On December 11, President Donald Trump signed an executive order (EO) that establishes a national artificial intelligence (AI) regulatory framework and attempts to preempt enforcement of state AI laws. Titled “Ensuring a National Policy Framework for Artificial Intelligence,” the EO states that “[i]t is the policy of the United States to sustain and enhance the United States’ global AI dominance through a minimally burdensome national policy framework for AI.” This latest effort follows bipartisan opposition in Congress and among state attorneys general (AGs) to previous legislative attempts this year to supersede state AI laws. While the order seeks to minimize a burdensome AI regulatory patchwork, compliance will remain complex given various state enforcement tools.

In accordance with the EO, the White House will prepare a recommendation to Congress to establish a “uniform Federal policy framework for AI that preempts State AI laws that conflict with the policy set forth in this order.” However, state AI laws relating to child safety protections, data center infrastructure (excluding generally applicable permitting reforms), state government AI procurement and use, and other topics “to be determined,” will not be preempted by the legislative recommendation.

Further, in January, the AG will establish an AI Litigation Task Force with the sole purpose of challenging state AI laws pursuant to the Commerce Clause and Supremacy Clause deemed to be inconsistent with the policy of the U.S. “to sustain and enhance the United States’ global AI dominance.” The secretary of commerce will publish an evaluation of existing state AI legislation by March to identify onerous laws conflicting with the policy, and will refer such laws to the AI Litigation Task Force. The secretary will also deem states with burdensome AI laws ineligible for Broadband Equity, Access, and Deployment (BEAD) funds.

The Federal Communications Commission (FCC) chair is also tasked with initiating a proceeding to determine whether to adopt a federal reporting and disclosure standard for AI models that will preempt existing state laws. The FCC must issue a policy statement applying the Federal Trade Commission (FTC) Act’s prohibition on unfair and deceptive acts or practices to AI models, specifically clarifying that state laws that require the alteration of outputs to comport with pre-determined values or ranges are preempted by the act’s prohibition on deceptive practices.

This development follows two other congressional legislative attempts to curtail state AI enforcement this year. In early 2025, the Trump administration introduced its “Big Beautiful Bill” that, among other things, imposed a 10-year moratorium on state laws that limit, restrict, or regulate AI systems. In response, a bipartisan coalition of 40 AGs sent a letter to Congress expressing strong opposition and arguing the provision violates state sovereignty and impedes their consumer protection duties. Congressional leaders ultimately removed the provision in the wake of additional congressional bipartisan opposition. Congress attempted to insert a similar provision in the National Defense Authorization Act of 2026, which was also ultimately stricken in the face of bipartisan opposition.

State AGs are similarly expected to oppose and challenge the EO. While only four states, California, Colorado, Texas, and Utah, have passed AI-specific governance legislation, state AGs are using myriad tools and tactics to address perceived deficiencies in the AI regulatory scheme, advance public safety, and impose guardrails. Over the past two years, several state AGs, including Oregon, Massachusetts, New Jersey, and New York, have warned that they will enforce consumer protection, privacy, anti-discrimination, and housing laws related to the development and deployment of AI solutions. By way of example, the Massachusetts AG announced a $2.5 million settlement in July with a Delaware‑based student loan company to resolve allegations that the company’s lending practices — including the use of AI models — violated consumer protection and fair lending laws. In another example, the Pennsylvania arm of a Las Vegas‑based rental management company paid the state of Pennsylvania to settle allegations that its AI platform contributed to delays in repairs and rentals of unsafe housing last May.

In November, North Carolina AG Jeff Jackson and Utah AG Derek Brown, along with the Attorney General Alliance, announced a task force with generative‑AI developers — including OpenAI and Microsoft — to identify and develop consumer safeguards within AI systems as these technologies proliferate. The task force creates a mechanism for state AGs to work with technology companies, law enforcement, and AI experts to better insulate the public from AI risks as new systems come online, with a particular focus on child safety.

On December 9, the National Association of Attorneys General sent a bipartisan letter co-signed by 42 state AGs to several AI industry leaders expressing concern for “sycophantic and delusional” AI outputs. AI is “sycophantic” when it single-mindedly pursues human approval, and “delusional” when it provides an output that is either false or likely to mislead the user. The letter also highlighted reports of disturbing and dangerous AI interactions with children, including the suicides of two teenagers this year after interactions with AI chatbots. The AGs listed additional safeguards developers should implement to mitigate such risks.

