The Future of AI & Materials: Major Lawsuits, Breakthroughs, and Policy Shifts

UWCISA Blog · The Future of AI & Materials: Major Lawsuits, Breakthroughs, and Policy Shifts

JD Vance Slams AI Regulations, Widening U.S.-Europe Divide

At the Artificial Intelligence Action Summit in Paris, U.S. Vice President JD Vance criticized Europe’s stringent AI regulations, arguing they could stifle innovation. His remarks highlighted a growing global divide on AI governance, with the U.S. favoring minimal restrictions, Europe enforcing strict policies, and China expanding state-backed AI. The U.S. notably abstained from signing a global AI pledge signed by over 60 nations, including China, further isolating itself on the issue. Vance’s speech, his first major policy address as vice president, framed AI as a pivotal economic force and emphasized the Trump administration’s commitment to free-market AI development. European leaders, however, defended their approach, citing safety and public trust. Meanwhile, China promoted open-source AI while simultaneously tightening domestic controls. The summit underscored the global power struggle over AI dominance, as well as growing tensions between the U.S. and its allies over regulatory approaches.

Key Takeaways:

• U.S. vs. Europe on AI: Vance warned that overregulation could hinder AI innovation, putting the U.S. at odds with Europe’s strict oversight.
• China’s AI Strategy: China supported a global AI pledge while expanding state-backed AI at home, further complicating the international landscape.
• Global AI Race: The summit revealed intensifying competition between the U.S., Europe, and China to set AI standards and maintain technological leadership.

(Source: CTV News)

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AI Copyright War: Cohere Faces Lawsuit from Leading Media Companies

A coalition of major publishers, including The Toronto Star, Forbes, The Atlantic, The Guardian, Vox Media, and Politico, has filed a lawsuit against Canadian AI firm Cohere, alleging that the company used copyrighted content without permission to train its generative AI models. The lawsuit, filed in a New York court, demands damages and a permanent injunction to prevent Cohere from reproducing their work. The plaintiffs argue that AI companies profiting from journalism without compensation threaten the media industry, which is already struggling with declining ad revenue. Cohere, valued at $5.5 billion, dismissed the lawsuit as “misguided and frivolous,” asserting that it follows responsible AI training practices. The case is part of a growing legal battle between publishers and AI firms, as media companies push for legal precedents to protect journalistic content from unauthorized AI use.

Key Takeaways:

• Publishers vs. AI: Major media companies accuse Cohere of using their content without permission and demand financial compensation.
• AI Copyright Challenges: The case reflects broader legal battles as publishers seek to establish protections against unauthorized AI training on their work.
• Cohere’s Response: The AI company denies wrongdoing, calling the lawsuit baseless and insisting it adheres to responsible AI practices.

(Source: The Star)

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Microsoft Study Warns AI Dependence Erodes Critical Thinking

A new study by Microsoft and Carnegie Mellon University warns that excessive reliance on AI tools can erode critical thinking skills. Researchers found that knowledge workers who trusted AI to complete tasks tended to disengage mentally, particularly with low-stakes work, leading to diminished problem-solving abilities. The study also highlighted that AI-assisted users produced less diverse solutions, raising concerns about creativity and independent thought. Conversely, those skeptical of AI’s accuracy were more likely to engage critically and improve AI-generated content. While AI can enhance efficiency, the study cautions against overdependence, as it may weaken cognitive skills over time.

Key Takeaways:

• AI Weakens Critical Thinking: Workers relying heavily on AI became less engaged and struggled to think independently.
• Reduced Creativity: AI users generated more homogenous results compared to those working without AI assistance.
• Over-Reliance Risk: While AI can improve efficiency, blindly trusting it may lead to cognitive decline and poor decision-making.

(Source: Gizmodo)

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Altman Dismisses Musk’s OpenAI Takeover Bid as a ‘Disruption Tactic’

OpenAI CEO Sam Altman has dismissed Elon Musk’s $97.4 billion takeover bid as a “tactic to mess with us,” asserting that the nonprofit controlling OpenAI is not for sale. While Musk’s lawyer claimed the offer was sent to OpenAI’s outside counsel, Altman stated that the board had not officially received or reviewed it but planned to reject it. Musk, who co-founded OpenAI in 2015 before leaving over strategic disagreements, has since launched his own AI company, xAI. The bid comes as OpenAI seeks $40 billion in funding to transition into a for-profit entity, raising legal questions about how nonprofit assets are valued in the shift.

