artificial intelligence

Is your M&A target a manufacturing company with automated production, a consumer products business with online sales and marketing or an education company that creates content for students? The increasing use and development of artificial intelligence (“AI”) systems and products, particularly generative AI, has created risks for businesses using such tools. AI plays a role in many industries and businesses whose products and services are not themselves AI. In the context of a M&A transaction, it is important to identify and allocate responsibility for these risks. Risks of AI may include: infringement (including through use of training data as well as outputs), confidentiality, IP ownership and protection (including limits on protection of IP generated by AI), regulatory (e.g., privacy, recent AI related legislation), and other risks arising from use such as indemnity obligations or managing contractor use of AI.Continue Reading M&A Transactions: Drafting AI Representations and Warranties for Non-AI Companies

The use of artificial intelligence (AI) is booming. Investors and companies are pouring cash into the space, and particularly into generative AI (GAI), to seize their share of the market which McKinsey reports could add up to $4.4 trillion annually to the global economy. Some companies are investing tens or hundreds of millions of dollars or more into GAI. Whether companies are building their own AI technology and training their own AI models, or leveraging third party tools, there are significant legal issues and business risks that directors need to consider as part of their fiduciary obligations and corporate governance. Five of the top issues to understand and consider are addressed in this article. Many other issues can arise. A wave of litigations and enforcement actions has swelled. Boards should get educated on these issues and ensure appropriate policies and corporate governance are implemented to manage the business and legal risks.Continue Reading 5 Things Corporate Boards Need to Know About Generative AI Risk Management

On August 9, 2023, President Biden issued an Executive Order (E.O.) ordering the issuance of outbound investment restrictions. This E.O. comes after nearly a year of anticipation (as we have documented on several occasions over the past year). This is the start of the reverse Committee on Foreign Investment in the United States (CFIUS) process that has been mostly speculation (and blog articles) until yesterday. In conjunction, the Treasury Department issued a press release, fact sheet, and Advance Notice of Proposed Rulemaking (ANPRM) seeking comments from the public on the proposed restrictions by September 28.Continue Reading New Outbound Investment Restrictions Affect China, Semiconductors, Artificial Intelligence, and Quantum Computing