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ARTICLE · 07 AUGUST 2024

Don't Buy The Buzzwords: "AI Washing" Gets Its Reckoning

Foley & Lardner LLP
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Since the release of ChatGPT 3.5 in November 2022, public interest in artificial intelligence (AI) has surged in a classic example of a hype cycle.

United StatesTechnology
Peter Fetzer
Peter Fetzer
Chanley Howell
Chanley Howell
James G. Lundy
James G. Lundy
William McCaughey
William McCaughey
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Since the release of ChatGPT 3.5 in November 2022, public interest in artificial intelligence (AI) has surged in a classic example of a hype cycle. As with past technological breakthroughs, companies may be tempted to overstate their AI capabilities to draw investor attention.

But that may be coming to a swift end as the U.S. Securities and Exchange Commission (SEC) has begun paying close attention to this "AI Washing" trend and warning organizations against overstatement.1

What is AI Washing?

"AI Washing" is the intentional overstating of a product or service's AI capabilities to make such product or service appear more innovative or intelligent than it actually is, and thus "artificially" inflating sales or engagement. The phrase stems from "greenwashing" (which itself came from "whitewashing"), a term frequently used to describe companies, products, or services that exaggerate their efforts to reduce environmental impact for the sake of appealing

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