Otter.ai Faces Class-Action Lawsuit Over Alleged Privacy Violations in AI-Powered Transcription Service

Reviewed byNidhi Govil

5 Sources

Share

Otter.ai, a popular AI transcription tool, is facing a class-action lawsuit for allegedly recording and using private conversations without proper consent, potentially violating federal and state privacy laws.

Otter.ai Faces Legal Challenge Over Privacy Concerns

Otter.ai, a popular AI-powered transcription service, is at the center of a federal lawsuit alleging significant privacy violations. The class-action complaint, filed in the U.S. District Court for the Northern District of California, accuses the company of recording and utilizing private conversations without obtaining proper consent from all participants

1

2

3

.

Source: PC Magazine

Source: PC Magazine

The Allegations

The lawsuit focuses on Otter's "Otter Notetaker" feature, which provides real-time transcriptions for virtual meetings on platforms like Google Meet, Zoom, and Microsoft Teams. According to the complaint, Otter allegedly:

  1. Recorded conversations of both account holders and non-subscribers without explicit consent

    1

    2

    .
  2. Failed to disclose when the service was active and recording meetings

    1

    .
  3. Used recorded conversations to train its machine learning technology without informing participants

    3

    4

    .

Legal Implications

The plaintiff, Justin Brewer, claims that Otter's practices violate several laws, including:

  • The Electronic Communications Privacy Act of 1986
  • The California Invasion of Privacy Act
  • The Computer Fraud and Abuse Act

    1

    2

    5

The lawsuit argues that by not seeking permission from all meeting participants, Otter effectively "wiretapped" their communications

1

4

.

Otter's Response and Privacy Policies

Otter.ai has stated that it does not initiate recordings independently and that its Terms of Service require users to obtain necessary permissions

3

. However, the lawsuit contends that Otter is attempting to shift responsibility onto its account holders rather than fulfilling its legal obligations

2

.

The company's privacy policy mentions that audio recordings are "de-identified" before being used for AI training. However, the complaint questions the effectiveness of this process and cites research challenging such anonymization techniques

1

5

.

Broader Industry Implications

This lawsuit highlights growing concerns about privacy in the age of AI and remote work technologies. Some key points include:

Source: NPR

Source: NPR

  1. The University of Massachusetts banned Otter.ai in 2024 due to similar privacy concerns

    1

    .
  2. Competitors like Read.ai allow any participant to stop recording during a meeting, emphasizing the importance of user control

    1

    .
  3. The case raises questions about the responsibilities of tech companies in obtaining consent and protecting user privacy

    2

    3

    4

    .

Financial and User Impact

Otter.ai has experienced significant growth, reaching over 25 million users and surpassing $100 million in annual recurring revenue

2

3

. The lawsuit suggests that the company obtains financial benefits from its alleged practices, potentially at the expense of user privacy

2

5

.

Source: Mashable

Source: Mashable

As the legal proceedings unfold, this case could have far-reaching implications for AI-powered transcription services and the broader landscape of privacy in digital communication tools.

TheOutpost.ai

Your Daily Dose of Curated AI News

Don’t drown in AI news. We cut through the noise - filtering, ranking and summarizing the most important AI news, breakthroughs and research daily. Spend less time searching for the latest in AI and get straight to action.

© 2025 Triveous Technologies Private Limited
Instagram logo
LinkedIn logo