The AI on the Other End of the Line Could Be Breaking the Law. Here's Why.

The next time you call a company for support, the artificial intelligence system assisting you—or replacing a human agent altogether—might be doing more than just helping. According to a surge of new lawsuits, it could be engaged in illegal wiretapping.

Courts are now facing a high-stakes legal battle that pits privacy laws from a bygone era against the cutting-edge AI technology that is rapidly transforming customer service. A growing number of consumers are suing major corporations, alleging that the AI “listening in” on their conversations constitutes a criminal act.

At the heart of this conflict is a technology known as “conversation intelligence.” Deployed by tech giants like Google LLC and specialized firms such as Invoca Inc. and ConverseNow Technologies Inc., this AI can analyze customer calls in real time. It might feed instant suggestions and scripted responses to a human agent or, in many cases, manage the entire interaction on its own. Plaintiffs in these cases argue that this amounts to an unannounced third party secretly recording the call, a direct violation of federal and state wiretapping statutes.

A Legal Floodgate Opens

This isn't just a handful of isolated complaints. The legal challenge is gaining serious momentum. Since 2023, at least a dozen such lawsuits have been filed across the country. In the first few months of this year alone, the U.S. District Court for the Northern District of California—a key battleground for tech litigation—has seen at least five new cases.

The lawsuits lean on powerful, decades-old legislation like the federal Wiretap Act and the California Invasion of Privacy Act (CIPA). These laws were written long before AI was a part of daily life, creating a legal gray area that courts are now forced to navigate for the first time.

The central question is a complex one: Does an AI system that processes a conversation count as an “eavesdropper” in the same way a human would? The success of these lawsuits hinges on how judges interpret technical legal definitions in the context of this powerful new technology.

The outcome of these cases will have massive implications. A ruling in favor of the plaintiffs could force a dramatic overhaul of how companies use AI in customer interactions, potentially setting a powerful new precedent for digital privacy in the age of artificial intelligence. For now, the question remains: is that helpful bot a convenient assistant or an illegal spy?