AI Update: AI Here To Stay, FTC Investigates ChatGPT, Repercussions For EU Regulation

Whether your firm likes it or not, AI-powered legal tech is here to stay, Assembly Software CEO Daniel Farrar writes in Forbes. "Scan the headlines, and it's evident that the use of generative AI will soon become commonplace in the industry," he says, adding that AI's ability to significantly increase the pace of lawyers' workflows will give firms that embrace the technology an edge against competitors.

Despite several judges having issued orders requiring attorneys to disclose their use of generative AI tools, many law firms haven't started investigating and reporting their own uses of AI, according to LegalTech News. Doing so would be "a significant undertaking for lawyers at a time where the technology is baked into a majority of the legal technology solutions on the market -- whether they realize it or not," the outlet writes.

Elon Musk has announced a new AI company with the vague goal to "understand reality," The Verge reports. This is Musk's second official foray into AI, the first being a stint at OpenAI starting in 2015 and ending in 2018 due to a conflict of interest between OpenAI and Tesla. Reuters characterizes the new company as intended to create a competitor to OpenAI's ChatGPT.

The FTC has opened an investigation into whether OpenAI, the company behind ChatGPT, has harmed consumers, the New York Times reports, citing concerns about the technology's data collection practices and potential to make false statements about individuals. "The investigation could force OpenAI to reveal its methods around building ChatGPT and what data sources it uses to build its A.I. systems," the Times states.

The Organisation for Economic Co-operation and Development (OECD) concluded in its recently published 2023 Employment Outlook that the law and finance sectors could face the most job loss due to AI implementation, The Guardian reports. The report goes on to urge organizations in affected industries to "make sure AI is used responsibly and in a trustworthy way in the workplace." Above the Law's Joe Patrice also weighed in.

The European Union's proposed AI Act, which introduces new language to describe specific types of AI for more detailed regulation, "is likely to have a more significant impact on U.S. companies than" 2018's General Data Protection Regulation (GDPR), Alexander Koskey and Vivian Peaden of Baker Donelson state in a recent blog post.

Ethan Beberness is a Brooklyn-based writer covering legal tech, small law firms, and in-house counsel for Above the Law. His coverage of legal happenings and the legal services industry has appeared in Law360, Bushwick Daily, and elsewhere.