ChatGPT is likely to be a game-changer across multiple industries, but are businesses aware of the risks of ChatGPT? Businesses that want to increase efficiency and productivity are attracted to artificial intelligence (AI) to generate, in a matter of seconds, content that would take a human several hours to create. This blog addresses several legal implications to using ChatGPT that every business should consider.<\/p>\n
ChatGPT is an AI chatbot developed by OpenAI that can generate content in seconds. It is trained on a large dataset of over 45 terabytes of text data and continues to \u201clearn\u201d as more users engage with it.<\/p>\n
ChatGPT is a powerful new tool, and its uses are limitless. It can revise an essay, draft a letter, come up with advertisements, provide recipes, or engage in conversation. For example:
\no A realtor can ask ChatGPT to draft a listing for a particular address, and ChatGPT will spit one out in seconds.
\no A computer programmer can enter software code and ask ChatGPT to find errors.
\no A professor can ask it to write a whole exam.<\/p>\n
ChatGPT comes with risks. Before entering a prompt, ChatGPT lists several limitations. These include occasionally generating incorrect information, producing harmful instructions or biased content, and having a limited knowledge of the world and events after 2021. Other risks are also present.<\/p>\n
Privacy concerns arise because ChatGPT may collect and store whatever information a user inputs. So, for example, entering customer names and contact information risks exposing your customer\u2019s private information. Similarly, disclosing confidential information to ChatGPT could result in your company\u2019s trade secrets or other confidential information being shared with other users or losing legal protections.<\/p>\n
A company also may risk reputational damage based on its use of ChatGPT. It is possible that ChatGPT\u2019s responses may be perceived as offensive or may not align with your company\u2019s goals and values. Also, the fact that ChatGPT is being used at all may make one look insensitive or insincere in certain contexts. For example, a Vanderbilt administrator<\/a> sent an email to the student body to address the tragic mass shooting at Michigan State University. The email was later revealed to have been drafted by ChatGPT.<\/p>\n Legal exposure is also a significant risk of using ChatGPT. While a blog post cannot be exhaustive, below are a few examples.<\/p>\n The use of ChatGPT raises a host of legal issues, from employment law to intellectual property law. Legal landmines abound for those who are not careful to understand the limitations and risks of generative AI programs, like ChatGPT.<\/p>\n 1. Privacy Laws<\/strong> Because ChatGPT may store information that users input and then \u201ctrains\u201d on such information, ChatGPT may disclose confidential information shared with it if it is responsive to a prompt. In fact, the \u201cmassive collection and processing of personal data in order to \u2018train\u2019 the algorithms on which the platform relies\u201d led Italy to temporarily ban<\/a> ChatGPT until privacy concerns are addressed.<\/p>\n It is critical that businesses using ChatGPT do not disclose a customers\u2019 personal information or other confidential information subject to privacy laws. Doing so could risk liability for violating privacy laws or a contractual confidentiality obligation.<\/p>\n 2. Trade Secrets<\/strong> One large company has already accidentally leaked company secrets to ChatGPT. According to recent reports, three Samsung employees<\/a> used ChatGPT as part of their work and disclosed confidential information.<\/p>\n One employee copied and pasted into ChatGPT source code for a particular program and asked ChatGPT to identify errors. Another employee also shared code with ChatGPT and requested \u201ccode optimization.\u201d A third employee used ChatGPT to convert internal meeting notes, which contained confidential and sensitive information, into a presentation.<\/p>\n Not only does ChatGPT present a risk of losing trade secret protection through disclosure, but it also raises the risk that a user would be found to have not created the trade secret at all. If someone uses ChatGPT to develop a trade secret, it is unclear whether ChatGPT\u2019s contribution to the creation means that the person using ChatGPT can claim ownership of it from a trade secret standpoint. It is likely that the extent to which ChatGPT was used will be a major factor, but these are uncharted waters.<\/p>\n 3. Defamation<\/strong> In another instance, Professor Eugene Volokh<\/a> at UCLA Law School asked ChatGPT, \u201cWhat scandals have involved law professors? Please cite and quote newspaper articles.\u201d Not only did ChatGPT falsely accuse another prominent law professor of sexually harassing a student, but it also cited a nonexistent Washington Post<\/em> article as support. Instances of AI generating content that sounds plausible but is factually incorrect are referred to as \u201challucinations.\u201d<\/p>\n OpenAI, the organization behind ChatGPT, has already been threatened with a defamation lawsuit<\/a> after ChatGPT falsely stated an Australian mayor was convicted of a crime. But it is also possible that users who reproduce false information generated by ChatGPT, even unknowingly, could also be liable for defamation. Accordingly, businesses must not assume everything that ChatGPT generates is correct and should fact check ChatGPT-generated content, especially if it could be considered defamatory.<\/p>\n 4. Copyright<\/strong> Using ChatGPT can also affect your ability to copyright your own material. Consider an author who inputs a short story and asks ChatGPT to find spelling and grammatical errors or otherwise edit the story. The story may become part of ChatGPT\u2019s dataset and then be reproduced in response to someone else\u2019s prompt. If that person then copyrights the material first, it could affect the first author\u2019s ability to claim copyright protection.<\/p>\n Use of ChatGPT also affects whether a work can be copyrighted at all. Under U.S. copyright law, works created solely by a computer cannot be copyrighted. Instead, while machines may assist in creating a work, \u201csubstantial human involvement\u201d is required to obtain copyright protection.<\/p>\nWhat are the legal considerations for using ChatGPT?<\/h5>\n
\nPrivacy laws apply to almost every business. For example:
\n\u2022 Covered entities<\/a> under the Health Insurance Portability and Accountability Act (HIPAA) need to protect Protected Health Information, or PHI.
\n\u2022 Financial institutions are subject to the requirements of the Gramm-Leach-Bliley Act.
\n\u2022 Companies that violate their own privacy policies could face an enforcement action by the Federal Trade Commission (FTC) for engaging in unfair or deceptive acts or practices<\/a>.
\n\u2022 State laws, such as the California Consumer Privacy Act<\/a>, may also provide broad protections for consumers that businesses must abide by.
\n\u2022 And, companies operating in Europe, or even those outside Europe that still have European customers, need to comply with the General Data Protection Regulation<\/a> (GDPR).<\/p>\n
\nThe collection of, and \u201ctraining\u201d on, information input into ChatGPT has similar implications for a business\u2019s valuable trade secrets and other confidential information. For an owner of information to maintain trade secret protection under the Defend Trade Secrets Act<\/a> or similar state laws, the owner must take reasonable measures to keep that information secret. Disclosing confidential information to ChatGPT risks a court finding that the information is no longer a trade secret.<\/p>\n
\nBusinesses using ChatGPT also need to remain aware that the information ChatGPT generates may be inaccurate. It appears that ChatGPT aims to please and will create an answer even when one does not exist. In one experiment, a user input a fake link to a nonexistent New York Times<\/em> article and asked ChatGPT to summarize it. ChatGPT proceeded to provide a summary of the nonexistent article.<\/p>\n
\nChatGPT also has implications for copyright law. ChatGPT\u2019s large dataset includes a vast amount of publicly available information, which includes numerous copyrighted works. Because ChatGPT\u2019s responses are based on its dataset, its output could contain copyrighted material or be substantially similar to copyrighted material. A user may not know it and, believing the content to be original, publish ChatGPT-generated content and then inadvertently infringe someone else\u2019s copyright.<\/p>\n