Examining the Changing Legal Landscape for Associations

In this episode of Associations NOW Presents, guest host Tom Arend, Jr., Esq., CAE, CEO of the American Academy of Orthopaedic Surgeons, speaks with Jerry Jacobs, Esq., partner at Pillsbury Winthrop Shaw Pittman LLP, about three major issues facing associations today: artificial intelligence, DEI, and misconduct at events. They explore why many organizations are adopting AI cautiously and the importance of guardrails, institutional licenses, and transparency when meetings are recorded or summarized. Jacobs also discusses legal considerations around DEI programs amid increasing scrutiny and evolving interpretations of civil rights law. The conversation concludes with a look at rising concerns around inappropriate behavior at events and why clear policies and enforceable codes of conduct are essential for associations.

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https://youtu.be/6YBt9suvV2U

 

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Transcript

Tom Arend, Jr., Esq., CAE: [00:00:00] Welcome to this month's episode of Associations NOW Presents, an original podcast series from the American Society of Association Executives. I'm Tom Arend, CEO of the American Academy of Orthopedic Surgeons. Prior to serving as CEO, I was also general counsel of a large association. And prior to that, I served as a practitioner in the association law space in Washington DC.

Joining us today, we're excited to welcome Jerry Jacobs. Jerry is a partner at the firm of Pillsbury Winthrop Shaw Pitman, LLP. Jerry has for decades been recognized as the dean of the association law world, both in Washington and across the country. He is a frequent commentator, author, contributor, and speaker on association law topics, and recently came out with the seventh edition of the Bible of association law, the Association Law Handbook.

Welcome Jerry. 

Jerry Jacobs, Esq.: Hi, Tom. 

Tom Arend, Jr., Esq., CAE: So there's a lot going on in the [00:01:00] world right now, but we're gonna try and focus primarily on three topics. First topic has to do with the use of artificial intelligence in associations and by associations. Then we'll move on to the impact of diversity, equity, inclusion in associations, and particularly the recent changes in the federal law and the sort of broader federal posture with respect to the use of diversity, equity, inclusion in governance and decision making by associations.

Finally we’ll turn to another topic that causes a lot of angst among association executives, which is bad behavior among staff, among members, and among others in the association space, and how associations can most effectively deal with those situations. So in the area of artificial intelligence, actually, particularly today, here we are.

In the third week in February, 2026, and we're [00:02:00] reading today, yesterday, over the weekend, doom and gloom scenarios around the use of AI from a number of consulting firm newsletters and other experts in the field, and AI is clearly becoming a very complex, difficult issue for everyone to deal with. How in particular do you see artificial intelligence impacting associations, Jerry?

Jerry Jacobs, Esq.: It's gonna affect us all sooner than later, from everything that I can understand. Last year we had a role in the transition of what's arguably the leading AI company in the United States and the world Open AI from its historic founding as a public charity to more emphasis on a taxable business corporation.

And I had a chance to look on the inside of the workings of a large AI company. And what I learned is that it's being utilized with new creativity and new efficiency in different ways by different [00:03:00] users. The association community, almost by definition, is a person-to-person field. There's advocacy, which is often one-on-one.

There's professional education that's often very personalized. There are communications networking that's always personal, and so I'm wondering whether AI is moving more slowly into the association community than elsewhere because of the personalization required to be successful in association management. But we're seeing association clients use it effectively for preparing content, for communications, for summarizing meeting discourse, for cleaning or mining long lists of members, prospects, vendors, et cetera.

And we've seen some. Fairly creative, but so far very limited uses by comparison as lawyers in the [00:04:00] law firm community, we're going headlong in use of ai and I'm not seeing that as often among associations. 

Tom Arend, Jr., Esq., CAE: Yeah, I would agree with that. What I've seen both personally within the association that I work for and some of my other colleagues experiences in the last, I would say three to four years, is a, a slightly slower adoption than in some other spaces in the commercial area. But I do see that accelerating significantly, and I see both use cases internal to operations and management of an association, almost similar to any other large organization and then external use cases. And maybe we can talk about those.