Key Takeaways:

• Altman Rejects Musk’s Bid: OpenAI’s CEO dismissed Musk’s $97.4 billion takeover offer as a disruption tactic, insisting the company is not for sale.
• Nonprofit to For-Profit Transition: OpenAI’s planned shift to a for-profit model is under legal scrutiny to ensure fair valuation of its nonprofit assets.
• Musk’s AI Ambitions: Having left OpenAI, Musk now leads xAI and remains a key player in the AI industry, further complicating his takeover attempt.

(Source: Reuters)

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Waterloo Researchers Develop Sustainable Graphene Ink for Industry & Environment

Researchers at the University of Waterloo have developed an eco-friendly, 3D-printable graphene ink that could revolutionize applications in healthcare, industry, and environmental science. Unlike traditional graphene powders, which are difficult to manipulate, this water-based ink maintains conductivity without requiring chemical additives or solvents.

Key Takeaways:

• Breakthrough in Graphene Printing: Researchers created a 3D-printable, eco-friendly graphene ink that maintains conductivity without chemical additives.
• Wide Applications: The ink could be used for wearable sensors, lightweight automotive parts, printed electronics, and environmental cleanup.

(Source: University of Waterloo)

Author: Malik Datardina, CPA, CA, CISA. Malik works at Auvenir as a Sr. AI Product Manager who is working to transform the engagement experience for accounting firms and their clients. The opinions expressed here do not necessarily represent UWCISA, UW, Auvenir (or its affiliates), CPA Canada or anyone else. This post was written with the assistance of an AI language model. The model provided suggestions and completions to help me write, but the final content and opinions are my own.

Five Top Tech Takeaways: AI Rapping Mona Lisa, Calls for AI Oversight, AI in the Banks, AI Art Receives Limited Copyright and Meta Competes with ChatGPT

Lights, Camera, Robots!

Movie Maker's Dream or Deep Fake Nightmare? Microsoft's AI Animates Art with Caution

Microsoft's latest AI innovation, detailed by their researchers last week, introduces an AI model capable of animating still images into realistic videos synchronized with audio. The VASA-1 technology can produce lifelike animations from photos, artwork, or cartoons, featuring accurate lip-syncing and naturalistic movements of the face and head. Demonstrated with a video of the Mona Lisa rapping a comedy piece by Anne Hathaway, the technology aims to enhance educational tools, assist individuals with communication challenges, and possibly create virtual companions. 

However, concerns about potential misuse for impersonation and misinformation persist. Microsoft has decided to withhold the public release of VASA-1 to ensure responsible use, aligning with practices of cautious distribution similar to their partner OpenAI's approach with the AI video tool, Sora.

Author's note: As discussed in these two posts (here and here), the possibility of creating a Hollywood studio in one's garage is becoming more realistic. Many will highlight the challenges posed by deepfakes, which are undoubtedly significant. However, there is also a positive aspect to consider. These tools could potentially enable artists to tell their stories through a cost-effective model. In fact, Tyler Perry halted his $800 million studio construction plan, influenced by the advanced visual effects achievable through OpenAI's Sora, demonstrating the shifting economic landscape of Hollywood production.

Key Takeaways:

• Microsoft's new AI, VASA-1, animates still images into realistic videos with natural movements and synchronized audio.
• The technology showcases potential uses in education and accessibility, yet also raises significant concerns about misuse for creating false representations.
• Microsoft is withholding VASA-1's public release, focusing on responsible and regulated technology deployment.

(Source: CTV News)

For the original Microsoft post and more videos, see here. 

Former OpenAI Board Member Calls for Regulatory Oversight in AI

Former OpenAI board member Helen Toner advocated for increased transparency and regulation in the AI industry during a TED talk in Vancouver. Toner emphasized the necessity for AI companies to publicly disclose details about their technologies' capabilities and risks, and to implement robust data collection systems to address incidents. She proposed the establishment of "AI auditors" to ensure that companies are held accountable, rather than self-regulating, reflecting on her experiences and challenges, including her controversial tenure on OpenAI's board.

Key Takeaways:

• Helen Toner, ex-OpenAI board member, stressed the importance of AI companies being transparent about their technologies and the associated risks.
• Toner proposed the creation of independent "AI auditors" to oversee company practices and enhance accountability in the industry.
• Reflecting on her own experiences, Toner highlighted the need for effective incident reporting mechanisms within AI companies, akin to those in aviation.

