Legal Hurdles in the Age of Artificial Intelligence: An Emerging Challenge 

Artificial Intelligence (AI) is transforming industries globally, offering unparalleled innovation and efficiency. However, this transformative power introduces complex legal and ethical challenges. While countries like the United States and the European Union have begun addressing these challenges, India’s legal framework is still evolving to accommodate the nuances of AI-driven advancements. 

This blog denotes the key legal hurdles arose out for AI in India and it is examining relevant statutory provisions, case law, and their broader implications for better 

Legal Provisions and Challenges

Intellectual Property Rights

The Copyright Act, 1957, requires human authorship for copyright protection, presenting a unique challenge for AI-generated content. Can AI be deemed an author under existing Indian law? While global precedents, like the US Copyright Office’s denial of copyright protection for AI-generated artwork, raise important questions, India’s Copyright Act has yet to address this gap. 

A judgement is the case of “Thaler v. US Copyright Office” where copyright for an AI generated artwork was denied, emphasizing the necessity of human authorship. In India, a hypothetical scenario could involve a tech company using AI-generated music for commercials. Without a clear legal framework, disputes may arise regarding ownership, leading to contractual complexities and potential misuse. 

Patentability of AI Inventions

The Patents Act, 1970, demands “novelty” and an “inventive step” for patent approval. However, when AI systems significantly contribute to the inventive process, determining the role of human intervention becomes contentious. Indian patent law does not yet provide clarity on this issue. 

In the landmark judgement of Stephen Thaler v Comptroller General of Patents Trademarks and Designs also known as “DABUS AI” case, the invention must be generated from a human source to be patented. In this case an AI system was listed as the inventor for a patent application in jurisdictions like the EU and US. Both denied the application, citing the lack of human inventorship. If a similar case were filed in India, this would likely reject it under current provisions of The Patent Act, 1970, leaving innovators in a legal grey area and which ultimately discourage inventors from research.

Liability and Accountability

AI systems, especially those with autonomous decision-making capabilities, complicate traditional liability frameworks. 

• Algorithmic Bias: Bias in AI models trained on flawed data can result in discriminatory outcomes. For instance, biased hiring algorithms can lead to lawsuits over workplace discrimination. In 2020, a global tech giant faced backlash when its AI recruitment tool demonstrated bias against female candidates.  

In India, such biases could result in violations of labour laws and anti-discrimination statutes, requiring judicial interpretation to define accountability. 

• Autonomous Systems: Self-driving cars and drones raise questions about liability in case of accidents. Should liability fall on the manufacturer, the user, or the AI itself? In a case involving Tesla’s Autopilot, courts in the US debated whether the accident’s fault lay with the driver or the system.  

If an incident occurred in India, existing tort law under negligence and product liability might struggle to assign responsibility, necessitating legislative reforms. 

Data Privacy and Security

The Information Technology Act, 2000, governs data protection but is ill-equipped to handle 

AI’s data-driven demands. Issues include: 

• AI Training Data: AI models often require vast datasets, potentially leading to misuse of personal information. 

• Upcoming Data Protection Bill, 2023: While promising, its effectiveness in addressing AI-specific challenges like facial recognition and surveillance remains to be seen. 

In the Supreme Court’s landmark judgment in K.S. Puttaswamy v. Union of India (2018) upheld privacy as a fundamental right. However, AI-driven surveillance tools, such as facial recognition systems used in law enforcement, raise questions about privacy infringement. For example, if a city deploys AI for crowd monitoring without safeguards, it could breach the privacy and leads to many law suits. 

Key Case Laws and Global Precedents

While Indian courts have yet to extensively deal with AI-specific cases, global precedents offer valuable insights: 

• Cambridge Analytica Scandal (2018): This case demonstrated how data misuse could manipulate political outcomes. Cambridge Analytica harvested Facebook data to influence voter behaviour in major elections, including the 2016 US Presidential Election. The fallout highlighted the urgent need for robust data protection laws globally. In India, it underscores the criticality of regulating data use in AI-driven applications, especially in politically sensitive contexts. 

• Gonzalez v. Google (2023): In the landmark case of Gonzalez v. Google LLC, the US Supreme Court examined whether platforms like YouTube, using AI-driven recommendation algorithms, could be held liable for content promoting terrorism. While the Court ruled in favour of Google, the case raised pivotal questions about AI’s role in amplifying harmful content. It highlighted the need for clarity on platform liability when AI systems influence user engagement and dissemination of content. 

• US Copyright Office Ruling: The refusal of copyright for AI-generated art in the US Copyright Office ruling underlines the global struggle to define authorship in the age of AI.  This case revolved around whether an AI system could be recognized as the creator of an artistic work. The decision concluded that the lack of human involvement precludes copyright protection, sparking debates on ownership and incentivizing human collaboration in creative endeavours involving AI systems. 

