Artificial Intelligence (AI) is everywhere and is powering chatbots, approving loans, diagnosing illnesses, and even making hiring recommendations. These systems promise efficiency and accuracy, but what happens when AI gets it wrong? From wrongful arrests due to faulty facial recognition, to biased hiring decisions, to misdiagnoses in healthcare, AI errors can have serious legal and financial consequences. The pressing question is who’s liable? In the U.S. and globally, the law is still catching up. Liability for AI errors can depend on factors such as: (1) the role of human oversight; (2) whether the harm was foreseeable; (3) the contractual relationships between parties; and (4) applicable statutes, case law, and regulatory guidance. This article explores product liability, professional liability, data protection laws, and contractual risk allocation to help businesses and professionals understand who’s responsible when AI makes a mistake.
Why AI Mistakes Are Different from Human Errors
AI is not a “person” under the law. It cannot be sued, fined, or jailed. So, the responsibility flows to humans and organizations but pinpointing which party is responsible can be complicated for obvious reasons.