Artificial Intelligence

Keypoint: The Texas Attorney General reaches a first-of-its-kind settlement with a healthcare company that provides generative AI products. 

On September 18, 2024, the Texas Attorney General announced that it had reached a settlement with a Dallas-based artificial intelligence healthcare company. The Attorney General’s press release represents that it is a first-of-its-kind settlement, resolving allegations that the company deployed its artificial intelligence (“AI”) products at Texas hospitals while making false and misleading statements about the safety of its products. 

Keypoint: The California legislature closed its 2024 session by passing five privacy-related bills and four AI-related bills.

On Saturday, August 31, the California legislature closed its 2024 session. During the past calendar year, we tracked numerous privacy and AI-related bills with fourteen of them passing out of their chamber of origin prior to the legislative deadline. For the past month, we have been tracking thirteen of those bills with weekly updates (the fourteenth bill already having passed through the legislature). Of the six privacy-related bills we have been tracking, five ultimately passed the legislature during the final week of the session. Four of the seven AI-related bills also passed. 

The below article first provides a summary of the bills that passed during the final week of the session. The article then provides an overview of all fourteen bills.

Keypoint: The California legislature enters into the final week of its session with many bills still under consideration.

We are currently tracking thirteen privacy and AI-related bills that previously crossed chambers prior to the legislative deadline. With the California legislature closing on August 31, we will be providing weekly updates on the progress of these bills.

Keypoint: Although not nearly as far-reaching as the Colorado AI Act, the Illinois law adds to the growing patchwork of state laws that regulate artificial intelligence.

On August 9, Illinois Governor J.B. Pritzker signed HB 3773 into law. The bill, which goes into effect January 1, 2026, amends the Illinois Human Rights Act to regulate the use of artificial intelligence in certain employment settings. In the below article, we provide a summary of the law and its provisions.

Keypoint: Companies onboarding AI products and services need to understand the potential risks associated with these products and implement contractual provisions to manage them.

With the rapid emergence of artificial intelligence (AI) products and services, companies using these products and services need to negotiate contractual provisions that adequately address the unique issues they present. However, given that this area is new and rapidly emerging, companies may not appreciate that the use of AI may raise unique contractual issues. Even if companies do realize it, they may not know what those provisions should state. In addition, many AI-related contractual terms are complicated and confusing, oftentimes containing new terms and definitions that companies are unfamiliar with handling. 

In the below article, we identify key considerations when reviewing or preparing AI-related contracts. Although there may be other considerations depending on the specific use case, the below considerations should provide the reader with a useful starting point for how to address this issue.

Keypoint: Last week, several privacy and AI bills passed out of committee (with some receiving amendments) while two bills died in committee.

We are currently tracking thirteen privacy and AI-related bills that previously crossed chambers prior to the legislative deadline. With the California legislature closing on August 31, we will be providing weekly updates on the progress of these bills.

Keypoint: Last week, the California legislature returned from its summer recess and began moving forward with privacy and AI legislation prior to the August 31 session closing date.

We are currently tracking thirteen privacy and AI-related bills that previously crossed chambers prior to the legislative deadline. With the California legislature closing on August 31, we will be providing weekly updates on the progress of these bills.

Keypoint: The Texas Attorney General reached a $1.4 billion settlement with Meta over its alleged violations of Texas’ biometric privacy law.

On July 30, 2024, the Texas Attorney General announced that it has reached a $1.4 billion settlement with Meta over its alleged violations of Texas’ “Capture or Use of Biometric Identifier” Act (CUBI). The Attorney General’s press release represents that the settlement, which arises out of a 2022 complaint, is the first under CUBI. It also represents that the settlement “is the largest privacy settlement an Attorney General has ever obtained.”

In the below article, we provide a brief overview of CUBI and the underlying allegations in the complaint.

Keypoint: The California legislature has many pending privacy and AI-related bills to consider before it closes on August 31.

The California legislature left for its summer recess on July 3 and will reconvene on August 5. Once it returns, the legislature will have twenty-six days to pass bills before it recesses for the year on August 31.

In the below article, we identify and briefly summarize the pending privacy and AI bills and where they stand in the legislative process. The bills cover a wide range of topics, including kid’s privacy, opt-out preference signals, neural data, and algorithmic discrimination. All together, we are tracking fourteen bills, one of which was signed into law on July 15. The remaining thirteen bills all passed through their chamber of origin prior to the May 24 deadline and are at various stages of consideration in the opposite chamber.

Keypoint: The California legislature is considering several bills that, if passed, would add to the nation’s emerging legal patchwork governing the use of artificial intelligence.

In mid-May, Colorado Governor Jared Polis signed the Colorado Artificial Intelligence Act (CAIA) into law, making Colorado the first state to enact legislation governing the use of high-risk artificial intelligence systems. Earlier this year, Utah enacted SB 149, which creates limited obligations for private sector companies deploying generative artificial intelligence, including disclosing its use.

The California legislature is currently considering seven AI-related bills that, if passed, would add to the growing patchwork of state AI laws. All of these bills have passed their chamber of origin and are currently being considered by the opposite chamber. While many state legislatures have already closed for the year, California’s legislative session does not end until August 31, 2024, meaning that there is still time for California to pass one or more bills.

In the below article, we briefly summarize these bills (as they are currently drafted) and identify their current status. We previously discussed four of these bills in our April 25 AI Legislation Update.