(Source: Bloomberg)

Jamie Dimon Outlines AI’s Role in JPMorgan’s Future in Shareholder Letter

In JPMorgan Chase's latest shareholder letter, the critical role of artificial intelligence (AI) in the firm's growth and operations was highlighted. Over the past decade, the firm has significantly expanded its AI capabilities, now boasting over 2,000 AI and machine learning (ML) specialists and a robust portfolio of over 400 AI-driven use cases across various business sectors like marketing, fraud, and risk management. The firm is also exploring generative AI's potential to enhance software engineering, customer service, and general productivity. Recognizing AI's importance, a new executive role—Chief Data & Analytics Officer—has been established to ensure AI and data are integral to decision-making processes company-wide.

Key Takeaways:

• JPMorgan Chase has developed extensive AI and ML capabilities, with over 2,000 experts and 400 active AI use cases driving business improvements.
• The firm is actively exploring generative AI applications to reimagine business workflows and enhance overall productivity.
• A new executive role, Chief Data & Analytics Officer, has been created to integrate AI deeply into the company’s strategic and operational decisions.

(Source: JPMorgan Chase)

GenAI, Art, & Copyrights: USCO Grants Limited Copyright for AI-Assisted Work

Elisa Shupe successfully obtained copyright registration for her AI-assisted novel, "AI Machinations: Tangled Webs and Typed Words," from the US Copyright Office (USCO). Shupe extensively used OpenAI's ChatGPT while writing the book and initially faced rejection from the USCO. However, with the help of the Brooklyn Law Incubator and Policy Clinic, Shupe appealed the decision, arguing that she used ChatGPT as an assistive technology due to her disabilities. The USCO granted Shupe copyright for the selection, coordination, and arrangement of the AI-generated text, but not for the actual sentences and paragraphs. This decision is seen as a significant marker in how the USCO is grappling with the concept of authorship in the age of AI.

Key Takeaways:

• The US Copyright Office granted Elisa Shupe copyright registration for her AI-assisted novel, recognizing her as the author of the selection, coordination, and arrangement of the AI-generated text.
• Shupe's case highlights the nuances and challenges the USCO faces in determining the scope of protection for works produced using AI.
• The decision to grant Shupe a limited copyright registration is seen as a compromise, as she believes she should be able to copyright the actual text of the book due to her extensive involvement in the creative process.

(Source: Wired)

Explore Meta's Latest AI Innovation: Llama 3

Meta has introduced Meta Llama 3, their newest large language model (LLM), marking a significant advancement in AI capabilities. Llama 3, which includes models with 8B and 70B parameters, boasts state-of-the-art performance in various AI benchmarks and supports a wide range of applications with improved reasoning and coding abilities. These models will soon be available across major cloud platforms and feature enhancements in trust and safety with tools like Llama Guard 2 and CyberSec Eval 2. Meta's commitment to open-source development continues with the release of Llama 3, aimed at fostering innovation and responsible use in the AI community. 

Note: Meta.ai is available in Canada and you can try it out, here: https://www.meta.ai/

Key Takeaways:

• Meta Llama 3 introduces enhanced large language models with 8B and 70B parameters, setting new standards for AI performance and capabilities.
• The models are part of Meta's open-source initiative, ensuring broad accessibility and encouraging community-based innovation and development.
• Meta emphasizes responsible AI development, incorporating advanced safety features and guidelines to support secure and ethical usage.

(Source: Meta)

Author: Malik Datardina, CPA, CA, CISA. Malik works at Auvenir as a GRC Strategist who is working to transform the engagement experience for accounting firms and their clients. The opinions expressed here do not necessarily represent UWCISA, UW, Auvenir (or its affiliates), CPA Canada or anyone else. This post was written with the assistance of an AI language model. The model provided suggestions and completions to help me write, but the final content and opinions are my own.

The Dilemma of Zlibrary: Empowering Students or Enabling Piracy?

As the year 2022 came to a close, a significant event occurred that may have gone unnoticed by many. The famous online repository of ebooks and articles, Z-library, was shut down. This event serves as a reminder of how too much attention can have negative consequences. In this blog post, we will delve deeper into the story of Zlibrary and the issues surrounding shadow libraries, intellectual property rights, and access to knowledge.

 

The Impact of Digitized Info: The Rise of Z-library

Z-library is an online repository of ebooks and articles that provides free access to information and knowledge. The site started in 2009 and has since grown to be one of the largest shadow libraries on the internet. According to Fast Company:

"Z-Library offered more than 10 million ebooks and 86 million articles at its peak, with a limited number of monthly downloads accessible to millions of users free of charge, and more available for a small fee."

