On September 8, 2022, the Brazilian Data Protection Authority (“ANPD”) launched a public consultation on the processing of minors’ personal data (encompassing children under 12-years-old and adolescents between the ages of 12- and 18-years-old).  The consultation will conclude on October 7, 2022.  According to the ANPD, the purpose of the consultation is to resolve divergent interpretations among public authorities, academics, privacy professionals, and representatives of civil society regarding the Brazilian Data Protection Law’s (“LGPD”) provision on the processing of minors’ personal data (Article 14).  The Authority will use the feedback it receives to draw up guidelines on the topic and, possibly, amend the LGPD.

On September 12, 2022, the U.S. Cybersecurity and Infrastructure Security Agency (“CISA”) published a Request for Information, seeking public comment on how to structure implementing regulations for reporting requirements under the Cyber Incident Reporting for Critical Infrastructure Act of 2022 (“CIRCIA”).  Written comments are requested on or before November 14, 2022 and may be submitted through the Federal eRulemaking Portal: http://www.regulations.gov.

In its August 5, 2022 affirmance of the district court’s grant of summary judgment, the Federal Circuit in Thaler v. Vidal ruled that the Patent Act unambiguously and directly answers the question of whether an AI software system can be listed as the inventor on a patent application. Since an inventor must be a human being, AI cannot be.

Judge Stark’s first authored precedential opinion since confirmation to the Federal Circuit aligns the U.S. position on whether AI can be listed as an inventor on a patent application with that of other major jurisdictions. Left for another day are questions such as the rights, if any, of AI systems, and whether AI systems can contribute to the conception of an invention.

PTO and Litigation Background of the DABUS Patent Applications

In July 2019, two patent applications were filed in the United States Patent and Trademark Office (PTO) that identified an AI system called DABUS (Device for the Autonomous Bootstrapping of Unified Sentience) as the sole inventor and Stephen L. Thaler as the Applicant and Assignee. DABUS, which was characterized as “a particular type of connectionist artificial intelligence” known as a “Creativity Machine” during prosecution and as “a collection of source code or programming and a software program” before the U.S. District Court for the Eastern District of Virginia, allegedly generated the subject matter of the two patent applications.

The filed patent applications specifically stated that the inventions were conceived by DABUS, and that DABUS should accordingly be named as the inventor. The PTO subsequently issued Notices stating that the applications did not identify each inventor by his or her legal name. In response to filed Petitions requesting that the PTO vacate the issued Notices, the PTO issued Petition Decisions refusing to vacate, explaining that a machine does not qualify as an inventor under the patent laws, and providing additional time to identify inventors by their legal name to avoid abandonment of the applications.

Thaler then sought judicial review under the Administrative Procedure Act in the Eastern District of Virginia, requesting an order compelling the PTO to reinstate the DABUS patent applications, and a declaration that a patent application for an AI-generated invention should not be rejected on the basis that no natural person is identified as an inventor. After briefing and oral argument, the district court issued an order denying Thaler’s requested relief and granting the PTO’s motion for summary judgment, recognizing the Federal Circuit’s consistent holdings under current patent law requiring inventors to be natural persons.

This is the fifteenth in a series of Covington blogs on implementation of Executive Order 14028, “Improving the Nation’s Cybersecurity,” issued by President Biden on May 12, 2021 (the “Cyber EO”).  The first blog summarized the Cyber EO’s key provisions and timelines, and the subsequent blogs described the actions taken by various Government agencies

The U.S. Securities and Exchange Commission (“SEC”) last week announced settlements with four investment advisory firms regarding alleged violations of the SEC’s pay-to-play rule, illustrating that federal regulators continue to aggressively pursue such cases.   The rule at issue, Rule 206(4)-5 (“the Rule”), prohibits investment advisers from, among other things, receiving compensation from certain government entities

On Thursday, September 15, 2022, an en banc panel of the Fourth Circuit Court of Appeals heard oral argument in the rehearing of an important case concerning the “knowledge” element of the False Claims Act—United States ex rel. Sheldon v. Allergan, No. 20-2330.  The panel was active, posing numerous questions for both parties during the oral argument, which spanned approximately 94 minutes. The audio recording of this hearing is available here.

As Covington has reported in the past, this appeal concerns questions related to the scope of the False Claims Act’s “knowledge” requirement. In its January 25, 2022 decision, the Fourth Circuit upheld the district court’s dismissal, finding that under the FCA “a defendant cannot act ‘knowingly’ as a matter of law if it bases its actions on an objectively reasonable interpretation of the relevant statute when it has not be warned away from the interpretation by authoritative guidance” and that “this objective standard precludes inquiry into a defendant’s subjective intent.”  United States ex rel. Sheldon v. Allergan Sales, LLC, 24 F.4th 340, 348 (4th Cir. 2022). That opinion was also subject to a strong dissent by Judge Wynn, which argued that the majority opinion disregarded two of the three FCA’s enumerated forms of knowledge (actual knowledge and deliberate ignorance), focusing only on the Safeco test for objective recklessness.

Last month, this blog covered the Eleventh Circuit’s denial of a petition to rehear Johnson v. NPAS Solutions, LLC, a decision that held that class action incentive awards are per se unlawful.  See 2022 WL 3083717 (11th Cir. Aug. 3, 2022).  That denial left the Eleventh Circuit as the only circuit where class action incentive awards can never be included in settlements under any circumstances. Now, the Department of Justice has relied on the Eleventh Circuit’s decision in Johnson to try to block class action incentive awards in a class action settlement with the federal government. 

Last December, President Biden issued Executive Order 14057, “Catalyzing Clean Energy Industries and Jobs Through Federal Sustainability,” which directed the government to adopt cleaner and more sustainable procurement practices, with the ultimate objective of net-zero emissions by 2050

Pursuant to that directive, GSA has issued a new RFI seeking information regarding domestically manufactured

With the growing use of AI systems and the increasing complexity of the legal framework relating to such use, the need for appropriate methods and tools to audit AI systems is becoming more pressing both for professionals and for regulators. The French Supervisory Authority (“CNIL”) has recently tested tools that could potentially help its auditors

On September 8 and 9, top trade officials of the United States and the other Indo-Pacific Economic Framework (“IPEF” or “Framework”) partner countries—Australia, Brunei Darussalam, Fiji, India, Indonesia, Japan, Republic of Korea, Malaysia, New Zealand, Philippines, Singapore, Thailand and Vietnam—launched formal negotiations in Los Angeles.

This marked the first in-person ministerial-level meeting since the IPEF launched on May 23, 2022 and follows three informal meetings since May 2022, the latest event being the virtual ministerial on July 26-27, discussed in detail in our previous post.

The Los Angeles ministerial involved intensive discussions on what to include in the scope of the Framework. Ultimately, the IPEF partners reached consensus on ministerial statements for each of the four IPEF framework pillars: Trade, Supply Chain, Clean Economy, and Fair Economy. All 14 IPEF partners have joined three of the pillars, and 13 joined the fourth—with just India opting out of the Trade pillar. While this near unanimous support for the four pillars is certainly a positive sign, the real work begins now.

This blog post summarizes how the ministerial statements characterize the four pillars and outlines next steps for the Framework and key remaining questions.

Takeaways from the Ministerial Statements

The ministerial statements confirmed the four pillars of negotiation and provided added clarity on the scope and content of each pillar. While the statements add little to the substance, they indicate a political commitment among the partners to the Framework.