Sharon Klein

Irvine
When Sharon Klein started working on early AI transactions, she said it was key to watch product demos and discuss with clients how best to use the AI systems in workflow.
"Understanding the use of data to achieve desired results, and the privacy and security implications, has always been at the core of my compliance, transactional and regulatory practice," she said. "AI is a natural extension of my practice."
Klein added: "Data science and AI has been used for decades in the healthcare industry, including to prioritize workflows to allow clinicians to maximize their productivity and assist with diagnosis. I closed many of these early AI deals. The incredible value of AI is precariously balanced with the potential for abuse and misuse of data, making it a fascinating and rapidly evolving area of law."
One of her notable contributions was advising a cleaning robot company on global AI privacy issues. The robots, designed to clean stores while capturing photographic data, posed unique legal challenges. Klein's work was pivotal in differentiating her client in the market through legal compliance with AI regulations.
"The outcome was a white paper which we developed with the client articulating what data the robot collects, how the data is used, what protections are in place and how the company strives to comply with all applicable AI laws," she said.
Klein's proficiency also shines through in the health care sector, where she has negotiated multiple AI contracts aimed at enhancing clinician productivity. Her work has directly impacted patient care, particularly in prioritizing mammogram x-rays to identify potential Stage 4 cancer cases.
"Presently, there is little question about moving forward with AI tools, but many questions about processes and governance of the use of AI and the allocation of risk as laws surrounding AI rapidly evolve," she said.
Klein noted the biggest challenge has been predicting how AI legislation will be implemented given that the legal framework is significantly behind the technology.
"Our advice is needed to cover and coalesce divergent streams of proposed AI laws in an ever-shifting landscape," she said. "My extensive experience appearing before federal and state regulators informed my predictions of the regulatory outcomes."
As for the future of AI, Klein said just as U.S. privacy laws followed Europe's GDPR, the U.S. will be following the lead of Europe in applying the EU AI Act, which is a risk-adjusted framework in which to analyze AI.
"There will be more intense regulatory scrutiny for developers of AI systems than users of AI systems," she said. "However, companies must focus on analyzing and documenting why an AI tool should be used given the accompanying risks and how such risks are mitigated (i.e., all output is reviewed by humans). The lawsuits will be grounded on privacy and security noncompliance; IP issues, especially in copyrights; and regulatory issues based on violation of the new crop of AI laws, especially those involving algorithmic discrimination in employment."