Many people around the world rely on such resources as they may need access to the expensive subscription-based services that are often required to access academic articles and books. Proponents of websites like Zlibrary, Sci-Hub, and Libgen argue that they strive to break down barriers to knowledge and education, enabling users to access the information they need to learn and grow.

The TikTok Effect on Zlibrary: More Popularity, More Problems

The rising popularity of Z-library, however, attracted the scrutiny of copyright holders and legal authorities, putting both the site and its users in a vulnerable position. The increased attention also raised legal questions about using such a resource.

 According to TorrentFreak, Z-library has emerged as a vastly popular, high-volume source of illegal ebook downloads in recent years. The site's growth can be attributed to users who openly advertise the site on social media, with TikTok playing a significant role in its popularity. The hashtag #zlibrary on the popular social media platform has 4 million views, with countless videos posted by college and high school students and others across the world promoting it as the go-to place for free ebooks.

However, the attention that Zlibrary received on TikTok was a double-edged sword. While it certainly helped spread the word about the site, it also brought more attention to its illegal activities. This attracted the attention of copyright holders and legal authorities, namely the FBI.

Starving Students vs Starving Artists: Who really benefits from the closure of Z-library?

According to the Washington Post, the FBI has charged two Russian nationals, Anton Napolsky and Valeriia Ermakova, with criminal copyright infringement, wire fraud and money laundering for operating Z-Library. The authorities took down the website on November 4th and the U.S. Attorney for the Eastern District of New York, Breon Peace, stated that the defendants profited illegally by uploading works within hours of publication and victimized authors, publishers, and booksellers in the process.

The Washington Post also noted how authors and users had a clash of opinions. Users were mourning the loss of their ability to download free textbooks, novels, and academic papers. However, authors were relieved by the shutdown as they argued that piracy harms their sales and the publishing industry and that mourning Z-library is mourning the end of theft.

But is this really a debate between starving students and starving artists? Not really.

According to a report by Citigroup obtained by Rolling Stone, in the music industry's digital streaming era, the people who make the most money from copyrighted content like books or music are not the artist/author, but the holder of the copyright. They take nearly 90% of the money.

The story of Jerry Siegel and Joe Shuster, the authors of the original Superman comic book, highlights the unfortunate reality that creators of copyrighted content may not always receive fair compensation for their work. Despite the immense success and wealth generated by Superman and the concept of superheroes, the inventors only received a small sum of $130 for signing over the rights to their creation to D.C. Comics. This has led to ongoing legal battles, with the families of the inventors seeking their fair share of the fortune generated by the invention. Of course, the copyright holders won.

The Z-library Takedown: Can we just dismiss the concern of students?  

One tweet succinctly summed up the students' feelings, stating "The closure of Zlibrary is like the burning of the Library of Alexandria in our time." This tweet draws parallels between the loss of this online library and the historical burning of the Library of Alexandria during the reign of Julius Caesar.

Burning Z-Library: Rendered by Stable Diffusion 2.1

Can we just dismiss this as students being overly emotional? Well, it's more complicated than that.

As noted in the Huntington News, a 2014 study found that the average cost of a college textbook is about $105, which is difficult to justify for most college students. In the same study, 65% of college students said they didn't purchase their required textbooks even though they knew it could hurt their grade.

The burden of student debt is heavy for many young people in Canada and the U.S. In Canada, the total amount of student loans owed to the federal government reached a staggering $22.3 billion in 2020. And this figure doesn't even consider provincial and personal loans, lines of credit and education-related credit-card debt. On average, a Canadian student graduating with a bachelor's degree holds $28,000 in student loan debt, while college grads hold $15,300 in debt. In the U.S., the situation is similarly dire. For 2023, the total amount of student loan debt (including federal and private loans) has reached $1.75 trillion. The average student borrower holds $28,950 in debt.

The situation in Canada and the U.S. has a wide-reaching social impact, as this debt load can make it difficult for young people to start their careers, buy homes, or even save for retirement. It is clear that the cost of education is a growing concern not just for students but for society as a whole.

Consequently, the Z-library debate must be connected to the economic reality that students face, such as the rising costs of education, high levels of student debt, and a lack of affordable access to educational resources. It highlights how the students' anger at the site's shutdown is a part of a broader crisis they face. It is essential to understand this context when discussing the issues surrounding shadow libraries and intellectual property rights.

