Most coaches these days use an AI notetaker while meeting with clients. And for good reason. You switch it on, it captures what was said, and the only person who sees the transcript is you. They can be incredibly helpful for remembering what was covered during a session, creating summaries for your clients, and picking up where you left off without having to spend another half an hour writing copious notes after every session.
However, a federal judge in California recently made that practice a little more challenging. On August 13th, she allowed wiretap and biometric privacy claims against Otter.ai to move forward, on the theory that the notetaker isn’t the host’s tool at all. Rather, it’s an actual third party in the room with commercial interests of its own. That reframes AI notetaker consent for coaches as a paperwork problem, not a technology problem.
What the ruling actually did, and what it didn’t
On August 13, 2026, Judge Eumi K. Lee of the U.S. District Court for the Northern District of California ruled on Otter.ai’s motion to dismiss a consolidated privacy case. She granted part of it and denied part of it. The claims allowed to proceed include the federal Wiretap Act, California’s Invasion of Privacy Act, two counts under Illinois’ Biometric Information Privacy Act, California’s Unfair Competition Law, and unjust enrichment. Other claims were dismissed, most with leave to amend, including counts under the Computer Fraud and Abuse Act and Washington’s privacy statute.
Let’s be clear about what that means, because a lot of the news coverage hasn’t been. Surviving a motion to dismiss is not a finding that anyone did anything wrong. It means the court decided that if the allegations turn out to be true, they would state a claim the law recognizes. Nothing has been proven. No liability has been established. The case moves toward discovery, and that’s the whole of it.
The four underlying suits (Brewer, Walker, Theus, and Winston) were filed between August and September of 2025 and consolidated. Otter.ai chief executive Sam Liang has said the way the company captures meeting notes is “no different than Microsoft Copilot or Zoom or Google Meeting notetakers.” Setting aside whether that works as a defense or not, as a description of the industry, it’s pretty accurate, and it’s exactly why this isn’t a story about one vendor.
This isn’t just one vendor’s problem
Three other notetakers are facing similar claims right now.
- Fireflies.ai. A December 2025 suit in Illinois alleges its speaker-recognition feature builds and keeps voiceprints without the written notice, retention schedule, and consent Illinois law requires, including from people who never had an account.
- Microsoft Teams. A February 2026 case makes the same voiceprint argument about the speaker-diarization feature that tells participants apart.
- Granola. A July 2026 complaint in California points at Granola’s own marketing line, “Other people in the room won’t know it’s there,” as evidence the product was built to record without announcing itself.
None of that is a verdict on any of these companies. It’s a signal about which product behaviors are being tested in court, and every one of them is a behavior you can check in your own setup this afternoon.
Who’s training on your sessions
The big claim by the plaintiffs in the Otter ruling alleged that the service isn’t simply carrying out the host’s instructions. They alleged it collects, keeps, and uses the conversation for its own commercial purposes, including training its models. The court found that theory plausible enough to move forward.
That’s a big deal. It’s why coaches should pay close attention. Your sessions aren’t sales calls. A client tells you about a marriage, a resignation nobody at work knows about yet, a fear they haven’t said out loud anywhere else. If a vendor is reusing that audio to improve a model, the confidentiality you promised at intake has a third party in it you never introduced.
The vendors differ, and the differences are published. This is where the major tools stand today.
| Tool | Trains on customer content by default? | What it says about notice |
|---|---|---|
| Otter.ai | Yes, after de-identifying audio and transcripts | Puts the duty on you. Users “must always ask for consent and indicate when they are recording” |
| Granola | Yes on Free and Business plans, off by default on Enterprise, with an opt-out in settings | Markets joining meetings without a visible bot |
| Fireflies.ai | Says no, and bars its own vendors from doing it | Business and Enterprise handling set by contract |
| Zoom AI Companion | Says no, without conditions | Since January 2026, participants must acknowledge an AI disclaimer or their mic and camera stay off |
| Microsoft Copilot in Teams | Says no. Prompts and responses aren’t used to train the foundation models | Relies on Teams’ existing recording and transcription banners |
Those two columns answer different questions, and it’s worth not blurring them. “We don’t train on your content” is not the same promise as “we told your client we were recording.” Fireflies makes the first claim and is being sued over the second.
