#HelloWorld. Spring has sprung. While the EU AI Act receives wall-to-wall coverage in other outlets, this issue highlights recent rules, warnings, and legislative enactments here in the U.S. And it ends on a personal, meditative note from an AI user, worth a read. Let’s stay smart together. (Subscribe to the mailing list to receive future issues.)
In light of the EU’s AI legislation, Duane Morris partner Agatha Liu tells Vogue Business that fashion brands to adopt a customer-centric approach, prioritizing transparency and providing consumers with comprehensive insights into AI-driven processes. The Act’s focus on eradicating bias underscores the importance of inclusive AI models within the fashion industry. Read the full article on the Vogue Business website.
#HelloWorld. Much to catch up on from February and the first half of March. In this issue, we cover the latest AI activity from Europe, as well as a bevy of guidance and updates from U.S. agencies. Off to the races. Let’s stay smart together. (Subscribe to the mailing list to receive future issues.)
Kelly Bonner and Agatha Liu of Duane Morris LLP shared their insights and experience with CosmeticsDesign on the risks of incorporating AI technology into business practices, and how can beauty companies protect themselves.
Common uses for AI in beauty & associated risks
One of the most common uses for AI technology is personalizing products and offering personalized product recommendations. “As beauty has become increasingly personalized,” Bonner explained, “companies are increasingly deploying AI technologies to enable customers to visualize new looks (virtual try-on tech) or communicate with customers via chatbots that act as virtual assistants and offer personalized product recommendations.”
With the advent of generative AI models like Med-PaLM and ChatGPT, providers can now type complex medical questions into a chat box and receive sophisticated (and hopefully accurate) answers. This ability surpasses previous AI applications in the potential to serve patients, but also in the potential to run afoul of laws like corporate practice of medicine (CPOM) rules, the False Claims Act (FCA), and FDA regulations. These concerns — on top of the risk of a generative AI model fabricating answers, known as “hallucinations” — mean that providers should proceed with extreme caution before implementing generative AI tools into their practices.
Read the full article by Matthew Mousley on the Wharton Healthcare Quarterly website.
Duane Morris’ Agatha Liu and Kelly Bonner were interviewed by Personal Care Insights about the challenges and opportunities beauty companies face while using AI to appeal to younger consumer demographics. Below is an excerpt of the article.
How does the competitive landscape of the beauty industry impact businesses’ use of AI technologies, especially when it comes to targeting younger consumer segments?
Bonner: The highly competitive nature of the beauty industry, with its desire to appeal to younger consumers, is certainly a key driver in beauty brands embracing AI tools to offer enhanced customer shopping experiences.
Can you provide some context about US AI regulations that the beauty industry should know? What do you expect is coming, especially considering the AI Act in the EU?
Liu: The EU AI Act imposes specific obligations on the providers and deployers of so-called high-risk AI systems, including testing, documentation, transparency and notification duties.
To read the full interview, please visit the Personal Care Insights page.
Duane Morris partner Agatha Liu spoke with Personal Care Insights on potential risks, including personalization, appearance bias and regulatory compliance, as beauty companies integrate AI technologies.
How do you perceive the potential risks associated with integrating AI technologies to enhance customer experiences in the beauty industry?
Liu: In the beauty context, it’s important for companies to be aware of potential pitfalls in integrating AI technologies like virtual try-on technology (VTO), automated product or service applications or chatbots that act as virtual assistants and offer real-time, responsive product recommendations. These risks can include a lack of accuracy, lack of propriety (possibly giving offense), invasion of consumer privacy or possible IP infringement.
Read the full interview on the Personal Care Insights website.
Privacy and data breach class action litigation, as well as AI issues, are among the key issues that keep businesses and corporate counsel up at night. There was over $1 billion procured in settlements and jury verdicts over the last year for these types of “bet-the-company” cases. At the ALM Law.com Legalweek 2024 conference in New York City, Duane Morris partner Alex W. Karasik was a panelist at the session “Trends in US Data Privacy Laws and Enforcement.” The conference, which had over 6,000 attendees, produced excellent dialogues on how cutting-edge technologies can potentially lead to class action litigation.
In Mobley v. Workday, Inc., Case No. 23-CV-770 (N.D. Cal. Jan 19, 2024) (ECF No. 45), Judge Rita F. Lin of the U.S. District Court for the Northern District of California dismissed a lawsuit against Workday involving allegations that algorithm-based applicant screening tools discriminated applicants on the basis of race, age, and disability. With businesses more frequently relying on artificial intelligence to perform recruiting and hiring functions, this ruling is helpful for companies facing algorithm-based discrimination lawsuits in terms of potential strategies to attack such claims at the pleading stage.
Read more on the Duane Morris Class Action Defense Blog.
Artificial intelligence (AI) can enhance efficiencies in providing healthcare in many ways, one of which is by utilizing algorithms to read medical records and thereby assist providers in better understanding their patients and treatments that may be available. Increasingly, electronic medical review (EMR) software companies are utilizing AI to boost their products, offering hospitals, healthcare facilities, and physicians powerful tools that can enhance their decision-making as to operations and treatment.