I think in both cases, it's important at the beginning to set some guardrails, to set some policies and procedures, some very clear expectations about how it's going to be used by your internal staff. For example, in our case, initially, I recall we had different groups [00:05:00] using different platforms. We'd have one, the marketing group, for example, maybe using anthropic, and you'd have the finance folks using ChatGPT, and you'd have the comms people using something else.

And we ultimately got to a space where we said, hey, we've got to figure out, first of all, a uniform tool that we're all gonna use, that we all can become conversant on. And then importantly, we'll all have a corporate license for and we can use appropriately. And that ideally will help us better integrate what we're doing across the organization in ai.

And is that, what are some of your thoughts on setting up those appropriate? 

Jerry Jacobs, Esq.: That actually makes sense. You're providing computers and in many cases, ipads and phones to employees. So you have every right to restrict what apps and software are used on those machines. And many organizations are picking one or two buying institutional licenses, which will sometimes allow confidentiality of use of these tools, which is a, [00:06:00] a big advantage.

And yes, everybody is struggling with “What are our policies going to be?” A continuing question is what about members who wanna use AI to summarize meetings they attend? Yeah. Whether governance meetings or educational content meetings. I would think that in our experience so far, we see more associations come down on the side of denying and forbidding politely and diplomatically use of meeting summary AI tools by attendees simply.

Because it's better to have one official record of what happened, especially at governance meetings. But I really appreciate that the exigency of membership relations, you may not be able to hold out. The members may just demand it. And I have seen some pretty darn good summaries of meetings produced by these programs.

Tom Arend, Jr., Esq., CAE: Yeah, that's an interesting case. And that's exactly a case [00:07:00] that you can compare to. This is the new technology we have. In some ways, the outcome of that technology is not a lot different in kind than the outcome. Twenty years ago we said, oh, can we record this meeting? Can we do an audio recording of this meeting?

And for the reasons you articulated well, we don't necessarily wanna have, we don't wanna killl the debate among board members or committees or what have you, by them thinking, oh, some somebody's gonna look at, listen to this in three weeks or three months, and maybe I misspoke and I didn't correct it.

And to your point, we want the minutes to be the official record. And so that, my recollection is the universal recommendation would be no, you shouldn't record meetings as a general rule now. I agree with you and just I see the progression that we've taken and some of my other colleagues and other associations, almost every call I'm on it.

We just automatically record it. And the governance people, the staff people use that summary to then [00:08:00] create their own summary and then a set of minutes and it's just become so easy, not error free, to your point, it's always critical to review, have a human. Review everything, but it's hard to stand in the way of that progress from a governance entity.

Jerry Jacobs, Esq.: That's absolutely correct. And one final point, if we're gonna move on to another subject, we can't remind users often enough that right now AI's programs all hallucinate, they all make up. And, and so to develop something based just on AI and send it out to the members and find that a key fact or even an insignificant fact is just incorrect, will embarrass the association.

And so you've got to check the facts, although we are always surprised with the ability of AI programs to come up with things that we hadn't thought of or data points that we didn't know existed. But very often, not every once in a while, very often they make them [00:09:00] up and so you have to be sure and double check them all.

Tom Arend, Jr., Esq., CAE: Yeah. Jerry, what about to this point? Everyone's on a Zoom meeting now, even when you are in person infrequently now, andwe all know it's being recorded by AI and will be used later. This notion of transparency around when we're using AI and then disclaimers to that effect. 

Jerry Jacobs, Esq.: I think certainly when it's happening at a meeting, the attendees have a right to know that someone is recording what they're saying or proposing or objecting to.

So by all means, I think just membership relations again dictates transparency and openness, even to the point, does anybody object if we use this program in order to record and summarize this event in order to be more efficient in our work? 

Tom Arend, Jr., Esq., CAE: What about confidentiality concerns? I'm thinking of a board meeting.

