In an era where artificial intelligence (AI) is reshaping landscapes in the healthcare industry and beyond, understanding the governance of AI technologies is paramount for organizations seeking to utilize AI systems and tools. AI governance encompasses the policies, practices, and frameworks that guide the responsible development, deployment, and operation of AI systems and tools within an organization. By adhering to established governance principles and frameworks, organizations can ensure their AI initiatives align with ethical standards and applicable law, respect human rights, and contribute positively to society. Various international organizations have set forth AI governance principles that provide organizations with a solid foundation to develop organizational AI governance based on widely shared values and goals.Continue Reading Navigating the Complex Landscape of AI Governance: Principles and Frameworks for Responsible Innovation

On August 21, 2024, Sheppard Mullin’s Healthy AI team conducted a CLE webinar on what hospitals, health systems and provider organizations should consider in building an artificial intelligence (“AI”) governance program. As they discussed, key elements of an AI governance program include: (1) an AI governance committee, (2) AI policies and procedures, (3) AI training, and (4) AI auditing and monitoring. These components of an AI governance program will help healthcare organizations embrace the complexities of AI use in healthcare by establishing appropriate guardrails and systematic practices to encourage its safe, ethical, and effective use. This post reviews each of the key elements.Continue Reading Key Elements of an AI Governance Program in Healthcare

Given the introduction of the ‘NO FAKES’ Act by a bi-partisan group of senators within days of U.S. Copyright Office’s release of its digital replicas report asserting an “urgent need” for more cohesive protections at the federal level, it’s clear that momentum is building for federal oversight in the realm of deepfake and digital replication technology. This legislative effort is intertwined with broader national and global discussions about AI’s impact on privacy, intellectual property, and personal identity, alongside existing gaps in enforceable protections.Continue Reading Closer to a Federal Right of Publicity – Senate Introduces NO FAKES Act

After almost 2 years of negotiations over a new interactive media agreement with video game industry giants such as Activision, Electronic Arts, Warner Bros. and Walt Disney Co., video game performers voted to strike as of Friday, July 26, 2024. The crux of the issue being negotiated surrounds artificial intelligence (“AI”) and performers’ fears that its unbridled use could provide game makers with a means to replace them by training AI to replicate an actor’s voice, or to create a digital replica of their likeness without consent and without fair compensation.[1]Continue Reading Game On: SAG-AFTRA’s Video Game Performer Members Strike Over AI Concerns

As general interest and investment in AI has accelerated since the initial public launch of ChatGPT, so too has the U.S. federal government both increased its spending in the area[i] and the speed with which it adopted guidelines on the utilization of AI more generally.[ii] This tracks other actions outside the U.S.,[iii] and anticipates corresponding initiatives at the state and municipal levels.[iv]Continue Reading AI Considerations in Government Contract-Related M&A Transactions

As we stand on the cusp of transformation in the commercial real estate industry, one cannot help but recall the sage words: “With great power comes great responsibility.” In an era marked by technological advancements occurring at a blistering pace, the real estate industry (commercial, industrial, residential, office, hotel and every other class of real estate) stands on the brink of transformation and the seemingly limitless promise and power of generative artificial intelligence (AI) looms large as both a disruptor and a savior. There is no ignoring it, just like virtually every other industry, the real estate industry is changing rapidly through the use of AI, and if you aren’t adapting your business to account for those changes, you are putting your business at significant risk. Traditionally, change in the commercial real estate industry has been akin having an oil tanker make a 180-degree turn – slow, laborious and infrequent. The changes that have been brought upon by AI are more like making a 180-degree turn in a Ferrari – fast, easy and frequent. However, these competitive and rapid shifts, while alluring, come with increased risks and the need to proactively manage those risks. The questions on everyone’s mind are: (i) Can AI really predict the future success of a project, (ii) how trustworthy is AI, (iii) how is AI going to change my business and (iv) what do I need to be worried about? Every day, public and private organizations are working towards answering those questions, not only developing reliable tools, but regulating the use of those tools to insure an even playing field. Continue Reading AI is Changing the Real Estate Industry. How Will It Impact Your Business?

Is your M&A target a company that develops or uses artificial intelligence (“AI”) tools? AI, and generative AI technologies specifically, are powerful business tools but present novel legal issues in the context of M&A transactions. It is increasingly important to identify and understand the unique legal risks associated with the use of AI technologies, tailor your diligence to investigate them and include AI-specific reps and warranties in your deal documents. To effectively do this, it is important to have someone well-versed in AI technology and the associated legal issues on the deal team. Many subtle issues, if not properly understood and addressed, can lead to liability and/or loss of business value. The attached article addresses the expansion of due diligence, beyond standard tech diligence, to include the analysis of AI tools developed or used by the target. It covers some of the key AI-specific legal issues to consider in M&A, but the issues in each transaction will be unique depending on the target company’s involvement with AI. Once you understand the target company’s involvement with AI, it is important to consider the unique legal issues and the diligence needed beyond the standard diligence questions.Continue Reading M&A Transactions: Diligencing AI Issues with Target Companies

The United States Patent and Trademark Office (USPTO) is holding a roundtable discussion, on August 5, 2024, about the intersection of AI technology and legal protections for individuals’ reputations and name, image, voice, likeness (NIL), and other indicators of identity. These rights of publicity are currently protected by a patchwork of inconsistent laws and common law rights in dozens of states. In addition to addressing whether existing legal protections for individuals’ NIL and reputations are sufficient and how these legal protections intersect with other IP laws, the USPTO is specifically interested in how AI technology impacts existing legal protections for NIL and reputation. As the USPTO notes, AI technology enables new and efficient ways to create digital media, including images, audio, and video. AI can be used to generate digital media that incorporates individuals’ NIL or impacts individuals’ reputations, with or without appropriate authorization. The unauthorized use of AI-generated NIL content can implicate Federal trademark and copyright laws, as well as state NIL laws.Continue Reading USPTO Roundtable: AI and Right of Publicity

The USPTO has published updated patent eligibility guidance (effective July 17, 2024) for AI-related inventions to help determine subject matter eligibility under 35 § U.S.C. 101. This guidance is timely as roughly 20% of all recent patent filings are AI related. It is important to note that based on prior guidance from February 2024, if an AI tool itself invents something, that is not patentable. Only inventions with significant human contribution are patentable. Thus, this does not preclude AI-assisted inventions. This February guidance was supplemented in April 2024 with AI guidance for practitioners and a request for comments on the impact of AI on certain patentability considerations, including what qualifies as prior art and the assessment of the level of ordinary skills in the art. The period for comments remains open until July 29, 2024.Continue Reading USPTO Issues AI Subject Matter Eligibility Guidance

The battle between open source software developers and the leading AI code generators will rage on. Despite the Court dismissing Plaintiffs’ Digital Millennium Copyright Act (DMCA) Section 1202(b) claims with prejudice, it declined to dismiss Plaintiffs’ claims for breach of contract of open source license violations by Defendants. However, the Court also dismissed Plaintiffs’ request for of unjust enrichment and punitive damages.Continue Reading Court Rules in Landmark AI Code Generator Case – DMCA Claims Dismissed but Breach of Contract Claims Remain