Tech & Sourcing @ Morgan Lewis

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.

As companies expand their use of artificial intelligence, copyright law has become a central area of risk and uncertainty. Building on a recent Tech Marathon webinar presented by Morgan Lewis, we highlight key takeaways from recent court decisions testing fair use in AI training as well as legislative proposals on copyright disclosure and digital replicas. The landscape is shifting quickly, and technology lawyers should be prepared to help clients evaluate AI-related rights and manage risks in transactions.

As ransomware threats, data breach litigation, and supply chain cybersecurity concerns become increasingly more common and costly, buyers of tech, SaaS, and outsourcing services are giving far more weight to cyberliability insurance requirements in their contracts. While cyberinsurance provisions are becoming a routine point of negotiation in technology and outsourcing agreements, expectations on coverage, limits, and scope may vary widely.

Join us for our Technology Marathon, an annual series of tailored webinars focused on hot topics, trends, and key developments in the technology industry that are of essential importance to our friends and clients. Now in its 15th year, our expansive curriculum kicked off after AI Boot Camp in April and continues into December.

As the summer 2025 concert season continues to ramp up, we want to take the opportunity to explain why your favorite band or artist might only be performing once in your region this summer: a radius clause.

We are excited to welcome Mathilde Carle as a partner in Morgan Lewis’s Paris office and as a guest contributor to our Tech & Sourcing Spotlight series to discuss intellectual property (IP) protection and other related issues in agreements to design, build, license, host, and support digital solutions, including automation, AI, and software as a service (SaaS) products.

2025 has seen a notable push by companies to establish dedicated capability centers—or global capability centers (GCCs)—in countries with lower-cost resources and access to a strong talent pool. According to S&S Insider, the global GCC market was estimated at about $128.5 billion in 2023 and is expected to increase to more than $300 billion by 2032, growing at a rate of 13.51% CAGR. NASSCOM reports that India leads the GCC market, currently hosting over 1,700 GCCs, employing more than 1.9 million people, and having an 11% CAGR.

The leveraging of outsourcing engagements to implement and support digital transformation solutions is emerging as the foundation for the next generation of outsourcing. Digital transformation is a critical part of many companies’ strategic roadmap, seen as creating key opportunities for cost savings, efficiency, productivity and quality improvements, enhanced customer experience, and competitive advantages, including through state-of-the-art automation and data analytics. Many companies do not have the internal resources or skill sets to implement digital transformation at the required pace. This is leading to companies “leaning in” on their outsourcing providers to identify, design, and enable digital transformation solutions in a secure and compliant manner.