Where your client is sitting changes the answer
Most states let one party to a conversation consent to recording it. Roughly a dozen require everyone’s consent, California and Illinois among them, along with Connecticut, Delaware, Florida, Maryland, Massachusetts, Montana, Nevada, New Hampshire, Pennsylvania, and Washington. The exact list shifts depending on who’s counting and which court has weighed in, so treat it as a prompt to ask, not a map to rely on.
For remote coaching there’s a wrinkle. General call-recording guidance holds that when people are in different states, the stricter rule applies, and it follows the participant rather than you. A coach in a one-party state recording a client who happens to be in Sacramento that morning is working under California’s rule that day.
But you don’t always know where your client is sitting. They travel. They take your call from a hotel, an airport lounge, a parent’s kitchen table. Which is the practical argument for skipping the jurisdiction analysis and simply getting real consent every time.
Illinois adds a separate exposure, because its biometric law counts a voiceprint as a biometric identifier. Collecting one without written notice, a published retention schedule, and written consent carries statutory damages of $1,000 for a negligent violation and $5,000 for an intentional or reckless one, plus attorney fees. A 2024 amendment limits recovery to one award per violation type per person rather than one per recording, which keeps the arithmetic from running away. Still real money for a solo practice.
What consent has to cover before you hit record:
The ICF Code of Ethics already asks for most of this, and it was written to name technology directly. Standard 2.5 commits members to meeting their obligations to clients “directly and through any technology systems I may utilize (i.e. technology-assisted coaching tools, databases, platforms, software, and artificial intelligence).”
Standard 2.4 asks you to store and dispose of electronic records in a way that protects confidentiality and complies with the law. Standard 1.1 puts confidentiality and responsibilities into the initial coaching agreement. Read together, that’s a bar you can clear with one short conversation and one paragraph of paperwork.
- Ask first, out loud, before the recording starts. Permission collected afterward isn’t permission. Say what you’re about to turn on, then wait for the yes.
- Name the tool. “I use Otter for notes” tells your client something that “this call is being recorded” doesn’t. They deserve to know which company is in the room.
- Say what gets captured. Audio, a transcript, or both. Whether the recording itself is kept, or only the notes.
- Say where it goes and how long it stays. Which service processes it, and what your retention window is. If you don’t know your vendor’s retention setting, that’s this afternoon’s homework.
- Say whether the vendor uses it to improve its own systems. Almost nobody mentions this one. After August 13, it’s the one carrying the most weight.
- Make declining easy and free. A client who says no gets the same session, and you take notes by hand. If saying no costs them something, it was never a real choice.
Then write it down. A verbal “yes” doesn’t count as an official record.
The clause to add to your coaching agreement
You don’t need a new contract. You need a paragraph in the one you already use, sitting next to the confidentiality language. It should name the tool, describe what’s captured and how long you keep it, state whether the provider uses session data to train its systems, and give your client a standing right to ask you to switch it off for any session without explaining why.
If your paperwork is thin in general, a recording clause is a good excuse to look at the rest of it. Our free coaching agreement template is a reasonable place to start, and the wider legal setup for a coaching business covers what sits around it. The conversation itself belongs in the first intake session, where you’re already setting expectations about confidentiality.
Life Coaching Agreement
This free Life Coaching Agreement template provides a customizable framework for coaches to establish clear expectations, responsibilities, and terms with their clients, covering essential aspects such as services, payment, confidentiality, and ethical standards.
One thing this post can’t do is tell you whether your setup, in your state, with your clients, is compliant. That’s a question for an attorney who practices where you do, and it’s worth the hour. What this post can tell you is that “I never really thought about it” has stopped being a comfortable answer.
What to do this week
Open your notetaker’s settings and find two things. Whether your data is used to improve the vendor’s models, and how long recordings are retained. Change both if you don’t like the answers. Most of these tools ship with the setting that’s best for the vendor, not for you.
Then open your coaching agreement and see whether the word “recording” appears anywhere in it. For most coaches it doesn’t, and that gap was invisible until a judge in California made it visible.
If you already sorted out your AI disclosure obligations this summer, this is the neighboring problem, not a repeat of it. Disclosure is telling people when they’re dealing with a machine. Consent is asking permission before you record them.
None of this is an argument for turning the tools off. They’re genuinely helpful, and a coach who isn’t looking down, scribbling notes is a coach who’s actually listening. It’s an argument for spending twenty minutes bringing your paperwork up to where your technology already is. Your clients trusted you with the conversation. Asking properly is how you keep deserving it.
