Call 855-808-4530 or email [email protected] to receive your discount on a new subscription.
It feels like almost overnight, artificial intelligence (AI) has shifted the way companies run their businesses and serve their customers. As AI becomes increasingly mainstream, governments, industry organizations, and individual companies across the globe are grappling with how to address AI-specific risks without stymying research or innovation.
In the United States, the new administration has signaled it will not “helicopter-parent” AI development. In January, President Donald Trump announced a $500 billion private-sector investment into U.S.-based AI infrastructure and issued an Executive Order foreshadowing his administration’s intent to “remov[e] barriers” to AI development. Vice President JD Vance fleshed out the White House’s view, stating that “[e]xcessive regulation of the AI sector could kill a transformative sector just as it’s taking off.”
In the private sector, investment in AI has also increased at an exponential rate, with technology companies projected to spend over $320 billion on AI-related capital expenditures in 2025 alone. This immense capital contribution has been paired with a sharp increase in AI-specific public disclosures as companies strive to meet their obligations to keep stakeholders informed.
The Securities and Exchange Commission (SEC) and private shareholders have both displayed a keen interest in these disclosures. The SEC demonstrated a new focus on AI-specific enforcement actions in 2024 and brought enforcement actions against eight companies that purportedly oversold the capabilities of their AI technology or could not provide any support for their claims that they were using AI. In late February 2025, the SEC announced a task force focused in part on AI.
But looking back at the past year, the real headline may be in the civil litigation space. According to the Stanford Securities Class Action Filings tracker, approximately 7% of the federal securities class actions filed last year included AI-specific allegations, which is more than double the rate of AI filings in 2023.
Shareholders bring these claims under the antifraud provisions of the Securities Exchange Act, which prohibit companies and their directors and officers from making misstatements or omitting material information about the purchase or sale of securities. These regulations stand independent of any regulatory framework pertaining to the development and use of AI, a reality that is underscored by the filing of three new AI-related securities class actions so far this year.
Understanding the types of challenges shareholders are bringing against AI-affiliated companies is critical to effectively evaluating proposed disclosures and addressing potential areas of exposure.
The specific allegations featured in these lawsuits generally correspond to the type of company sued, roughly divided into companies: 1) developing and supporting AI technology; 2) integrating AI into their products and services; and 3) incorporating AI into their internal models and business systems.
Companies Developing and Supporting AI Technology
ENJOY UNLIMITED ACCESS TO THE SINGLE SOURCE OF OBJECTIVE LEGAL ANALYSIS, PRACTICAL INSIGHTS, AND NEWS IN ENTERTAINMENT LAW.
Already a have an account? Sign In Now Log In Now
For enterprise-wide or corporate acess, please contact Customer Service at [email protected] or 877-256-2473
This article highlights how copyright law in the United Kingdom differs from U.S. copyright law, and points out differences that may be crucial to entertainment and media businesses familiar with U.S law that are interested in operating in the United Kingdom or under UK law. The article also briefly addresses contrasts in UK and U.S. trademark law.
With each successive large-scale cyber attack, it is slowly becoming clear that ransomware attacks are targeting the critical infrastructure of the most powerful country on the planet. Understanding the strategy, and tactics of our opponents, as well as the strategy and the tactics we implement as a response are vital to victory.
The Article 8 opt-in election adds an additional layer of complexity to the already labyrinthine rules governing perfection of security interests under the UCC. A lender that is unaware of the nuances created by the opt in (may find its security interest vulnerable to being primed by another party that has taken steps to perfect in a superior manner under the circumstances.
In Rockwell v. Despart, the New York Supreme Court, Third Department, recently revisited a recurring question: When may a landowner seek judicial removal of a covenant restricting use of her land?