Digital Tech: Innovation and the Struggle for a Knowledge Society

The Z-library debate highlights how intellectual property can be an obstacle to creating a knowledge society. From a technological standpoint, the ability to digitize text, information, and knowledge can revolutionize access to information and education. However, as demonstrated by Zlibrary, the economic realities of the publishing industry and the protection of intellectual property rights often stand in the way of this potential. Technology has advanced, but the economics have not evolved to keep pace, resulting in the same exploitative dynamics seen in other industries such as music and comics. To truly create a knowledge society, we must re-examine how intellectual property laws and systems can be adapted to enable access to information and knowledge for all rather than just protecting the profits of a select few.

Author: Malik Datardina, CPA, CA, CISA. Malik works at Auvenir as a GRC Strategist that is working to transform the engagement experience for accounting firms and their clients. The opinions expressed here do not necessarily represent UWCISA, UW, Auvenir (or its affiliates), CPA Canada or anyone else.

The other DDoS: Denial of Service by DMCA

In information security, the common definition of DDoS is Distributed Denial of Service attack. However, there is a legally sanctioned form of DDoS: DMCA Denial of Service, where a user acting in good faith is 'denied service' because of an alleged infringement of the DMCA. The DMCA (i.e. the Digital Millennium Copyright Act) provides a means to enforce of copyright protections online and was ultimately responsible for killing Napster (who enabled peer-to-peer sharing of  music and other files). Although the Napster case was cut & dry to some (like the Recording Industry), there are some where users are actually acting in good faith, but are taken down through enforcement of such  an Act.

The case that illustrates this issue is the take down of 1.45 million education blogs in October. James Framer, CEO of EduBlogs, noted that "ServerBeach, to whom we pay $6,954.37 every month to host Edublogs, turned off our webservers, without notice, less than 12 hours after issuing us with a DMCA email." He went on to explain what the actual infringement was: "one of our teachers, in 2007, had shared a copy of Beck’s Hopelessness Scale with his class, a 20 question list, totalling some 279 words, published in 1974, that Pearson would like you to pay $120 for." Reading the blog further it turns out that EduBlogs did actually comply with the DMCA request that they received. However, the issue that Pearson had was (a) it was accessible via Google's cache and (b) it was accessible by its Varnish cache. In other words, James Farmer got legally DDoSed: 1.45 million blogs were made unavailable due to ServerBeach rush to comply with the DMCA instead of "calling any of the 3 numbers for us [ServerBeach] have on file".

Edublogs, however, is not the only company to be DDoSed in this manner. Small companies that publish news reports on YouTube or other content sharing sites also face this danger. Take for example Leo Laporte's This Week in Tech (TWIT) new media network, which publishes tech related podcasts and videocasts. The business model of this network resides on him being able to make the video available soon after its airing. Failure to do so will result in the company losing out on ad revenue because the "eyeballs never made it" to the particular show. Consequently, when one of their episodes gets pulled down by Google's robots, or due to request of the copyright holder (as noted here), it jeopardizes the TWIT business model making him another DDoS victim.

From a risk perspective, the risk of such event should be evaluated, especially for businesses that rely on revenues via the distribution of online content. Specifically, the agreement with the third parties that host their content should include provisions that enable them to at least demonstrate compliance prior to be taken down. However, both James Farmer and Leo Laporte have attempted to work with their respective providers to prevent this type of risk. Farmer complied with the request, while Laporte has attempted to contact Google and explain that he is news organization. So this is easier said then done. Laporte hosts the videos on his own servers, however the popularity of YouTube limits the effectiveness of this "backup strategy" (i.e. users won't go to the site to watch the video instead of YouTube). In the end, it may just be an unavoidable cost of relying on such providers.

From a longer-term perspective, it illustrates clash of legacy laws and the capability of the Internet to "network knowledge". This the concept is taken from David Weinbergers's "Too big To Know", who identified how the ability to share, link and debate information on the Internet transforms knowledge into a more fluid state in contrast to the static nature of books. He explains this concept in the following video:

James Farmer implicitly argued this point in his rant against Pearson when he said: "Here’s another idea Pearson, maybe one that you could take from Edublogs, howabout you let this tiny useful list be freely available, and then you sell your study materials / textbooks and other material around that… maybe use  Creative Commons Non Commercial Attribution license or similar to make sure you get some links and business." In other words, Pearson has failed to understand this new world of networked knowledge, where a link to the "offending" list would link to other resources that has Pearson has - enriching both Pearson and those using its publications.