Granola lawsuit raises concerns over AI note-taking app privacy

AI note-taking app maker Granola is accused of violating privacy laws by developing software that can record conversations without all participants’ consent, according to a lawsuit filed July 30 in a California federal court. It follows a similar ongoing case in the same district, filed last year, that involves another note-taking and transcription software vendor, Otter.ai. AI note-taking apps have proliferated in recent years, with dedicated tools emerging from vendors including Fellow, Fireflies, Otter, and others, some of which claim to have tens of millions of users. These AI assistants record and transcribe meeting conversations, generating automated summaries and follow-up items. Similar note-taking functionality is also built into virtual meeting platforms such as Google Meet, Microsoft Teams, and Zoom. However, the use of these AI note-taking tools has raised privacy concerns over the ability of some to record and transcribe conversations without the consent of all participants. The proposed class action complaint against Granola, filed by Florida resident Tarra Chamberlain in the US District Court for the Northern District of California, alleges the company “purposefully” designed its app to record calls without requiring disclosure to all participants.   While some note-taking tools require a bot to join a video or voice call, Granola captures audio directly from the user’s computer, allowing it to transcribe meetings without appearing as a meeting participant. The complaint argues that this violates individual privacy rights as well as the California Invasion of Privacy Act (CIPA) that requires “all-party” consent when recording calls. The complaint also alleges that Granola then by default uses transcription data for commercial purposes, including its use in training its AI models, and “actively advertises the hidden nature of its technology as one of its primary advantages.” Granola did not respond to a request for comment. According to the company’s website, Granola offers two optional “transparency features” that can be enabled by app users and admins: an automated chat message that alerts participants when transcription begins, and a watermark added to the user’s video feed. The company also promises that data used to train its AI models is anonymized and “never sent to third parties.” The Granola case bears similarities to a separate lawsuit involving Otter.ai. The class action filed last year alleges that Otter.ai records all users without their consent and uses their voices to train its speech recognition AI tools. Reporting on the latest developments in the Otter.ai suit, MLex wrote this week that, during a court hearing Monday, the judge overseeing the case expressed skepticism about the company’s argument to dismiss the case. US District Judge Eumi K. Lee did not issue a ruling from the bench, saying a written judgement would follow. The two cases highlight some of the concerns businesses face when deploying AI note-taking tools. AI notetaking is “more dangerous than any other type of traditional recording apps and tools,” said Enza Iannopollo, Forrester VP and principal analyst, as it raises additional questions about the use of employees’ conversation data. “Specifically, is the recorded data used for training models? Is the voice used for training other AI? How do I get ‘forgotten’ after my data and biometrics have been recorded? These concerns apply to AI specifically and must be added to the traditional privacy and confidentiality concerns organizations have for other type of recording apps and tools,” she said. Before deploying AI note-taking apps, Iannopollo recommends that businesses take appropriate steps to vet the tools and “ensure that all contractual clauses are aligned to the business AI risk appetite and risk management best practices.” “As these tools record, process, store, and share biometric data, organizations must ensure that they comply with all the relevant requirements,” Iannopollo said, adding that transparency and consent notices should be provided to all parties involved in the use of AI note-taking apps.