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Abstract: States face a dilemma. The federal government is not regulating artificial intelligence (AI), and is threatening states that regulate the technology with preemption and funding restrictions. Moreover, piecemeal state regulation with different substantive requirements risks impeding AI innovation and harming our national interest and security. And yet, AI creates a whole host of problems relating to accuracy, safety, security, bias, transparency, privacy, and autonomy that needs to be governed. This Article presents a solution to this dilemma that can protect against AI risks without harming innovation and the national interest. The proposal is for states to provide a liability shield for AI systems that conform to recognized comprehensive risk management standards. After discussing the proposed solution, as well as drawbacks to the model, the analysis concludes that these liability shields are a simple, positive step that states can take to both promote AI innovation and protect their citizens from risks.
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