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A consumer-focused backlash against ChatGPT has begun.
After stunning the world late last year with a vastly improved so-called chatbot, OpenAI, the startup that unleashed the unsettling — and often inaccurate — software into the world, is now the subject of a Federal Trade Commission probe.
On Thursday, the FTC sent a 20-page letter to OpenAI as part of an investigation into whether the chatbot has harmed consumers through its collection of data and publication of false information. The investigation, the latest in a long list of targeted but largely unsuccessful actions against Big Tech, was first reported by the Washington Post.
Microsoft Corp.
MSFT,
is a big investor in OpenAI.
“We think the backlash has been growing,” said Tim Giordano, a partner at the Clarkson Law Firm, which has filed class-action suits against both OpenAI and Google parent Alphabet Inc.
GOOG,
GOOGL,
Both lawsuits allege that the companies have engaged in theft of personal information and copyright infringement, among other allegations. “Personal data of every kind, especially conversational data between humans, is critical to the AI training process,” attorneys contend in the Alphabet lawsuit, filed earlier this week.
Giordano, whose firm is based in Malibu, Calif., noted that the backlash has intensified since Google updated its privacy policies earlier this month, disclosing that services from Bard to Cloud AI may be trained on public data scraped from the web.
“You can either use the internet and surrender all your personal and copyrighted information … to test volatile AI products … or not use the internet at all,” Giordano said. “The latter is not tenable, since our professional lives and our social engagement depend on the internet.”
Two additional class-action lawsuits have been filed this month by the Joseph Saveri Law Firm in San Francisco, with comedian Sarah Silverman as one of the three lead plaintiffs. One suit is against Open AI, and the other is against Meta Platforms Inc.
META,
both alleging that the companies’ artificial-intelligence models are being trained through the use of copyrighted materials from books written by the plaintiffs.
The FTC under Lena Khan needs a good case, after two years of setbacks in high-profile actions against tech giants. Just this week, a U.S. district court judge denied the FTC’s attempt to block Microsoft’s proposed acquisition of Activision Blizzard Inc.
ATVI,
on anticompetitive grounds. The FTC said it would appeal that decision.
With U.S. regulators weighing in on the precarious issues of artificial intelligence scarce — especially after a Senate subcommittee appeared stymied as to next steps after a single hearing — litigation is seeking to force some issues, especially those involving consumer data privacy.
“Congress is not set up to act as quickly as they need to, and, at the rate technology is going, the FTC and class actions will fill the critical gap,” Giordano said.
Whether the class actions filed against Alphabet and Meta will fuel further regulatory probes by the FTC is a question investors are likely pondering at the moment. The FTC will certainly continue to seek a big win in a big case.
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