In Business Law, Corporations, Intellectual Property, Internet Law, Online Business Law

AI Legal Concerns

As a business owner, you’re bound to use or compete against artificial intelligence (AI) in the coming years. As often with new technology, the law will be following behind. Read this article for an overview of AI legal issues your business could potentially run into. For example:

  • who owns the copyright to a blog article prompted by a human but created by ChatGPT;
  • who is responsible if information is wrong;
  • who is responsible for damages and/or injuries as a result of AI;
  • can you hold ChaptGPT responsible,
  • what about intellectual property rights?

There’s a lot of opportunities with artificial intelligence for business. Be sure to keep a pulse on legal aspects of this technology so you can avoid potential pitfalls and use it as a benefit to your business.

What is AI?

It’s a computer technology that is capable of simulating human intelligence. In other words, AI has the ability to perform the cognitive functions we associate with human minds, such as perceiving, reasoning, learning, interacting with an environment, problem solving, and even exercising creativity.

Over the past year, or since the release of ChatGPT rather, AI and the ways in which it will impact our lives has become a very popular topic of discussion as well as an area of concern. Surprisingly, artificial intelligence is nothing new to us. It actually has existed in some form for decades, such as Google or Apple maps, facial detection, autocorrect, and more. However, AI’s scope and application has seen massive growth in recent years, since it can now be used to create new products and services, automate tasks, and generate creative content.

How is AI created?

Generative artificial intelligence, like ChatGPT, uses a language-based model, in which it will respond to the text users input, such as the format needed, a topic, and key words. Then the technology will search the internet, piece together the information discovered, and present it to the user in the requested format. Additionally, AI-generated content goes beyond writing as it can also create artwork and visual images.

“Generative AI software include complex machine learning models that have been trained on massive amounts of publicly available data, such as websites, images, videos, among others. To generate text, the software uses these machine learning models to predict the next word based on previous word sequences until the complete passage of text is generated. Similarly, to generate images, the software uses machine learning models to predict the next part of an image based on other images that include similar portions until a complete image is generated.” While there are benefits to these advances in this advanced technology, there are also legal challenges that come along with this new territory that raise some concerns.

image of artificial intelligence and law

Only use artificial intelligence for appropriate projects to ensure that a business does not run into legal issues.

AI and Intellectual Property Law

Because artificial intelligence is capable of automating tasks, generating content, and creating new products and services, it certainly poses a challenge to intellectual property law, which serves the purpose of protecting the rights of creators and innovators. One of the first challenges AI poses to intellectual property law is figuring out who owns the intellectual property rights to works generated by that technology. Copyright protection is available to certain types of AI. However, the line between whether or not artificial intelligence can be protected through copyright is still very blurry and unclear. This issue involving copyright law that will eventually need to be addressed by courts and legislators. As for now, it is determined on a case-by-case basis.

AI Legal Challenges

For instance, “Zarya of the Dawn,” a graphic novel created with the assistance of artificial image-generating technology, was granted a valid copyright registration for such work by the Copyright Office. This required the claimant to provide details on the creative process to prove that there was substantial human involvement during the creation of the graphic novel. Accordingly, the Copyright Office will not accept works that are wholly assisted by artificial intelligence in their creation. “A Recent Entrance to Paradise” was wholly created by the technology, and in Thaler v. Vidal, the U.S. Court of Appeals for the Federal Circuit concluded that AI cannot be listed as an inventor on a patent application. Thus, “A Recent Entrance to Paradise” was unsuccessful in its attempts to receive patent protection.

Another legal challenge artificial intelligence presents is the unauthorized use of copyrighted data to train generative AI models. These are trained on a great deal of publicly available data, including copyrighted one. This raises the issue of whether the use of copyrighted data to train artificial intelligence violates the copyright of the copyright owners, and the courts have yet to determine if that technology’s use of copyrighted data is allowed under the fair use doctrine. In the event that AI companies are found liable for copyright infringement, this would raise the question of whether or not liability can extend to users or companies that produced such data that was provided by artificial intelligence.

Similarly, another challenge is whether the output provided by the technology violates copyright. In other words, can a user or business be held liable if output provided by artificial intelligence infringes on a copyrighted work and that user then distributes or publishes that output as their own? If so, this would expose the entity that distributed or published the output to copyright infringement claims.

How AI Could Impact a Business

Many professionals and businesses have already started to incorporate generative AI into the workplace by using artificial intelligence to draft emails, generate blog articles, as well as generate graphics. This advanced technology can be very beneficial to a business. But for the above reasons, it is no surprise that AI can have a negative impact on a business if they do not have an understanding of the legal risks associated with using it in the workplace. In order to ensure that a business does not run into these legal issues, the business should only use artificial intelligence for appropriate projects, and in doing so, the business should do its due diligence to ensure that the output is accurate and not plagiarized.


About the Author

Wesley Henderson is a business attorney with Henderson & Henderson law firm in Charleston SC. He focuses on helping businesses navigate their legal environment, including new owners opening any type of new business that uses artificial intelligence. If you have any AI related issues or have copyright infringement issues, Wesley can be reached by email or by phone at (843) 212-3188.

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