California SB 574 Is Law: What Your Firm Must Do Before January 1, 2027

California SB 574 Is Law: What Your Firm Must Do Before January 1, 2027

Governor Newsom signed California SB 574 on September 30, 2026. The bill that passed the California Senate 39-0 in January and cleared both chambers before the session closed is now the first US state statute to codify personal-verification standards for attorneys using AI in legal practice.

California attorneys now have until January 1, 2027 to comply. That is approximately 90 days.

This piece is the action guide. If you want background on what SB 574 covers and how it differs from California's COPRAC ethics amendments, start with our full breakdown. If you want to understand what the signing means specifically versus what a veto would have meant, see our companion piece. This guide is for the attorney who already understands the stakes and wants the compliance checklist.

What SB 574 Actually Requires of California Attorneys

SB 574 creates four statutory obligations for California attorneys using generative AI in legal practice.

1. Personal citation verification

Before any AI-generated citation goes into a court filing, the signing attorney must verify it personally. The case must exist. The quoted passage must appear verbatim in the original document. The citation must still be good law — not overruled or narrowed on the point being cited. And the attorney who signs the filing must run that check — not a paralegal, not the AI, and not another AI tool.

"I ran the AI's citations through a citation-checker AI" does not satisfy a personal-verification standard under SB 574. Westlaw or Lexis, checked by the signing attorney, is what the statute requires.

The courts had already been signaling this standard through sanctions before SB 574 became law. AI citation sanctions exceeded $145,000 in Q1 2026 alone. Two Oregon attorneys paid $110,000 in a single matter. A Nebraska attorney was suspended indefinitely. SB 574 adds a statutory violation on top of bar discipline for California attorneys who skip this step.

2. Confidential client data stays out of consumer-grade AI

Attorneys cannot input sensitive client information — Social Security numbers, dates of birth, driver's license numbers, and other personally identifying information — into public or consumer-grade AI systems. If your attorneys are using personal ChatGPT accounts, Gemini without an enterprise subscription, or Claude without a privacy-compliant enterprise plan for client matters, that practice ends. This was already required under COPRAC Rule 1.6. SB 574 makes it a statutory obligation with civil liability exposure on top of bar discipline.

3. No delegating the practice of law to AI

SB 574's most ambiguous provision remains ambiguous even after signature. The prohibition against delegating "the practice of law" to generative AI does not define what that means for AI purposes — courts have wrestled with that definition in unauthorized practice disputes for decades. California courts will now define it in the AI context, which means there will be test cases, and the litigation timeline is uncertain.

The safest posture for a law firm using AI-assisted drafting: document that the attorney exercises independent professional judgment over every final work product. Reviewing and approving AI output wholesale — rubber-stamping AI drafts without meaningful attorney analysis — is the behavior most at risk under a broad reading of this clause.

4. Anti-discrimination compliance

Attorneys must ensure AI use does not produce unlawful discrimination based on protected characteristics. If an AI tool generates recommendations with disparate impact on a protected class, and you act on them, the legal exposure is yours. For most small law firms, the practical implication is awareness — understand what your AI tools are doing and be alert to outputs that raise discrimination concerns.

Effective Date and Compliance Timeline

SB 574 takes effect January 1, 2027. There are no obligations that are immediate upon signing — the 90-day implementation window is your compliance runway. Use it.

Date	Milestone
September 30, 2026	SB 574 signed — statute enacted
October 31, 2026	Target: written citation verification protocol complete
November 30, 2026	Target: updated engagement letters and AI workflow documentation
January 1, 2027	Statute takes effect — all four obligations are legally enforceable

If January 1 arrives and you do not have a written citation verification protocol, updated engagement letters, and documented AI workflows, you start the year out of compliance.

Three Actions California Law Firms Should Take This Month

1. Write your citation verification protocol this week.

One page. Four steps. Every attorney who signs court filings must follow it before any filing that includes AI-generated research or drafting:

1. Search each AI-generated citation in Westlaw or Lexis.
2. Confirm the quoted passage appears verbatim in the source document.
3. Confirm the case has not been overruled or narrowed on the cited point.
4. Log the verification in a matter note: date, initials, tool used.

This takes 15 minutes for a filing with five citations. Write it, circulate it to every attorney and paralegal who touches litigation, and document that you follow it. Under COPRAC Rule 3.3, this is what competent citation practice with AI already looks like. Under SB 574, it satisfies the statutory personal-verification requirement. A documented verification protocol is the difference between a defensible compliance posture and exposure. Write it this week — not in November.

2. Audit which AI tools your attorneys are actually using.

Not which tools you have approved. Which tools they are actually using, for which tasks, and whether any of those tools involve entering client data.

Walk through three questions for each tool:

• Is this a consumer-grade or enterprise-privacy-compliant version?
• What client information could enter this tool?
• Does the attorney review and exercise independent judgment over the output, or does the output go out with minimal modification?

If an attorney is using a free personal ChatGPT account for any client matter work, that tool comes off the approved list. If AI-generated drafts are going out with light touch-ups but no meaningful attorney analysis, your "no delegation" posture is at risk.

3. Update your engagement letter.

Add one sentence: "Our firm uses AI tools to assist with legal research, drafting, and document review. All AI-assisted work is reviewed and verified by a licensed attorney before delivery."

If you want fuller coverage: "We do not input your personally identifying information — including Social Security numbers, dates of birth, or driver's license numbers — into publicly accessible AI systems."

Engagement letters already signed do not need retroactive updates. But updating your template now protects every new matter you open before January 1. If you have not added AI disclosure language yet, the engagement letter template in our compliance hub gives you the language you need. COPRAC Rule 1.4 already required disclosure of material AI use. SB 574 signed raises the stakes for missing it.

What This Means for Out-of-State Firms with California Bar Admission

SB 574 applies to California-licensed attorneys, not California-based firms.

If you hold a California bar admission and practice anywhere in the United States — from a Dallas office, a remote setup in Colorado, or a two-attorney firm in New Jersey — SB 574 applies to your practice. The statute governs the attorney's license, not the firm's location.

If you are a firm without California-admitted attorneys, SB 574 does not directly apply yet. But California has 260,000 licensed attorneys — the largest state bar in the US — and SB 574 is now the first statutory AI compliance framework for attorneys in the country. The template is written. New York, Texas, Florida, and Illinois have all been watching the California process closely. If you are not a California-admitted attorney today, you may be operating under a similar statute within 12 to 24 months.

The time to build compliant AI workflows is before your state legislature acts.

Your Action Before January 1

Write your citation verification protocol this week and send it to every attorney in your firm. Every California attorney who signs court filings that include AI-assisted research or drafting is now operating under a statute. A four-step written protocol, distributed and followed, is the difference between a documented compliance posture and a preventable exposure.

If you are not sure where to start, use the four steps above, format them as a one-page firm standard, and get it signed off by your managing partner this week.

January 1 is close enough that "we will get to it" is now a risk strategy, not a plan.

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For ongoing compliance guidance as SB 574 implementation develops — including how courts begin to define "the practice of law" in the AI context — subscribe to The Crossing Report, weekly AI intelligence for professional services firm owners.

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Sources: California Legislative Information, SB 574 bill history (leginfo.legislature.ca.gov); California State Bar COPRAC AI ethics amendments (2026); Artificial Lawyer; ComplexDiscovery AI sanctions tracker Q1 2026.