The Supreme Court has entered the AI chat

Happy Thursday! Snow days are great until you really need to get things done. Send tips to: cristiano.lima@washpost.com.

Below: Apple loses a bid to delay a watch ban, and the giant opens up its payment system — with a catch. First:

The Supreme Court has entered the AI chat

While the debate over new potential rules for artificial intelligence is just starting to gain steam in Congress, the Supreme Court this week signaled that it’s already looking ahead to the challenges that regulating the technology may pose for the judicial system.

Justices repeatedly raised the issue during oral arguments Wednesday in Relentless v. Department of Commerce, a major case that could have sweeping implications for how much leeway agencies have to interpret their authority on an array of fronts.

By taking up the dispute, the court is expected to weigh in on the Chevron deference doctrine — the precedent that courts should defer to federal agencies’ interpretations of the laws they oversee as long as they are reasonable and Congress has not directly addressed the matter. If it overturns this standard, a slew of agencies could see their powers significantly diminished.

While the case at hand is unrelated to AI, multiple justices evoked its tools during arguments to highlight the challenge such advanced technologies pose for the courts when interpreting laws.

Justice Elena Kagan said that AI is probably “the next big piece of legislation on the horizon” on Capitol Hill and that due to the technical nature of the technology, Congress is likely to lean on federal agencies to implement any new standards — whether lawmakers spell it out or not.

“There are going to be all kinds of places where, although there’s not an explicit delegation, Congress has in effect left a gap,” she said.

Kagan, who did not mince words last year when describing the court’s lack of internet savvy, suggested that neither Congress nor the courts are fully up to the task of grappling with the technology.

“Congress knows that there are going to be gaps because Congress can hardly see a week in the future with respect to this subject, let alone a year or a decade,” she said. The court, meanwhile, doesn’t “even know what the questions are about AI, let alone the answers.”

Instead, Congress presumably wants “people who actually know about AI” making the decisions about its legal future, she argued — a likely nod to experts housed within agencies.

Justice Brett Kavanaugh also broached the subject, citing AI as an area where many existing laws already “explicitly confer broad policy discretion on agencies.”

The debate is not purely hypothetical.

Top regulators from the Biden administration last year reaffirmed their commitment to using existing legal tools to crack down on potential AI abuses, particularly discriminatory uses. The remarks on Wednesday suggest that the issue could come before the high court more directly sooner rather than later.

The Supreme Court has already dealt blows to agencies’ powers in recent years that could have implications for AI regulation, and the latest Chevron case could have ripple effects for AI as well. “After more than three hours of argument, it was unclear whether the court’s conservative majority would overturn or simply scale back the 40-year-old precedent,” my colleague Ann E. Marimow wrote on Wednesday.

The court is also starting to think about how AI may disrupt its work on a practical level.

Chief Justice John G. Roberts Jr. focused on the issue in his year-end report in December, writing that AI “obviously has great potential to dramatically increase access to key information for lawyers and non-lawyers alike.”

But “just as obviously it risks invading privacy interests and dehumanizing the law,” he wrote, adding that courts should approach their own use of the tools with “caution and humility.”

Our top tabs

Apple loses bid to delay U.S. watch ban

Apple lost an attempt to delay a U.S. import ban of its smartwatches from going into effect as the company appeals the ruling, the Wall Street Journal’s Aaron Tilley reports.

“Watch sales are expected to continue for the iPhone maker, but the company earlier revealed plans to disable blood-oxygen measurement technology in some models of the device to avoid the ban,” according to the report.

A federal appeals court lifted an interim stay against the implementation of an October ruling by the U.S. International Trade Commission, finding that the tech giant violated a competitor’s patents. The order is now set to go back into effect Thursday.

“Apple’s appeal process is expected to take more than a year, an Apple spokeswoman said earlier,” according to the report.

Apple says app makers can use outside payment systems — if they pony up

Apple is opening up its iPhone walled garden just enough to let U.S. app makers use outside payment systems — but with a steep price, my colleague Eva Dou reports.

The company announced the news in a legal filing Tuesday to comply with a court order following a lawsuit by Epic Games over Apple’s restrictions on app makers. “After the Supreme Court declined to review the case this week, Apple moved to implement a lower court’s 2021 decision, which had been suspended pending appeal,” she writes.

“Previously Apple required developers to use its in-house system to accept payments, charging hefty fees of up to 30 percent,” she adds. “But Apple still intends to take a 27 percent cut for the link-out to external payment systems, and declared a right to audit developers’ accounts to verify they are paying up.”

App developers have reacted furiously, with Epic Games CEO Tim Sweeney calling it “a bad-faith ‘compliance’ plan” in a post on X and warning that Epic will contest the move in court.

“Apple has never done this before, and it kills price competition,” he wrote. “Developers can’t offer digital items more cheaply on the web after paying a third-party payment processor 3-6% and paying this new 27% Apple tax.”

Apple poised to face U.S. antitrust suit as early as March

Apple is expected to face an antitrust suit from the Justice Department as early as March, Bloomberg’s Leah Nylen reports.

“Antitrust enforcers allege that Apple has imposed software and hardware limitations on its iPhones and iPads to impede rivals from effectively competing, echoing concerns raised by Spotify Technology SA, bluetooth tracker Life360 Inc.’s Tile and messaging service Beeper,” according to the report. The Justice Department and Apple have “met three times to discuss a potential suit,” the report added.

The New York Times reported earlier this month that the Justice Department “is in the late stages of an investigation into Apple and could file a sweeping antitrust case taking aim at the company’s strategies to protect the dominance of the iPhone as soon as the first half of this year.” The report said the department began a series of investigations into the tech giants in 2019 but “prioritized its antitrust review of Google over Apple because it lacked the financial resources and personnel to fully evaluate both companies.”

Mentions

Georgetown University and the Knight Foundation appointed Alissa Cooper, formerly a Cisco vice president, as the inaugural executive director of the Knight-Georgetown Institute.
Olivier Sylvain, a former senior adviser at the Federal Trade Commission and Fordham law professor, is joining the Knight First Amendment Institute as a senior policy research fellow.

Daybook

The National Fair Housing Alliance holds an event, “Responsible AI Symposium: Advancing a Blueprint for Tech Equity,” today and Friday from 9 a.m. to 1:45 p.m.
The American Action Forum hosts an event, “Assessing Today’s FTC,” today at 1 p.m.

Before you log off

That’s all for today — thank you so much for joining us! Make sure to tell others to subscribe to The Technology202 here. Get in touch with tips, feedback or greetings on X or email.

ncG1vNJzZmivp6x7uK3SoaCnn6Sku7G70q1lnKedZL2wuMitoJyrX2d9c4COaWhoaWhkwLa80Z6knmWTpMKzwIyhmKxllaPBpr7EnWSaoV2YtaLAjg%3D%3D

Chauncey Koziol

Update: 2024-08-16

JiveBlog