Why It Matters

The Trump administration’s efforts to minimize the regulatory burden associated with the development, adoption, and deployment of AI solutions will increase the speed of development of AI innovation and growth. But minimal federal regulatory oversight does not mean that developers and deployers can ignore their obligations under other existing laws. In other words, it does not matter whether a company uses AI when engaging in conduct that is otherwise illegal under existing consumer protection laws. AI developers and deployers ignore AI agnostic laws in every state at their own peril.

Organizations utilizing AI must therefore generally ensure that they have implemented and documented important consumer safeguards, such as risk impact assessments and risk management systems for example, and that they can effectively accommodate data-subject requests, among many other considerations. Engaging relevant internal stakeholders and consulting experienced outside counsel will help navigate these opportunities and minimize regulatory exposure within an ever-changing AI landscape.

Troutman Pepper Locke State Attorneys General Team

	Ashley Taylor – Co-leader and Firm Vice Chair Ashley is co-leader of the firm’s nationally ranked State Attorneys General practice, vice chair of the firm, and a partner in its Regulatory Investigations, Strategy + Enforcement (RISE) Practice Group. He helps his clients navigate the complexities involved with multistate attorneys general investigations and enforcement actions, federal agency actions, and accompanying litigation.
	Clay Friedman – Co-leader Clay co-leads the firm’s State Attorneys General practice and is nationally ranked by Chambers USA for AG Government Relations and in Best Lawyers for Advertising Law. He has dedicated his entire career to state attorney general and federal work, serving for nearly a decade in a senior role and more than 25+ years in private practice. Clay focuses his practice on helping industry-leading companies mitigate the risks associated with state and federal regulatory investigations and associated litigation.
	Chris Carlson Chris advises clients on regulatory, civil, and criminal investigations and litigation. With a background as an assistant attorney general, he provides practical guidance to clients with matters involving state attorneys general and federal regulatory agencies.
	Lauren Fincher Lauren has vast experience handling state attorneys general investigations, navigating complex regulatory compliance matters, and providing strategic counsel in enforcement actions across various industries. She helps clients manage high-stakes regulatory matters and guides them through complex legal landscapes.
	Stephen Piepgrass Stephen leads the firm’s Regulatory Investigations, Strategy + Enforcement (RISE) Practice Group, representing clients in single and multistate enforcement actions, including inquiries and investigations, as well as litigation involving state attorneys general and other state and federal governmental enforcement bodies. He has significant experience handling actions with federal agencies, including the CFPB and FTC, as well as single plaintiff and class action litigation for clients in highly regulated sectors such as financial services, health care, pharmaceutical, and education.
	Michael Yaghi Mike handles high-profile state attorneys general, FTC, and CFPB investigations by advising clients through these complex government inquiries. He assists clients through the entire life cycle of investigations, from regulatory enforcement through formal litigation.
	Matthew J. Berns Drawing on his experience in senior leadership roles in the New Jersey Attorney General’s and Governor’s Offices and as a trial attorney for the U.S. Department of Justice, Matt provides an insider’s perspective when guiding clients through complex government investigations, litigation, and other actions.
	Samuel E. “Gene” Fishel Gene is a former regulator with two decades of experience who has overseen state privacy and cybersecurity regulation enforcement, led national, multistate attorneys general privacy investigations, and prosecuted computer crimes at the state and federal levels. He has served at the forefront of state attorney general and federal enforcement, and utilizes this experience to proficiently represent client interests.
	Jeff Johnson Jeff helps clients navigate complex regulatory and litigation challenges with local, state, and federal authorities. His clients benefit from his decade of broad litigation experience, understanding of emerging state and federal regulatory issues, and strong relationships with attorneys general across the U.S. In addition to handling cases from trial through state or federal appeals, Jeff serves as amicus counsel in advancing legal rules to support his clients’ vital interests.
	Jay Myers Jay assists clients in heavily regulated industries, including health care, energy, insurance, emerging industries, and data privacy. He provides both regulatory legal advice and government relations strategies. Jay’s past and current clients include Fortune 10 companies, startups, nonprofits, industry associations, and advocacy groups. Recognizing that state government matters are often complex and multifaceted, he utilizes regulatory guidance, government advocacy, or both in tandem to deliver tailored solutions for each client’s unique needs.
