AI’s considerable impact will play out in the courts in 2024
With high-profile lawsuits pending against key players like Open AI and Meta, we are likely to see US courts rendering a patchwork of decisions over the coming months in several key categories:
Privacy: Cases are arising out of the use of “data scraping” technology to train AI algorithms. Data scrapers extract information from websites that is then sold to train large language models, which can result in the collection and dissemination of sensitive information.
Copyright/Intellectual Property: Artists and authors are alleging that copyright laws are violated by the training of AI models on their work without providing any compensation (see for example the NY Times’ current suit against OpenAI). These cases could force large tech companies to change the way AI is built, trained and deployed so that it is fairer and more equitable.
Libel/Defamation: There are questions arising around who bears responsibility when AI produces false, reputation-harming information, as in this recent incident at a local car dealership. Even more serious is the potential use of these tools to spread disinformation and to create deep fakes.
Fraud/Breach/Ransomware: The availability of new AI tools will impact claims involving fraud, data breaches and ransomware.
Data scraping can result in the collection of sensitive information. The US Federal Trade Commission has opened an investigation into whether OpenAI violated privacy and consumer protection laws by scraping people’s online data to train ChatGPT. There are also lawsuits against OpenAI alleging privacy violations as a result of the data scraping that was used to train the model.
Melissa Collins
Claims Focus Group Leader, Cyber and Technology Third-Party Claims
Data presented in this Cyber Services Snapshot is derived from global incidents reported to Beazley between 2021 and 2023.
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Data scraping can result in the collection of sensitive information. The US Federal Trade Commission has opened an investigation into whether OpenAI violated privacy and consumer protection laws by scraping people’s online data to train ChatGPT. There are also lawsuits against OpenAI alleging privacy violations as a result of the data scraping that was used to train the model.
