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Law & regulation

A US lawsuit against an AI notetaker shows the problem - in Germany it's criminal, not just civil

August 22, 2026 · 11 min read · Beyond Prompt AI Studio

AI meeting toolsLawEmployment lawCompliance

In August 2026, former Marathon Engineering employee Lindsay Waninger filed a gender discrimination lawsuit in a New Jersey state court. The central piece of evidence: an AI-generated transcript of her own termination meeting, produced by the meeting tool Fireflies, in which a supervisor allegedly said the 'ideal' replacement for her role would 'hopefully' be a 'relatively strapping young man'. In parallel, a consolidated class action is proceeding in a California federal court against Otter.ai, alleging it recorded private conversations without every participant's consent and used those recordings to train its AI models without adequate disclosure. This analysis reads past the US coverage: what's discussed there mostly as an evidence and privacy question is, under German law, potentially something sharper - a criminal offense.

Key points at a glance

  • In August 2026, an AI transcript of a termination meeting became the central piece of evidence in a discrimination lawsuit against Marathon Engineering in the US - produced by the widely used meeting tool Fireflies, apparently without the participants anticipating it would be used in court.
  • In Germany, Section 201 of the Criminal Code (StGB) makes unauthorized recording of non-public spoken words a criminal offense, punishable by up to three years' imprisonment or a fine. In principle, consent from every participant in a conversation is required.
  • Legal analyses of AI-powered meeting transcription conclude that most mainstream tools technically buffer the audio signal rather than processing it purely transiently in memory - which regularly brings them within the scope of Section 201(1) No. 1 StGB when not every participant has given effective consent.
  • In an employment relationship, that consent is practically hard to secure: lawyers point out that employees facing a supervisor often lack the voluntariness required for effective consent - agreement given under de facto pressure is legally vulnerable.
  • In addition, Article 5(1)(f) of the EU AI Act has banned emotion-recognition systems in the workplace since 2 February 2025, with fines of up to €35 million or 7 percent of global annual revenue. Some AI meeting tools advertise sentiment or mood analysis of conversations - a feature that can fall within this prohibition.
  • The EU AI Act ban doesn't just target the tool vendor - it applies to any company that deploys such a system, regardless of whether it developed emotion recognition itself or is merely using a feature of a licensed tool.

What happened in the US

Lindsay Waninger worked at Marathon Engineering for fewer than three months before being fired in a video conference. The meeting was automatically transcribed by the AI app Fireflies. Per her lawsuit, filed in August 2026, the transcript recorded a supervisor allegedly saying the 'ideal' replacement for her position would 'hopefully' be a 'relatively strapping young man' - a statement now cited as evidence of gender discrimination. Even if the transcript ultimately isn't fully admissible in court, its existence still has to be disclosed during discovery, and can trigger further witnesses or investigation.

In parallel, a consolidated class action is proceeding in a US federal court in Northern California against Otter.ai, alleging the tool recorded private conversations without every participant's consent and used the recordings to train its own AI models without adequate disclosure. Together, both cases show a pattern: AI meeting tools preserve, and can surface, conversation content that participants never anticipated being used in court or by third parties at the time they spoke.

The German legal position: not a consent problem, a criminal offense

US coverage largely frames this as a question of consent, privacy, and evidence admissibility. Under German law, the starting position is sharper: Section 201 of the Criminal Code (StGB) makes unauthorized recording of another person's non-publicly spoken words a criminal offense - punishable by up to three years' imprisonment or a fine. In principle, consent from every participant in a conversation is required, not just from the person who activated the tool.

A technical nuance is decisive here, one that legal analyses of AI-powered meeting transcription work out in detail: if a conversation is transcribed purely 'on the fly', without the audio material itself being stored, there's no punishable recording. But for most mainstream transcription tools, the processing pipeline includes intermediate or buffer storage of the audio signal that goes beyond merely transient processing in working memory - which technically fixes the spoken word and regularly brings the case within the scope of Section 201(1) No. 1 StGB.

