Tech & Sourcing @ Morgan Lewis

While the regulatory landscape around artificial intelligence (AI) continues to evolve, navigating contractual arrangements and apportioning risk for the use of AI may seem like stepping into the unknown. In this blog post, we consider how a few familiar concepts within commercial contracts may be applied to the provision and use of AI tools as part of services.

The first half of 2023 was one of the most active six months for legislative and regulatory developments around artificial intelligence (AI). Our colleagues recently noted the European Parliament’s adoption of a draft AI Act as well as the significant activity in the United States related to regulating AI, both at the federal and state level. AI is also increasingly giving rise to data privacy concerns.

The EU-US Data Privacy Framework (DPF) became effective on July 10, and on the same day, the European Commission adopted an Adequacy Decision relating to the DPF, as a successor of the EU-US Privacy Shield. While only those companies subject to the jurisdiction of either the Federal Trade Commission or the US Department of Transportation are eligible to self-certify their compliance with the DPF, the scope of eligibility is likely to broaden in the future.

We recently wrote about the emerging trend of content moderation outsourcing. In this blog post, we turn our attention to another growing trend: legal process outsourcing.

Open-source software (OSS) representations and warranties are an integral part of the intellectual property (IP) representations and warranties in mergers and acquisitions (M&A) transactions and financings, as M&A transaction documents regularly include requests for a seller to represent and warrant that it has policies in place regarding the use of OSS, has provided such policies to the acquirer or investor, and has not deviated from such policies. These representations and warranties are important, but they are routinely and necessarily backstopped by the due diligence process.

Although the advent of readily accessible social media platforms has allowed for the proliferation of user content worldwide, there is increasing pressure on social media platforms and related companies to moderate the content that their users publish. Due to the decentralized nature of content sharing, companies are increasingly turning to third parties to handle their content moderation needs. As a result, content moderation has become one of the latest emerging trends in outsourcing services.

The UK government has released updates to its Digital, Data, and Technology (DDaT) Playbook, outlining guidance and relevant considerations for entities dealing with DDaT projects in this fast-changing sector. The DDaT Playbook works in conjunction with other publications from the Cabinet Office Sourcing Programme, such as the Sourcing Playbook.

Please join us on June 26, 2023 at 11:00 am–12:00 pm ET as Morgan Lewis partners Mike Pierides and Peter M. Watt-Morse examine highlights from our Tech & Sourcing @ Morgan Lewis blog as part of our Technology Marathon 2023 webinar series. In this webinar, the presenters will specifically discuss new developments in the understanding and contracting of artificial intelligence (AI) agreements.

As cybersecurity breaches remain a common threat globally, the UK government has published a cybersecurity breach survey detailing various cybersecurity policies, processes, and reliances for all types of business.

Please join us on June 20, 2023 at 11:30 am – 12:30 pm ET as Morgan Lewis partners Pulina Whitaker, Chris Warren-Smith, Alexander Bailly, and Ezra D. Church discuss recent collective action trends relating to privacy and cybersecurity through UK and EU perspectives for US companies.