging to address as AI tools find their way into the boardroom.  This excerpt provides some examples:

In a thoughtful client alert, Robins, Kaplan partner Anne Lockner cites the true-life story of an online board meeting with a member who was logged in, but not actually participating. Instead, he had an online AI assistant sit in to prepare a summary for later review (and later circulation to all participants). While there’s “nothing to prevent participants from taking their own notes, using AI to summarize would be hard to stop,” she says. Still, this situation creates multiple legal nightmares, such as whether the director is actually “attending,” fiduciary duty, and confidentiality of the notes.

Another note-taking tech headache – what if the director is indeed present and participating, but using one of the many transcription tools to take his own minutes/notes of the meeting? While most online meeting platforms give the moderator power to record the session or not (and to prevent participants doing so), using such a capture widget on your own computer (or even on your smart phone) to transcribe would be simple. Of course, this creates an alternate version of the meeting minutes. If preserved, it would be fair game for any legal discovery demand down the road, and could tell a very different tale from that of the approved minutes.

It’s enough to send a shiver down your spine, isn’t it? Anyway, I think every lawyer who has ever counseled a board has a horror story about director notes.  Mine involves a director who wrote a speech opposing a proposed merger that he planned to deliver at the board meeting held to consider it. He ultimately supported the deal, so the speech went undelivered, but he kept it, and it ended up in the plaintiff’s hands. The plaintiff’s lawyer had a very good time with the speech during the director’s 11 hour deposition – the director, well, not so much.

– John Jenkins