Why consent is especially hard to secure in an employment relationship

Effective consent from every participant rarely proves practical - particularly in an employment relationship, where the voluntariness required for effective consent is often missing. If a manager announces that a meeting will be AI-transcribed, and employees can't realistically object without risking their position, that consent is legally vulnerable. That concerns exactly the situations - termination meetings, performance reviews, conflict conversations - that became the subject of dispute in the Marathon Engineering case, and where a later evidentiary use is most likely to matter.

The additional EU AI Act dimension: emotion recognition

A second, independent legal layer concerns a feature some AI meeting tools advertise as an add-on: sentiment or mood analysis of conversations. Article 5(1)(f) of the EU AI Act has, since 2 February 2025, banned placing on the market, putting into service, or using emotion-recognition systems in workplace settings, aside from narrowly defined medical or safety purposes. An emotion-recognition system in this sense is any AI system designed to identify or infer the emotions or intentions of natural persons based on their biometric data - including voice. Violations fall into the regulation's highest fine tier: up to €35 million or 7 percent of global annual revenue, whichever is higher.

Decisive for companies that merely use such a tool rather than develop it: the ban doesn't just target vendors, it applies to anyone who uses a corresponding system. A company using a licensed meeting tool with a sentiment-analysis feature enabled in a workplace context violates Article 5 under this logic just as much as the tool vendor itself - regardless of whether it actively promoted the feature or simply left it on by default.

What this means in practice

Both legal layers - Section 201 StGB and Article 5 of the EU AI Act - concern a tool already in everyday use at many companies in our audience, often without the legal implications having been actively reviewed.

  • Check which AI meeting tools are actually in use across your company - these are often activated independently by individual teams or managers, without central IT or legal sign-off.
  • Before any AI-transcribed conversation, obtain effective, documented consent from every participant - and for termination meetings, performance reviews, or conflict conversations in particular, critically assess whether that consent is genuinely voluntary given the power imbalance involved.
  • Actively check whether a tool in use includes sentiment or emotion-recognition features, and disable them in workplace contexts unless they fall under one of the narrowly defined exceptions in Article 5 of the EU AI Act.
  • Set internal policies for using AI meeting tools that clearly govern the consent process, data retention, and permitted feature scope, rather than relying on a given vendor's default settings.

The real value of this analysis isn't a warning against AI meeting tools as such - they offer genuine value for documentation and follow-up. The point is that the legal starting position in Germany differs from the largely civil-law US debate: where a US company manages a consent and evidence problem, a German company without solid consent from every participant can commit a criminal offense - a difference that shouldn't get lost in the risk assessment.

Frequently asked questions about AI meeting transcripts and German law

Do we commit a criminal offense if we use an AI meeting tool without every participant's consent?

Possibly, yes. Section 201 StGB criminalizes unauthorized recording of non-publicly spoken words. What matters is whether the tool technically buffers the audio signal - per legal analyses, that's the case for most mainstream tools. Without effective consent from every participant, there's a risk of criminal liability that should be reviewed case by case.

Is it enough if the manager announces that the meeting will be transcribed?

A mere announcement doesn't substitute for effective consent. In an employment relationship in particular, the required voluntariness is often missing when employees can't realistically object without risking their position. Documented, genuinely voluntary consent is the safer path.

What does this have to do with the EU AI Act if it's about German criminal law?

These are two independent legal layers concerning the same tool. Section 201 StGB concerns the recording of spoken words itself. Article 5 of the EU AI Act additionally concerns sentiment or emotion-recognition features some meeting tools offer - which have generally been banned in the workplace since February 2025, with fines of up to €35 million or 7 percent of global annual revenue.

Does the emotion-recognition ban apply to us if we only use the tool, without having developed it?

Yes. Article 5 of the EU AI Act doesn't target only developers, but anyone who deploys a corresponding system. A company using a licensed tool with an emotion-recognition feature enabled in a workplace context can itself violate the ban, regardless of who originally developed the system.

Want your use of AI meeting tools reviewed for Section 201 StGB and EU AI Act compliance?