On July 17, 2023, the National Association of Insurance Commissioners (NAIC) released for comment a Model Bulletin (Bulletin) on regulatory expectations for the use of artificial intelligence systems (AI Systems) by insurers. The Bulletin was released through the NAIC’s Innovation, Cybersecurity and Technology Committee. The Bulletin advises insurers of the information that insurance regulators may request during audits or investigations of the insurer’s AI Systems, including third-party AI Systems. The Bulletin doesn’t go as far as requiring but encourages insurers to implement and maintain a board-approved written AI Systems Program. It recommends that the Program addresses governance, risk management controls, internal audit functions and third-party AI systems.
On July 21, 2023 the White House announced that seven leading AI companies committed to put new AI systems through third party testing before they are released to the public and to label AI-generated content. The seven companies, Microsoft, Google, Amazon, Meta, OpenAI, Anthropic and Inflection, are making a several voluntary commitments in an agreement with the White House with the goal of improving the safety and trustworthiness of the AI solutions they develop. One of the other objectives is to provide Congress and the White House with more runway to design regulations in an area of technology that has taken the world by storm.
As many know by now, generative AI is a rapidly developing field that has the potential to revolutionize many industries and may significantly impact the way we interact with AI in the future. However, as the technology continues to evolve, it also raises a multitude of intellectual property (IP) issues that will need to be addressed. The IP issues that are being discussed are numerous and over the last few months there have been a slew of IP and copyright lawsuits that have been filed against OpenAI, the developer of ChatGPT, along with many other generative AI product developers.
A primary issue concerning generative AI is the question of IP ownership and copyright. Traditionally, copyright has been granted to the creators, and had assumed the creators were human, but now with generative AI playing an active role in the creative process, determining ownership gets complicated. When a generative AI model generates something who owns the rights to what it created?
This past March (2023), the U.S. Copyright Office launched an initiative to examine the copyright law and policy issues raised by AI. This includes copyright in works generated using AI tools and the use of copyrighted materials in AI training. To address the copyright and registration of copyrighted material issues raised, the Office issued new registration guidance. The guidance covers the accountability to disclose the inclusion of AI-generated content in works submitted for registration. The Office indicated that later this year, they plan to publish a notice of inquiry to solicit public feedback on copyright issues arising from the use of AI. Until then the Office plans to host public sessions with creatives, lawyers, and Ai developers among others to learn more about the issues and challenges generative AI has introduced.
Interestingly, the US Copyright Office had previously taken the position that AI-generated works are not eligible for copyright protection if they are created by a computer program without any human input. This is because copyright law requires that a work be the product of "authorship" to be eligible for protection. However, there are recent cases where AI generated content may be considered for copyright protection. In these cases, humans must have significant input into the generated content creation, but don’t they already?
Just last year, a federal court in California ruled that a comic book generated by the AI tool developer Midjourney was eligible for copyright protection. The court found that the comic book was the product of human creativity, even though it was created using AI technology. The decision in this case (Anderson v. Midjourney) was a significant development in the law of AI copyright. It suggests that AI-generated content may be eligible for copyright protection in more cases than previously thought and at the same time it would seem to muddy the waters when attempting to develop regulatory guidelines around generative AI.
Attribution is another aspect tied to generative AI and intellectual property. Attribution is defined in the dictionary as “the action of ascribing a work or remark to a particular author, artist, or person.” Generative AI builds upon data it has been trained on or learned from and the content generated from this data may inadvertently incorporating copyrighted data from its training data raising concerns about potential copyright infringement and plagiarism. This is one area that regulators will need to keenly focus on. As AI models become both more sophisticated and creative the definition of “authorship” may get redefined.
Until more guardrails are established AI ethics and governance will play a big role in organizations use of AI. Both the NAIC and the White House announcements are good steps for IP rights as generative AI rapidly progresses, stakeholders must collaboratively establish ethical guidelines that strike a balance between innovation and safeguarding creative rights.
Generative AI is a new channel for both human and artificial creativity and will create new opportunities for almost every industry integrated with technology. However, its integration into the creative landscape also raises complex intellectual property challenges. Hopefully we can have balance and unlock the full potential of generative AI while respecting the values of intellectual property in this new age of artificial intelligence.
You can read more about intellectual property and other areas of risk with generative AI in our latest report Generative AI – Mitigating Risk To Realize Success: Life Insurance Edition.