AI Advertising: The FTC Prepares For Battle

On February 27, 2023, the Federal Trade Commission (FTC) published guidance aimed at artificial intelligence (AI) advertising claims. After the massively successful beta release of OpenAI's ChatGPT, many companies, big and small, are promoting AI as part of their products and many consumers are seeking AI products. However, several companies and consumers do not have a firm understanding of AI or its capabilities. The FTC instructs those who are marketing and selling products in this space to beware: "for FTC enforcement purposes [...] false or unsubstantiated claims about a product's efficacy are our bread and butter." It's important for companies that market technology, specifically AI, or utilize the technology itself to understand the FTC's evolving enforcement of AI claims to avoid future penalties.