AI Law Center: February/March 2026 Updates

In this month's update:

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AI Regulatory Landscape: Three Things to Know

1. Can your conversations with AI chatbots be discovered in litigation?

Yes. In United States v. Heppner, Judge Rakoff of the Southern District of New York held that a defendant’s communications with an AI chatbot were neither protected by the attorney-client privilege nor the work product doctrine. Read our analysis.

2. How are U.S. state Attorneys General addressing AI-generated deepfakes?

A bipartisan coalition of 35 state attorneys general sent a letter to xAI expressing deep concern that its Grok AI chatbot has been used to produce and facilitate widespread nonconsensual intimate images of real people, including minors. Read our State AG Update.

3. What does the Trump Administration’s national AI legislative framework propose?

The White House issued a comprehensive national legislative framework addressing six key AI policy objectives: protecting children and empowering parents, safeguarding American communities, respecting intellectual property rights, preventing censorship and protecting free speech, enabling innovation to ensure American AI dominance, and educating Americans for an AI-ready workforce. The Administration emphasized its call for federal preemption of conflicting state AI laws. Read the framework.  

New U.S. State AI Laws by AI Scope

Below are the state AI laws that have been newly enacted or substantially updated:

AI CSAM

• Wyoming - Protecting Kids from Deepfakes and Exploitative Images (Wy. Code §§ 6-4-303; 6-4-308)

AI Definition

• Mississippi - Definition of Artificial Intelligence (HB 1723)

AI in Healthcare

• Indiana - Payment of Health Claims (HB1271)

AI Intimate Images

• Wyoming - Wyoming Nonconsensual Synthetic Sexual Material (Wy. Code § 6-4-307)

AI in Government

• Indiana - An Act to Amend the Indiana Code Concerning State Offices and Administration (SB256)

AI Liability

• Wyoming - Wyoming AI Developer Civil Liability (Wy. Code § 1-1-143)
• Wyoming - Wyoming AI Criminal Liability (Wy. Code § 6-1-206)

AI in Political Advertising

• Vermont - An Act Relating to the Use of Synthetic Media in Elections (S23)

User-Facing AI

• Wyoming - Self-Harm Systems (Wy. Code § 6-4-701)

See all enacted state laws >

AI Legal Activity We’re Keeping an Eye On

Illinois Draft Regulations on AI Disclosures in Employment

The Illinois Department of Human Rights is drafting rules implementing amendments to the Illinois Human Rights Act (HB 3773), effective January 1, 2026. According to a summary published by the Illinois State Association of Counties, the draft rules mandate that employers provide clear and conspicuous notice whenever AI is used to facilitate covered employment decisions such as recruitment, hiring, promotion, discipline and discharge. We are monitoring to see what the final disclosure requirements will be.

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