AI – Friend or Foe?

Last Updated: March 28th, 2024

Artificial Intelligence (AI) is transforming the way we engage with technology and the internet. The rapid advancement of AI is significantly impacting intellectual property (IP) protection. If used lawfully and legitimately, AI can be a useful asset for brands in protecting their IP, as well as exploiting it.

Intellectual property encompasses a broad spectrum, including patents, trademarks, copyrights, and trade secrets. Each form of protection is designed to encourage innovation and creativity by granting exclusive rights to the creators. These rights, in turn, foster a climate where inventors and creators can confidently invest time, effort, and capital into ground breaking projects, secure in the knowledge that their innovations will be safeguarded from unauthorized use.

AI, with its capacity to analyse vast amounts of data, generate algorithms, and simulate human-like decision-making, has brought about large advancements in various sectors. However, this very capability poses a significant challenge to traditional IP protection mechanisms. The presence of AI is becoming more prevalent in society, and its significance in the business sector is poised to grow. According to the UK government, AI contributed £3.7bn to the UK economy last year, indicating a rising interest and investment in AI technology.

These innovative developments will have a positive impact on how we interact with technology and the internet. However, it is important to remember that there are also significant potential risks, with advancements moving at such a rapid pace that most AI tools on the market have not yet been fully explored and have little to no regulation in place. Even the likes of Elon Musk are among those who have called for greater research and regulation to ensure that AI is developed in an ethical manner.

In 2021, the European Commission (EC) proposed the Artificial Intelligence Act, designed to encourage AI developers in Europe to keep transparency and user safety front of mind by assigning applications of AI to three risk categories (unacceptable, high-risk and non-high-risk).

Significant debates are ongoing regarding the impact of AI on existing IP systems and whether AI-generated work can be protected through patents or copyrights in the same manner as human-generated work.

However, given the rapid pace of AI technology, it is crucial to regularly update legislation surrounding AI to keep it relevant and effective. Excessively rigid regulations can hinder progress, while a lack of regulation may lead to disruptive consequences that were not anticipated.

The European Commission’s Artificial Intelligence Act does not explicitly address the impact on intellectual property, creating uncertainty regarding the protection of IP rights. Similarly, the UK has limited legislation specifically designed to safeguard IP from risks associated with AI. Last year, the UK government initiated a consultation to determine whether copyright protection should extend to computer-generated works without a human author. As a result, UK law continues to protect such works. In China, courts have recognized that AI-generated content can be eligible for copyright protection when there is a certain level of human involvement in the creative process of an original work.

Under the current regulatory framework, the use of AI presents potential risks to the intellectual property (IP) of rightsholders, raising concerns regarding authorship, ownership, and copyright infringement. The output generated by AI systems relies on both user input and a vast dataset, much of which is sourced from the internet. By employing processes and rules to extract information from this extensive collection of human-generated text, it is highly likely that the content produced by AI will contain elements that already exist in literature or art.

As such, the original owner of the IP could potentially file a copyright infringement claim against either the AI generator or its creator. However, the treatment of such a legal case and the assignment of responsibility remain uncertain and there remains a question whether a claim could be brought against an AI generator. It is probable that developers of AI tools will need to demonstrate that they have implemented adequate safeguards to prevent IP infringement through their systems. Developers should strive to establish comprehensive rules and contracts with third parties, including artists, image library owners, and database owners, to govern the use of data for generating output. As for users of AI systems, they should ensure that any content they generate is thoroughly checked for potential infringement of third-party IP rights, particularly in commercial contexts.

Given the challenges faced by Intellectual Property laws in keeping pace with AI advancements, it is crucial for brands to familiarize themselves with the potential risks associated with AI-generated content. If a brand intends to utilize AI-generated content for marketing or product design purposes, it must be aware that such content may infringe upon third-party IP rights, such as trademarks or copyrighted images. Therefore, securing the necessary legal rights to use AI-generated content will be of utmost importance.

Companies need to be aware of the risks associated with IP when using AI tools. Any brand could now be susceptible to unintentional or intentional IP infringement at the hands of AI. In order to minimize these risks, companies should ensure they have strategies in place.

Steps companies could take to help protect IP:

  • conduct regular audits of IP assets to help identify and value assets that might not be protected.
  • although in the UK it is not possible to ‘register’ copyright (the right automatically subsists in an original work), using symbols such as the copyright sign © (meaning copyrights subsists in the work) or the trademark ® sign (‘r’ meaning the mark has been registered) can be a useful way to make others aware that you are aware of your rights.
  • consult IP specialists to establish what part of a creation can be protected.

Should you need any advice regarding protection of your intellectual property rights or alternatively, bringing a claim  where you consider someone has infringed your IP through the use of AI, please contact us. We can also draft contracts and settlement agreements and put the right structures in place, if negotiations in resolving a dispute are either just beginning or at an advanced stage.

Elliot McGahan

I am a member of the dispute resolution team and love every minute. It is demanding as you are required to assimilate detail very quickly and apply the law being better of course than the other side. I work with a strong team which is a privilege.

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