Artificial Intelligence, Real Liability: The Legal Risks Of "AI-Washing"

As corporates touting market-leading AI credentials continue to attract significant investor interest and outsized valuations, companies are increasingly facing allegations that they have engaged in "AI washing" – the term used to describe misrepresentations as to the usage, capability, or in some cases existence of AI in their operations, products or services.

Commercial incentives to overstate AI capabilities are compounded by board pressure to "act on AI", despite the fact that most boards lack adequate AI-related expertise. This challenge is exacerbated by widespread confusion as to the definition of AI, which encompasses a broad field of capabilities from machine learning to large language models and multi-modal generative AI.