Silicon Valley Tech News Roundup – December 10th
EU reaches a provisional deal on landmark AI regulation – 12/8
On Friday, the EU member states reached a provisional deal on what will be a landmark AI regulation. AI Act is labeled as the world’s first law that will regulate the use of AI.
The European Parliament will vote on the AI Act next year. However, the regulation will not come into effect until at least 2025. The negotiated proposals include safeguards on the use of AI, outline fines for potential violations, and ensure consumers have the right to launch complaints. Likewise, it divides AI into risk categories (from unacceptable to low-, medium-, and high-risk).
Thierry Breton (the EU Commissioner) called the deal “historic” and one that sets “clear rules for the use of AI.” Further, he added the new regulation was “much more than a rulebook – it’s a launch pad for EU start-ups and researchers to lead the global AI race.”
Ursula von der Leyen (European Commission President) stated the regulation will help develop technology that does not threaten people’s rights and safety.
The FTC to investigate Microsoft’s OpenAI investment – 12/8
According to a report by Bloomberg on Friday, the Federal Trade Commission (FTC) is looking into Microsoft’s $13 billion investment into OpenAI. The regulator wants to establish whether the investment violates antitrust laws. Likewise, The Competition and Markets Authority (the UK’s competition regulator) is doing the same.
Bloomberg reports the investigation is still in preliminary stage and not formal. The FTC faces two challenges and is limited in what it can do. OpenAI is a non-profit. According to the law, transactions that involve non-corporate entities do not have to be reported. Furthermore, according to the law, the $13 billion Microsoft investment in OpenAI does not give Microsoft control technically.
Meanwhile, The Competition and Markets Authority in the United Kingdom is investigating whether the partnership between Microsoft and OpenAI resulted in an “acquisition of control” and if the companies merged. If so, the Competition and Markets Authority is investigating if it could affect competition in the United Kingdom. Microsoft denied reports it owns a stake in OpenAI. However, it is entitled to a share of the profits.
Changpeng Zhao cannot leave the U. S. until his criminal sentencing – 12/8
On Thursday, a U. S. District Judge in Seattle, Washington, ruled that Changpeng Zhao (the founder of Binance) cannot leave the United States until his criminal sentencing scheduled for February 2024.
The U. S. District Judge Richard Jones explained his ruling: “The defendant has enormous wealth and property abroad, and no ties to the United States. His family resides in the UAE and it appears that he has favored status in the UAE… Under these circumstances the Court finds that the defendant has not established by clear and convincing evidence that he is not likely to flee if he returns to the UAE.”
The court released Changpeng Zhao on a $175 million bond, and the judge allowed Zhao to visit family in the United Arab Emirates. However, the prosecutors asked the court to reverse the decision since they argued there was “no combination of conditions” that would ensure Zhao would return to the United States. Furthermore, Zhao’s bond is tied to assets outside of the country and out of U. S. jurisdiction.
23andMe changed terms of service to prevent hacked customers from suing – 12/8
23andMe (the genetic testing company) changed its terms of service to prevent its customers from participating in a jury trial or filing a class action lawsuit after reports revealed hackers accessed the company’s database. According to the reports, the hackers accessed the personal information of over half of the company’s user base in October.
In October, Anne Wojcicki (the CEO of 23andMe) revealed the hackers accessed sensitive information like names, locations, photos, and names of related family members. However, the company claimed hackers did not access DNA records or genetic material. It was unclear how many customers the hack impacted. Days after, the hackers put up profiles of thousands of Chinese people and Ashkenazi Jews for sale on the Internet.
Earlier this week, the company sent an email to its customers announcing it made changes to the Dispute Resolution and Arbitration section of Terms “to include procedures that will encourage a prompt resolution of any disputes and to streamline arbitration proceedings where multiple similar claims are filed.” The updated version of the terms of service does not allow customers to file class action suits. Furthermore, the company will automatically opt customers into the new terms. Customers can only opt out if they inform the company they disagree in writing within 30 days of receiving the notice.
The company’s filing with the Securities and Exchange Commission revealed customers filed several class action suits in California, Illinois, and Canadian courts.