A pretty standard agenda item is often executive session. 

Jerry Jacobs, Esq.: One of Jacob's theories of Association [00:10:00] Law and Policy is that there's no such thing as a confidential association meeting because your volunteers are unpaid or just because this isn't the same as their employer. 

Tom Arend, Jr., Esq., CAE: Yeah. 

Jerry Jacobs, Esq.: For whatever reason, it's virtually impossible to maintain complete confidentiality when you're making a major transaction and you're having it reviewed, or you're considering legislative or litigation advocacy alternatives or major budget issues, or you're evaluating the board itself.

Or senior employees of the organization, or obviously if you're listening to advice from your lawyers or investment advisors or others, confidentiality is important and it's a value to the success of the association, but it's very hard to maintain and, and it gets harder if people are recording meetings and you have no control over what they're doing with the recordings.[00:11:00] 

Tom Arend, Jr., Esq., CAE: Yeah, I couldn't agree with that more. I've seen a, for lack of a better word, a diminution in the value of confidentiality and their respect for it. Over the years, I don't know, because everything is now just out in the open and transparent and accessible to everybody. People don't think as much about confidentiality. But yeah, that's definitely a challenge.

What about intellectual property concerns when you're using AI? Internally as well as for a lot of associations like ours, we have, we have journals, right? We have clinical practice guidelines, we have other documents, content out there, and in some cases we found they're already being used or have been incorporated into some kind of AI platform without our permission.

Jerry Jacobs, Esq.: It's the essence of what associations do to corral joint action for the improvement of this or that. Tocqueville remarked about it in the 1830s, how uniquely American it is. It's a [00:12:00] kind of barn raising mentality, offshoot, and from an intellectual property point of view, what. We have to worry about is, if six people or 16 people or 116 people together create something, they actually all own it unless they sign away their rights.

And yes, you need to be careful about creating content in a group, and you need to manage ownership of that. And if that means asking the participants to assign away any rights that they might have in it, usually as part of some other. Document, maybe on confidentiality or decorum for our meeting or agreement on what we're trying to achieve here.

And then you tuck in. And by the way, I agree that the association owns anything that's the output of this event and have 'em sign it. 

Tom Arend, Jr., Esq., CAE: Yeah. And then I know there a lot of significant cases right now before the courts around certain AI providers having gone into. Large news organizations and scraped [00:13:00] their archives.

And like I said, we've seen that with some of our clinical materials, journal articles, that sort of thing that are owned by us or in a lot of association cases. They might be owned by the publisher, but they haven't given any permission to do to use that and that, and 

Jerry Jacobs, Esq.: Of course all of that is in litigation in a dozen cases.

And so far AI is winning. 

Tom Arend, Jr., Esq., CAE: Alright, last two questions on this area, then we'll move on. What about any insurance to try and protect yourself against liability, mitigate that risk. 

Jerry Jacobs, Esq.: Many associations now carry privacy disclosure data, privacy disclosure hacking damage insurance. I haven't seen the insurance community react or respond to risks from use of AI yet, and I'm guessing it's just too new.

Tom Arend, Jr., Esq., CAE: And then finally what I'm hearing is that there should always be this human oversight, this human intervention, whenever and wherever we're using it as an association.

Jerry Jacobs, Esq.: [00:14:00] Absolutely. 

Tom Arend, Jr., Esq., CAE: Alright, let's move to another topic that's very timely and also it can be very challenging for a lot of associations, and that's the changing legal landscape, federal policy.

Changes or almost a change to some degree in the zeitgeist of the country on issues of diversity, equity, inclusion, and the impact on associations and those programs. I recall that there was a case brought by, I think it was Students for Fairness or something to that effect, versus Harvard and University of North Carolina.

And the Supreme Court found that it was illegal, I think, contrary to the equal protection clause, to use any kind of race consciousness in admissions decisions. And then that decision has then been used to justify, essentially what we hear from the federal government is almost a blanket ban on using any diversity, equity inclusion criteria in [00:15:00] decision making, in awards, in contracting, in education.

