Artificial Intelligence

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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.

Keypoint: If signed into law, Colorado will become the first state to enact legislation regulating the use of high-risk artificial intelligence systems.

On May 8, the Colorado legislature passed the Colorado Artificial Intelligence Act (SB 205). If signed by Governor Jared Polis, Colorado will become the first state to enact legislation that broadly addresses the use of artificial intelligence, in particular the use of artificial intelligence in high-risk activities. The bill is co-sponsored by Senate Majority Leader Robert Rodriguez and House Representatives Manny Rutinel and Brianna Titone.

In the below article, we first provide context and background on the bill. We then provide a summary of the bill’s provisions.

Keypoint: Since our last update, the Connecticut Senate passed an algorithmic discrimination bill, an algorithmic discrimination bill was introduced in Colorado and passed the Colorado Senate Judiciary Committee, and an algorithmic discrimination bill passed out of a California committee.

Below is our fourth update on the status of pending US artificial intelligence (AI) legislation that would affect the private sector.

Keypoint: Since our last update on US artificial intelligence (AI) legislation impacting the private sector, Utah enacted the first AI private sector bill of 2024, Oklahoma moved closer to passing an AI Bill of Rights, Connecticut’s bill advanced through a committee, and California lawmakers introduced two bills that would establish transparency requirements around generative AI and personal information used to train AI models.

Below is our third update on the status of pending US artificial intelligence (AI) legislation that would affect the private sector.

Keypoint: While not as far-reaching as bills under consideration in other states, the Utah bill creates some obligations for private sector companies deploying generative artificial intelligence, including disclosing its use.

In early March, the Utah legislature unanimously passed SB 149. The bill is now with Utah Governor Spencer Cox for signature. In general, the bill: (1) specifies that Utah’s consumer protection laws apply equally to an entity’s use of generative artificial intelligence as they do to the entity’s other activities, (2) requires private sector entities to take steps to disclose and/or respond to inquiries about their use of generative artificial intelligence, and (3) creates the Office of Artificial Intelligence Policy which is charged with, among other things, administering an artificial intelligence learning laboratory program. Once signed by the Governor, the law will go into effect on May 1, 2024.

In the below article, we provide a brief analysis of the bill’s provisions.