On December 24, 2024, the Oregon Attorney General's Office issued guidance detailing how existing state laws apply to businesses utilizing artificial intelligence. This development is particularly significant for advertisers, as it underscores the necessity of aligning AI-driven marketing strategies with consumer protection laws to avoid committing unfair or deceptive acts or practices,
The guidance emphasizes that, despite the absence of AI-specific legislation, existing laws such as Oregon’s Unlawful Trade Practices Act (UTPA), the Consumer Privacy Act, and the Equality Act are applicable to AI technologies. For advertisers, this means that AI tools employed in marketing must comply with regulations designed to prevent consumer deception and protect privacy.
Here are some key considerations:
- Truthful Representations: Under the UTPA, any misrepresentation in consumer transactions is prohibited. Advertisers using AI-generated content must ensure that all claims about products or services are accurate and not misleading. For instance, utilizing AI to create fabricated celebrity endorsements without authorization could constitute a violation.
- Disclosure of AI Use: Transparency is crucial. If AI tools like chatbots are used to interact with consumers, it should be clear that the consumer is engaging with an AI and not a human representative. Failing to disclose this could be considered deceptive under the UTPA.
- Data Privacy Compliance: The Consumer Privacy Act grants consumers rights over their personal data. Advertisers must obtain explicit consent before using consumer data in AI models, especially when dealing with sensitive information. Additionally, consumers should have the option to opt out of data collection practices related to AI-driven marketing.
- Avoiding Discriminatory Practices: The Equality Act prohibits discrimination based on protected characteristics. AI systems used in advertising should be audited to prevent biases that could lead to discriminatory outcomes, such as targeting or excluding specific demographic groups unfairly.
Non-compliance with these laws can lead to significant legal and reputational risks. The guidance indicates that businesses may be held accountable for the actions of their AI systems, even if unintended. Therefore, it's imperative for advertisers to implement robust compliance measures, including regular audits of AI tools and thorough reviews of marketing content generated by AI.
The Oregon Attorney General's guidance serves as a critical reminder that existing consumer protection laws extend to the use of AI in advertising. Advertisers must exercise diligence in ensuring that their AI-driven marketing practices are transparent, fair, and compliant with applicable laws to safeguard consumer trust and avoid potential legal pitfalls.