At the association level, what have you, can you speak to that a little bit? 

Jerry Jacobs, Esq.: There's a tension. There's a tension between the scientific evidence that suggests that a greater range of voices, ideas, input, can contribute to a more successful output in almost any endeavor. On the other side, there are civil rights laws that have been in place since just after the Civil War that prohibit treating people uniquely because of their race, uh, and by extension from the civil rights laws in the 1960s based on other protected gender, ethnicity, that sort of thing. 

And so how does one resolve that tension? Up to now, it's been step by step, the 2023 Supreme Court case that you mentioned.

The court was careful to limit the purview of its decision to college admission decisions, period. I. [00:16:00] And yet the principle has been taken up, especially by this administration, and extended toward the policy view that essentially all diversity, equity, inclusion, even more broadly, environmental social governance, where and if it.

Results in treating any class unfairly, including those not specifically. Not in a protective class is wrong. Right? In fact, more than once, the administration in various contexts has said it's illegal, but without explaining what it is that's illegal or on what basis it's illegal. In addition to the Supreme Court case, though, we ought to be aware of one federal circuit.

Court case, 10th Circuit, in which a private foundation had a program that provided scholarships to black owned businesses, women, black owned businesses, and it required the recipients of those scholarships to sign a contract on [00:17:00] how they would use the money from the award. And that was challenged in court.

In the 10th Circuit, Alabama, Georgia, Florida purview concluded that violated the post-Civil War, civil rights lawon contracting based on race. What we have so far is college admissions and contracts, but there is a view. By extension of the Supreme Court decision and perhaps the 10th Circuit decision that any kind of benefit or favoritism based on any protected class, if your association has a women's caucus or if it has anAsian Engineers networking group, or Asian American networking group, anything that appears to provide a special privilege or benefit based on participation or non-participation in a protected class in the view of some. Certainly this administration [00:18:00] is problematic. In indeed the rhetoric of the administration is it's illegal.

Tom Arend, Jr., Esq., CAE: Yeah. Yeah. I know you mentioned just as an aside, ESG, the corporate model of environmental, social, and governance. Using those rubrics and the impact an organization has in those three spaces that's really almost been lumped in now with these DEI prohibitions and I've seen a lot of organizations either abandoning their ESG efforts altogether, or significantly downgrading them or recharacterizing them, refashioning.

Jerry Jacobs, Esq.: Yes, and I wouldn't be surprised if it's the majority of associations that since the second Trump administration began, or taking a look at how they describe various programs and whether there are ways to achieve the same result without using what are potential. Trigger words that could be picked up by a bot somewhere, and if not getting you in trouble, at least [00:19:00] shining a spotlight on you that you'd rather have shown on you.

So we have a lot of clients that are changing diversity to community, but without changing anything else. Query whether that's really worth the trouble because you might offend some folks in doing in your group.

Tom Arend, Jr., Esq., CAE: Exactly. 

Jerry Jacobs, Esq.: And even that, but it's going on a lot. One incident that's, that's too long and complicated to go into in detail, but the Department of Education confronted 45 or so colleges and universities for their sponsorship of a particular organization and required that they report back to the Department of Education on what they're doing to mitigate and moderate. Essentially, they wanted these schools to commit to not any longer supporting that organization and one of them. University of Kentucky actually published what had reported back to the federal government, and it went ahead and screened.

We don't know how, they don't [00:20:00] explain how they screened 1600 nonprofit organizations. The University of Kentucky somehow contributed to most cases, probably paying faculty or staff dues for a membership in an organization, purchasing publications or whatever. The University of Kentucky then excluded for from consideration 400 of those because they felt they really needed that.

Nonprofit credentialing organizations or whatever, but the other 1200, they basically put on a watch list and asked DOE what to do about it, because in those 1200, they found evidence of potential civil rights violations based on DEI. Mm-hmm. What they found. But the very number of 1200 means they must have used AI to just 

Tom Arend, Jr., Esq., CAE: Yeah.

