Artificial intelligence can help businesses create marketing materials, website copy, contracts, customer communications, and internal documents in minutes. While these tools can improve efficiency, relying on AI-generated content without review can expose your business to legal and financial risk. Understanding those risks before publishing or using AI-created materials is an important part of protecting your company.
Businesses now use AI to draft emails, create marketing materials, summarize documents, and produce website content. Even so, AI-generated work should always be reviewed before publication or use.
What Legal Risks Can AI-Generated Content Create?
AI systems generate content based on patterns in existing data, not independent verification. As a result, mistakes, omissions, and inaccurate statements can occur.
Depending on how AI-generated content is used, businesses may face issues involving:
- Copyright infringement
- Trademark violations
- Defamation
- False or misleading advertising
- Privacy and confidentiality concerns
- Contractual liability
- Regulatory compliance violations
The level of risk often depends on how the content is used, whether it was reviewed by a person, and the industry in which your business operates.
Can AI-Generated Content Infringe Copyright?
Yes. Copyright questions remain one of the most discussed legal issues surrounding AI.
Some AI systems are trained using enormous collections of publicly available works. As a result, generated content may unintentionally resemble existing copyrighted material. Although AI rarely produces identical copies, there have been lawsuits alleging that AI developers used copyrighted works without permission during training, and businesses using AI-generated content should be aware that the legal standards continue to develop.
Businesses should also understand that copyright protection for AI-generated works is limited. Under current U.S. copyright law, works created entirely by AI generally are not eligible for copyright protection because copyright requires human authorship. In March 2026, the U.S. Supreme Court declined to review Thaler v. Perlmutter, leaving that requirement in place. Businesses seeking copyright protection should ensure meaningful human involvement in creating original content.
Could AI Create False or Misleading Business Content?
Yes. AI occasionally generates information that sounds convincing but is factually incorrect.
This can become problematic if your business publishes inaccurate statements about:
- Products or services
- Competitors
- Pricing
- Regulatory requirements
- Professional qualifications
- Consumer guarantees
False statements may create liability under advertising, consumer protection, or defamation laws. Your business remains responsible for what it publishes, even when AI generated the content.
Are There Privacy and Confidentiality Concerns?
Businesses should be careful about what information they enter into AI platforms.
Depending on the platform, information entered into an AI system may be stored or used to improve future models. Businesses should avoid entering confidential information, customer data, trade secrets, or other sensitive records into public AI tools.
Before adopting AI tools, businesses should establish clear internal policies regarding:
- Confidential information
- Client or customer data
- Employee information
- Sensitive business records
- Approved AI platforms
These policies can help reduce the likelihood of accidental disclosures.
How Can Businesses Reduce Legal Risk When Using AI?
AI can be a valuable business tool when paired with appropriate oversight.
Some practical steps include:
- Review all AI-generated content before publication.
- Verify factual statements using reliable sources.
- Check for possible copyright or trademark concerns.
- Avoid entering confidential or proprietary information into public AI systems.
- Develop internal policies governing employee use of AI.
- Consult legal counsel before relying on AI for contracts, compliance documents, or other significant business communications.
Human review remains one of the best safeguards against legal problems.
Does Pennsylvania Law Specifically Regulate Business Use of AI?
Pennsylvania does not currently have a comprehensive law governing business use of artificial intelligence. However, lawmakers have introduced proposals addressing certain AI uses, reflecting growing attention to consumer protection and AI governance.
Businesses remain subject to existing laws involving contracts, consumer protection, intellectual property, privacy, employment, and unfair competition. Federal agencies have also increased scrutiny of AI-related practices involving misleading claims, misuse of consumer information, and other legal violations.
Protect Your Business While Embracing New Technology
Artificial intelligence offers significant opportunities for businesses, but it should be viewed as a tool rather than a substitute for sound legal judgment. Careful review, clear internal policies, and thoughtful implementation can help reduce the risk of disputes while allowing your company to benefit from new technology.
At Jones, Gregg, Creehan & Gerace, we help Pennsylvania businesses address legal issues involving technology, contracts, intellectual property, business operations, and risk management. If you have questions about using AI-generated content in your business or want to develop policies that protect your company, contact us to discuss your legal needs.