Regulatory Framework for AI in India

India’s approach to AI regulation is evolving, with several initiatives underway to address the challenges posed by this transformative technology. The Ministry of Electronics and Information Technology (MeitY) has published guidelines emphasizing responsible AI development, focusing on fairness, transparency, and inclusivity. Additionally, NITI Aayog, India’s policy think tank, has proposed a National AI Strategy aiming to leverage AI for economic growth while mitigating associated risks. 

However, the absence of a comprehensive AI-specific law remains a significant gap. While existing frameworks like the Information Technology Act, 2000, and the Data Protection Bill, 2023, cover some aspects, they do not address issues unique to AI, such as algorithmic accountability or autonomous decision-making. Regulatory sandboxes, as recommended by NITI Aayog, are being explored to test AI applications in controlled environments, ensuring safety and compliance before wider deployment. 

Moreover, collaboration with international bodies and adherence to global AI standards will be critical. India’s participation in global forums, such as UNESCO’s Recommendation on the Ethics of Artificial Intelligence, demonstrates its commitment to aligning domestic policies with international best practices. Moving forward, a unified regulatory framework tailored to India’s socio-economic context will be essential to balance innovation and ethical AI usage. 

Impact on Business and Society

Ethical Concerns 

• Algorithmic Transparency: Ensuring fairness in AI decision-making is critical to avoid discriminatory practices. Businesses deploying AI must provide transparency in their algorithms. Without clarity, users and regulators may question the fairness and accountability of these decisions.  

Lack of transparency also risks public trust in AI systems, potentially harming the reputation of companies using such technology. 

• Autonomous Weapons: The deployment of AI in military applications raises serious ethical and legal concerns. Autonomous weapons systems, if left unchecked, could lead to unintended escalation of conflicts and civilian casualties.  

For businesses involved in AI defence contracts, navigating the balance between innovation and ethical responsibility is crucial. Clear international frameworks will be needed to prevent misuse. 

Workforce Displacement

AI-driven automation threatens jobs in sectors like manufacturing and customer service. The government’s reskilling initiatives, such as those led by the National Skills Development Corporation (NSDC), are steps in the right direction but require scaling. To address this, companies must collaborate with policymakers to create reskilling programs.  

Failure to manage workforce displacement could lead to social unrest, increased unemployment, and reduced economic productivity. Governments and businesses need to invest in education and promote AI-related skills to prepare the workforce for future jobs. 

Surveillance and Civil Liberties

The use of AI in facial recognition and surveillance poses risks to individual freedoms. Balancing national security and privacy rights will be key, as highlighted by the Puttaswamy judgment. Excessive surveillance without clear oversight mechanisms can lead to authoritarian misuse and erosion of civil liberties. Businesses providing AI surveillance tools must advocate for responsible deployment policies.  

Conclusion 

India’s journey to address the legal hurdles of AI is at a nascent stage. Policymakers must strike a balance between fostering innovation and safeguarding rights. Clearer statutory provisions, informed by global best practices and tailored to India’s unique socio-economic context, are essential. 

AI’s potential to revolutionize industries is immense, but so are the challenges. By proactively addressing these hurdles, India can position itself as a leader in ethical and legally sound AI development. 

Disclaimer 

This blog is for informational purposes only and does not constitute legal advice. For specific legal concerns, consult a qualified attorney. 

REFERENCE: 

1. The Patents Act, 1970 

2. Stephen Thaler v Comptroller General of Patents Trademarks and Designs [2021] EWCA Civ 1374 

3. The Patents Act, 1977 

4. Thaler v. Perlmutter, Case 1:22-cv-01564-BAH (D.D.C., Aug. 18, 2023) 

5. The Copyright Act, 1957 

6. Justice K.S.Puttaswamy(Retd) vs Union Of India, AIR 2018 SC (SUPP) 1841, 2019 (1) SCC 

7. 1, (2018) 12 SCALE 1, (2018) 4 CURCC 1, (2018) 255 DLT 1, 2018 (4) KCCR SN 331 (SC), 

8. AIRONLINE 2018 SC 237 

9. The Information Technology Act, 2000 

10. History of the Cambridge Analytica Controversy, By Katie Harbath, Collier Fernekes 

11. Gonzalez v. Google LLC is 598 U.S. 617 (2023) 

12. The Data Protection Bill, 2023 

13. JUSTICE K S PUTTASWAMY (RETD.), AND ANR. vs. UNION OF INDIA AND ORS.  [2017] 10 S.C.R. 569