Yeah. That, that's what we've been hearing as well, that they're using. Keywords. 

Jerry Jacobs, Esq.: Yeah. So the point is, do you want your association's website [00:21:00] to be called out impropriety illegality and have to defend it, or does it make sense to change some terminology? 

Tom Arend, Jr., Esq., CAE: So it seems like we're in a very murky environment right now, and even though a lot of times you hear this is absolutely illegal.

Whether something is legal or illegal is still somewhat being adjudicated right now. Formally that said, prudence wisdom probably dictates making some modifications. I've heard the expression used for organizations that feel very strongly about these issues. You don't wanna be deemphasizing, DEI, but at the same time, you wanna be de-risking your association and taking some prudent steps to at least get you out of the crosshairs of the federal government and some of these agencies that are looking for examples [00:22:00] right now.

Jerry Jacobs, Esq.: I think to conclude we ought to watch two things carefully. We ought to be careful as associations to not find ourselves in a position where we're actually entering into contracts such as scholarships that specifically involve preferential treatment to people based on race. We've got a late 1800s law that prohibits that, and we've got at least one for federal circuit court that said it's illegal.

So that's an area. We need to be careful of if you have a scholarship program where the benefits are based on racial characteristics, for God's sakes, don't ask the scholarship recipients to sign an agreement because that could get you over the line in terms of not just impropriety, but illegality, and then perhaps I would say softer.

Are you providing anything that could realistically be characterized as benefits or advantages to portions of your. Association constituency based on any protected [00:23:00] class characteristic. And it's just worth cataloging those and looking at them and asking yourself, does the culture history and success of your organization depend on perpetuating those or not, and make your decision.

Tom Arend, Jr., Esq., CAE: Yeah. Yeah. Good points. Alright, let's move to our last topic, which is under the very broad category of bad behavior, bad behavior by members, bad behavior by staff, vendors, consultants in the context of association activities like an annual meeting or a board meeting or an educational course, and I think both of us over our many years combined have seen a lot of these in various different forms.

I will say what I find interesting, and I think something to keep in mind is how you deal with it. Also depends on what the dynamic is. Is it a member to member issue? Is it a staff to member issue? Is it a staff to staff issue? Is it a member to [00:24:00] vendor or external consultant issue? And we've had experiences with all of these various kinds.

How do you first set up? Again, going back a little bit to the AI adoption issue is the environment, the guardrails, the policies and procedures first to hopefully create an environment where you can at least discourage that and set up ways to address it if and when they do happen. 

Jerry Jacobs, Esq.: I hope our behavior here has been beyond reproach, um, yours at least.

Jerry, has the problem accelerated in recent years? Is it COVID when everybody was cooped up? Is it just so much on the internet that everybody has access to right now? I don't know, but it is undeniable in our practice that we get far more frequent calls than we used to from our association clients about.

Bad behavior problems, usually at events, but not always. And it's almost appalling. Old fashioned sexual harassment is up [00:25:00] not down. And you would think that at this day and age we've gotten beyond that. Supreme Court has said that the sexual based conduct that makes a person reasonably uncomfortable is illegal.

And that an organization that does not have a written harassment policy is essentially defenseless against a claim, and that's basic. There's even a case in New York in which a member of an association asked to borrow an office while in the city from the association, and while there allegedly engaged in harassment, the association attempted to defend arguing that.

They had no control over this individual. He was just visiting the office, and the court said, no, you have an obligation to protect your workforce from this sort of thing by extension. That means that your associations have an obligation to protect your staff from attendees at events, engaging in improper conduct, specifically sexual harassment, but [00:26:00] also member to member to vendor staff, to vendor to staff, et cetera, et cetera.

I think we all know enough about sexual harassment to know what it is, how to help prevent it, what policies we need to have, et cetera. This is an issue that's been in the courts for the Supreme Court's Major decision was 20 years ago. 

Tom Arend, Jr., Esq., CAE: Yeah. 