	Zoe Schloss Zoe represents clients in litigation and government investigations. As former deputy attorney general for the Delaware Department of Justice, she is an experienced litigator who understands the enforcement priorities that impact her clients. Zoe works with individuals and corporate entities in highly regulated industries, including financial services, health care, and energy.
	Jessica Birdsong Jessica is an associate in the firm’s Regulatory Investigations, Strategy + Enforcement Practice Group. She received her J.D. from the University of Richmond School of Law, magna cum laude, where she served as associate articles editor of the Journal of Law & Technology.
	Blake R. Christopher Blake collaborates with clients on matters related to government contracting, investigations, and disputes. His senior-level government experience generates valuable insights and strategies for clients across a variety of industries.
	Nick Gouverneur Nick is an associate in the firm’s Regulatory Investigations, Strategy + Enforcement Practice Group. He received his J.D. from the University of Illinois College of Law, where he served as a member of the Journal of Law, Technology & Policy.
	Troy Homesley Troy is an accomplished litigator who has represented and defended clients across a wide range of complex, high-stakes disputes at both the trial and appellate levels. He has represented technology companies, business executives, law firms, investment funds, high-ranking federal officials, international non-profits, and asylum seekers. Troy draws on his broad litigation experience to advise clients before litigation arises, while claims are pending or threatened, and leading up to and through trial and appeals.
	Namrata Kang Namrata (Nam) is an associate in the firm’s Regulatory Investigations, Strategy + Enforcement (RISE) Practice Group, based in the Washington, D.C. office. She routinely advises clients on a wide variety of state and federal regulatory matters, with a particular emphasis on state consumer protection laws relating to consumer financial services and marketing and advertising. Nam’s experience transcends multiple industries, including financial services, telecommunications, media, and sports betting.
	Michael Lafleur Michael is an associate in the firm’s Regulatory Investigations, Strategy, and Enforcement Practice Group. Based out of the firm’s Boston office, Mike has deep experience in litigation, investigations, and other regulatory matters involving state-level regulators and state attorneys general.
	Philip Nickerson Philip represents clients in sectors such as financial, tech, real estate, and energy in a range of litigation matters. He is experienced in matters involving trade secrets, government investigations, commercial contracts, construction and product defect.
	Lane Page Lane specializes in federal and state regulatory investigations and complex civil litigation. He focuses on representing financial institutions and other businesses, with a particular emphasis on consumer protection and fair lending issues.
	Dascher Pasco Dascher is an attorney within the Regulatory Investigations, Strategy, and Enforcement practice, based in the Richmond office. She joined our firm after working in personal injury and medical malpractice for a Virginia trial law firm. Dascher brings varied legal experience to the firm with strong litigation and regulatory strategy capabilities.
	Kyara Rivera Rivera Kyara is an associate in the firm’s Regulatory Investigations, Strategy + Enforcement Practice Group. She received her J.D. from the University of Richmond School of Law, cum laude, where she served as publications and online editor of the Public Interest Law Review.
	Timothy Shyu Timothy is an associate in the firm’s Regulatory Investigations, Strategy + Enforcement Practice Group.
	Trey Smith Trey focuses his practice on representing and advising regulated utilities before state public utility commissions. He routinely helps clients obtain certificates of public convenience and necessity for transmission infrastructure. In this role, Trey works with his clients’ subject-matter experts to manage administrative proceedings, including by preparing initial filings; responding to discovery requests; drafting rebuttal testimony; and litigating any disputed issues.
	Daniel Waltz Dan helps clients navigate all aspects highly regulated relationships between industry participants and federal, state and local governments. Whether engaging with regulators, negotiating transactions or representing clients in the courtroom, he delivers solutions that help his clients achieve their strategic goals.
	Cole White Cole is a member of the firm’s Regulatory Investigations, Strategy and Enforcement (RISE) group. He has a decade of experience working in the attorney general community, having joined the firm from the Wyoming Office of the Attorney General, where he was assistant attorney general.
	Zoe Schloss Zoe represents clients in litigation and government investigations. As former deputy attorney general for the Delaware Department of Justice, she is an experienced litigator who understands the enforcement priorities that impact her clients. Zoe works with individuals and corporate entities in highly regulated industries, including financial services, health care, and energy.
	Stephanie Kozol Stephanie is Troutman Pepper Locke’s senior government relations manager in the state attorneys general department.