AI, the FTC and Consumer Facing Applications: Some Guidance

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Key points:

  • Quietly changing the terms of service agreements could be unfair or deceptive: Any firm that reneges on its user privacy commitments risks running afoul of the law. It may be unfair or deceptive for a company to adopt more permissive data practices —for example, to start sharing consumers’ data with third parties or using that data for AI training — and to only inform consumers of this change through a surreptitious, retroactive amendment to its terms of service or privacy policy.
  • If you promise that you won’t use customer data for secret purposes, such as to train or update their models — be it directly or through workarounds — don’t. Doing so may be a violation of the law and the FTC has and will continue to require the unlawfully gotten data to be deleted.
  • Claims of privacy and security do not shield anticompetitive conduct. The FTC will closely scrutinize any claims that competition must be impeded to advance privacy or security.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations. Attorney Advertising.

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