Jerry Jacobs, Esq.: But. What's new and unique we think is, is just extreme impoliteness.

Tom Arend, Jr., Esq., CAE: Yeah. 

Jerry Jacobs, Esq.: Individual dominating a board meeting and kind of not listening to other views and demanding the microphone far disproportionately to what is reasonable. Or individuals walking up to a long line at a registration desk and starting yelling, this is unreasonable. I don't have time to waste standing in this line.

Yeah, I paid my registration or I paid my dues, and those kind of situations are really difficult to deal with. One thing you pointed out that we find amazing is it really does depend who's offending whom [00:27:00] as to what the result is. We've seen associations where their leader, the elected chair, was accused of pretty significant wrongdoing, basically bearing their head in the sand and saying, he's one of us.

We'll talk to him, but no, we shouldn't offend him. He's one of us. A boorish vendor at a trade show booth, it's a lot easier to just throw the bone out. 

Tom Arend, Jr., Esq., CAE: Right? Yeah. I think I've, I'm aware of examples where, because of a lack of appropriate process, and I would say process and policies that specifically address the different contexts in which harassment, bullying, just poor behavior can occur.

I think how you deal with it. Internally and who deals with it is very important. In other words, if it's a member to member issue, my view is that you absolutely have to have peers, members primarily leading that charge. It's usually not well received [00:28:00] when staff are seen as the. Prosecutors, for lack of a better word, similarly, if the dynamic is between a member and a staff person who, whoever is potentially the individual at fault.

That's a little bit more of a tricky dance because I think you need to have some kind of a collaborative approach to it. There has to be a senior staff person, a CEO, or somebody at that level along with a member addressing it, because I think either way, if you. Turf it entirely to the membership or turf it entirely to the staff leadership.

You're gonna get one party saying, Hey, that's not fair to me. Those are I, my interests aren't gonna be represented, so I 

Jerry Jacobs, Esq.: You made a good point about having a baseline. Yeah. Too many of these situations arise in circumstances where the association has nothing to point to. It's really not a code of ethics issue.

Yeah. Not a business code issue. It's a behavior issue. 

Tom Arend, Jr., Esq., CAE: It's a behavior, yeah. It's just you're being [00:29:00] a jerk. You're being rude, you're being disrespectful, you're being bullying. Whatever. 

Jerry Jacobs, Esq.: More and more we are seeing associations develop a good behavior policy, having it have it approved by the board, and then have it click through for every single registrant at every single event I have read and understand the policy on behavior at this event and to move on.

Everybody's gonna click through it. Nobody's gonna read it, but if bad behavior occurs, you can point to that and say, look, you agreed to follow our code. There's ample evidence that you violated our code. We have to ask you to leave. 

Tom Arend, Jr., Esq., CAE: Yeah, no, absolutely. You've gotta have those codes of conduct on both sides, on the staff side as well as the member side and the vendor side, or consultant side as well.

Jerry Jacobs, Esq.: Yeah. Remember the Oscars award show a couple years ago when there was the famous slap? There was actually no code that dealt with that. 

Tom Arend, Jr., Esq., CAE: Unfortunately. There was something even. Awful. That happened recently at another award show that, yeah, it's, yeah, human [00:30:00] behavior always seems to exceed the battles that are set for it at some point in time.

Thanks, Jerry. We've covered a lot of ground from artificial intelligence to diversity, equity, inclusion to unfortunate and bad behavior within associations. Appreciate as always your thoughtful insights and counsel. Look forward to speaking again in the future. And in the meantime, I wanna say thank you to all of our listeners for this episode of Associations NOW Presents.

Join us each month as we explore key topics relevant to association professionals discuss the challenges and opportunities in the field. And highlight the significant impact associations have on our economy, the United States and the world. Please be sure to subscribe to our podcast on Apple, Spotify, or wherever you listen to your favorite podcasts.

Please visit Associations NOW online at associationsnow.com. Thanks [00:31:00] everybody.