Safeguarding Proprietary Fund Data and Intellectual Property When Using Generative AI (Part Two of Two)

Generative artificial intelligence (GenAI) continues to chart new territories at an exhilarating pace. As private funds venture into the realm of GenAI, they are confronted with a pivotal decision: how to grant access to their confidential information and intellectual property (IP) while maintaining appropriate protection. The art lies in striking a harmonious balance between fortifying proprietary data and unlocking the potential of GenAI. Not all GenAI undertakings call for jeopardizing valuable information; the range of necessary inputs depends on the task, purpose and desired output. This second article in a two‑part guest series by Akin attorneys Michael P. Kahn and Ryan Dowell explores the challenges and considerations private funds face when integrating GenAI into their operations, focusing on safeguarding proprietary fund data and IP. It provides insights into the risks associated with using GenAI, different potential forms of GenAI deployment and best practices to protect sensitive information. The first article highlighted the evolving regulatory landscape concerning GenAI and the customization of GenAI models and their potential applications to private funds. See “Designing a State-of-the-Art Private Fund Compliance Department: Leveraging Cutting-Edge Technology” (Sep. 21, 2023).

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