Tech & Sourcing @ Morgan Lewis

AI usage policies have become the new norm as businesses across industries adopt various AI technologies in hopes of enhancing productivity and staying competitive, with many companies now revisiting and updating their AI usage policies to become more permissive while aiming to meet any transparency requirements.

Kari Krusmark, a partner in our technology transactions, outsourcing, and commercial contracts practice, is a leading advisor in complex technology initiatives, outsourcing arrangements, and digital transformation projects. With deep background guiding global companies through high-value technology deals, evolving regulatory requirements, and vendor ecosystem shifts, Kari has a unique perspective on how organizations should prepare for the rapidly changing technology and outsourcing landscape. Her insights highlight the key trends shaping 2026 and what businesses should be doing now to stay ahead.

One of the key concepts in contracting for generative AI (GenAI) is allocating rights to data that the GenAI tool processes and generates, as well as any data used to train, test, and improve the underlying AI model. A new concern in these contracts relates to the use of a GenAI tool (or data generated by this tool) for competitive purposes and corresponding contractual restrictions. This blog post outlines some of the relevant considerations when evaluating and negotiating contractual provisions relating to these data rights and use restrictions.

As the use of generative artificial intelligence (GenAI) proliferates, customers and vendors face unique challenges in contract negotiations. This post discusses these challenges, offering viewpoints from both perspectives.

Morgan Lewis’s technology, outsourcing, and commercial contract team, along with Boston Consulting Group, recently hosted a roundtable dinner in London, during which senior stakeholders from technology suppliers and large businesses discussed how the rapid evolution of artificial intelligence (AI) is impacting offshoring and outsourcing.

The European Supervisory Authorities (ESAs) published on November 18, 2025 a list of 19 critical information and communications technology (ICT) third-party providers (CTPP) that will be subject to direct oversight under the EU Digital Operational Resilience Act (DORA). The list includes hyperscale cloud providers, data center providers, infrastructure and network providers, and providers of financial services-specific technology.

Open-source software (OSS), by its nature, is sometimes overlooked as part of technology transactions. OSS is often a key aspect of a business’s software ecosystem, whether it is used in internal systems or forms a fundamental part of solutions that are sold to customers or used to provide services to customers; however, OSS often sits in the background, as a foundation of a software solution, and can therefore go unconsidered by those not familiar with its uses, benefits, and risks.

Artificial intelligence tools designed to perform a specific autonomous function with limited human interaction (commonly referred to as “agentic AI”) are changing the operation of myriad business processes, accelerating the rate at which organizations can handle data workflows and complex decision making. As AI agents transform into full-fledged virtual assistants, organizations are finding new ways to drive value by redesigning their enterprise’s digital landscape to accommodate and augment agentic AI. However, consumers and customers have increasingly been employing agentic AI to interact with companies of all sizes, highlighting that the use of agentic AI may no longer be a one-way road from businesses to customers.

On October 3, 2025, California Governor Gavin Newsom signed Assembly Bill 940 into law, with the announcement of new funding in an effort to establish a unified strategy in the state to help continue growing the quantum technology industry. AB 940 seeks to build on the state’s established presence in the sector: California is home to both National Science Foundation and US Department of Energy quantum federal research centers. Faster-than-expected innovation could see a surge in the quantum technology economy not just in California but the global economy overall.

As aerospace and defense programs become increasingly reliant on complex, multitiered supply chains and emerging technologies, disputes over intellectual property, supply, pricing, and performance are on the rise. To better understand the litigation landscape we spoke with Michelle Pector, a partner in our Houston office. Michelle is a seasoned trial lawyer and trusted counselor who serves as co-chair of the firm’s aerospace and defense industry team and leader of the energy litigation practice.