2023 - Volume 2 - Summer - Flipbook - Page 3
Friend or Foe — Is Artificial Intelligence Worth
the Risk to Your Business?
By Robert Matsuishi and Connor L. Kridle
A New Era of Privacy Enforcement Has Begun in
California
By Travis Brennan and Lila Reiner
INTRODUCTION
California was the first state to enact a comprehensive consumer data privacy law, the California Consumer Privacy Act (“CCPA”), which took effect on
January 1, 2020. Civil Code §1798.100, et seq. Since
then, nine other states (Colorado, Connecticut, Indiana, Iowa, Montana, Tennessee, Texas, Utah and Virginia) have followed suit, enacting similar laws that comprehensively govern how businesses may collect, use and share
personal information. In November 2020, California separated itself from the pack yet
again with enactment of the
California Privacy Rights Act
(“CPRA”), a large package of
amendments to the CCPA that
became enforceable as of July
1, 2023. The CPRA ushered in a new era by creating
and funding the California Privacy Protection Agency
(the “Agency”), which is
charged with implementing and
enforcing the newly amended
CCPA. The Agency is the only
regulator in the United States
dedicated exclusively to data
privacy enforcement.
As artificial intelligence (AI) rapidly advances, its
integration into various industries brings forth an array
of benefits, revolutionizing efficiency and productivity.
However, alongside these transformative advancements
lie inherent risks that businesses
must navigate with caution. The
emergence of AI technology has
given rise to concerns surrounding trade secrets, employment
laws, and data privacy regulation. Businesses now find themselves in a complex landscape,
compelled to grapple with the
legal and ethical challenges
posed by AI while remaining
compliant as both employers
and market participants. In this article, we delve into
the multifaceted risks that AI presents for businesses
and explore how companies are being regulated in this
ever-evolving landscape.
Would you be surprised to learn
we didn’t write that paragraph?
ChatGPT did, in all of about
two seconds. This shows just a
fraction of the promise of AI
tools, and both businesses and
consumers are taking notice.
One IBM study indicated that
around 35% of companies globally had implemented AI in
their business by the start of
2022 and an additional 42% had reported that they
were exploring AI options. IBM Global AI Adoption
Index 2022. A Pew Research study also showed that
62% of Americans believe that AI will have a major
impact on jobs in the next 20 years and most Americans oppose the use of AI in making hiring decisions or
tracking employee productivity. AI in Hiring and Evaluating Workers: What Americans Think.
Businesses should take note
of the recent changes to the
CCPA and take action to ensure
that they will not be vulnerable
to Agency audits and enforcement actions. This article
reviews the core tenets of California’s privacy law,
describes key changes that are enforceable as of July
1, 2023, and makes recommendations to businesses to
help them navigate this new era of CCPA enforcement.
Summary of the CCPA
The CCPA’s core requirements apply to a
“business,” which is defined as any entity that “does
business in the State of California” and satisfies one or
more of the following thresholds: (1) has annual gross
revenues, from any source, in excess of $25 million;
(2) alone, or in combination, annually buys, sells, or
shares the personal information of 100,000 or more
consumers (California residents) or households; or (3)
Regulation follows innovation. The rapid development and adoption of AI technologies has led to increased regulatory attention and businesses are under
increasing scrutiny for their use of AI. Three areas
where this tension is palpable are trade secrets, em-Continued on page 8-
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