Silent IP crisis brewing in an AI-driven economy

This article is authored by Daizy Chawla, senior partner, and Khushboo Tomar, principal associate, S&A Law Offices.

When we think of AI in India, the focus tends to be on the fancier, flashier and world’s ongoing trendiest AI apps for deepfakes of celebrities, AI film and video generation, conversational AI and chatbots to provide 24/7 answers to common customer queries and many more. While these are certainly sensational and get a lot of buzz, they can also distract us from a much bigger issue. Behind the scenes, a far more serious and slower-burning crisis is unfolding. AI is changing the underlying cognitive framework for protecting intellectual property in ways that our existing laws are deficient in preparedness.

AI

The use of AI is growing, and trademark liability is also occurring on a massive scale than before, moving away from the ways brand owners, platform operators were held accountable based on their actions or intent. As AI systems create names, logos, ads; the creation of a brand being used in an unlawfully infringing, passing-off, or diluting manner will still fall on the human or business entity controlling or receiving profit from the AI system (regardless if the entity acted negligently in approving or facilitating the creation); and the generation of these brands through AI will increase the likelihood of similarity, creating the likelihood of automated bad faith filings by individuals and the mass misuse of brands will expose the rights holder to challenges to their trademark's distinctiveness, likelihood of confusion, and bad faith conduct.

Emerging copyright liability is occurring across multiple avenues, from copying the copyrighted work during the creation of a dataset for machine-learning to producing results that closely resemble previously protected works; thereby challenging current definitions of authorship, ownership, and infringement under copyright law. Since most countries base their copyright system on human creativity, it is very unclear if pure or extremely AI-generated creations would have copyright protection or not. If there is uncertainty over the existence of copyright and the distribution of liability among developers, users, and deploying systems, then additional complications will arise due to the fact that AIs operate in a very opaque way which will complicate the processes for bringing enforcement action against and seeking accountability from individuals that infringe on copyrights directly, through contribution to others who infringe on copyright, or through vicarious liability; therefore, it becomes increasingly critical to obtain the proper licences, implement proper governance over datasets used to develop and test AIs; have the necessary contractual protections; and establish clearly defined regulatory requirements in order to manage copyright issues that arise as a result of developing and deploying AIs.

In an AI-dominated economy, laws concerning design liability are gradually becoming more convoluted given that AI has begun to participate, in an ever-expanding capacity, as a creator of product designs, user interfaces, and visual aesthetics without having any legal personality or authorship. The basis for the protection that is currently provided by India's Designs Act of 2000 is human originality and human ownership of designs; however, AI-generated or AI-assisted designs present new challenges to defining the author of a design as well as determining who is responsible for infringement of said design. Businesses will be exposed to infringement lawsuits if an AI system generating a design produces an infringing design even if there was no intention to copy.

Additionally, due to the potential for very high volumes of automated and AI-assisted design production, there is a risk that there will be two or more very similar designs, with one of the designs being a registered industrial design, entering the market at the same time, which will complicate the determination of whether a design is novel and/or has been published prior to the design date. Therefore, if a business relies on AI to identify similarities in designs or to gather evidence in a design infringement lawsuit, there is a very real concern regarding the credibility and reliability of any evidence obtained through AI because there will be little to no explanation as to how the AI reached its conclusion. Furthermore, as businesses continue to develop and market digital products and operate within virtual spaces, traditional boundaries defining article, and industrial application will continue to erode.

Consequently, in an era of AI, there is a greater burden placed on persons who deploy AI and persons/companies who benefit from the commercial use of AI to proactively clear design assets that they use, exercise errant human oversight on behalf of AI, and maintain records documenting their creative control over any designs entered into the marketplace.

As we move forward into the future of AI, we must continue to make strategic decisions to find a balance between protecting the creative rights of artists and the ever-evolving technology of AI. These laws should have an enforcement mechanism that provides both artists and AI developers with clear rules of the road moving forward in today's digital world.

This article is authored by Daizy Chawla, senior partner, and Khushboo Tomar, principal associate, S&A Law Offices.