New California Disclosure Requirement for “Synthetic Performers” in Advertising is Sure to Lead to Wave of Lawsuits

On September 16, California Governor Gavin Newsom signed SB 1050 into law, establishing transparency requirements concerning the use of AI-generated figures and voices in advertisements. This development comes just months after a similar law took effect in New York. But unlike New York’s law, the California law contains a private right of action. SB 1050 becomes enforceable on January 1, 2027.

When Does SB 1050 Apply?

SB 1050 makes it unlawful to create and cause to be published an advertisement that “prominently includes a synthetic performer without a clear and conspicuous disclosure[.]” It applies broadly across different mediums of advertisements, and to companies of all different sizes and sectors.

• Advertisements are defined broadly as “any audio, video, or audiovisual message, statement, statement, audiovisual recording, digital communication, or other representation…intended to induce, or that is reasonably expected to induce, the purchase of goods or services[.]”
• A “synthetic performer” is any representation created “in whole or in part using generative [AI] that creates the realistic impression of the audio, audiovisual, or visual performance of a human performer who is not recognizable as any identifiable natural person.”
• A synthetic performer is prominently included whenever they demonstrate or illustrate the product or service in the foreground of an advertisement, provide or voice the narration or commercial message either on- or off-camera, or illustrate or react to the narration or commercial message.
• The required disclosure must be “difficult to miss, easily understandable, and presented in a manner that a reasonable consumer would notice, read, and comprehend[.]” The wording should be substantially similar to “this performance features a synthetic performer” or “no human performer is depicted.”

The gray areas in the law are certain to be the subject of litigation. Advertisements featuring fully AI-generated figures or voiceovers are at the highest risk of violating SB1050 unless they are accompanied by a clear and conspicuous disclosure. By contrast, if promotional materials feature a real performer and AI is used only for slight enhancements—such as basic editing or retouching—the risk of noncompliance is low. The closer-calls, which almost certainly will result in litigation, are those instances where AI enhancements or edits create a question as to whether the original individual is still “recognizable” as an “identifiable natural person.” For instance, a circumstance where AI is used to augment a known actor’s voice or movement to the point where he may no longer be recognizable as a “natural person,” could be ripe for plaintiffs’ attorneys to send a demand letter.

What are the Exceptions?

The California law includes certain notable exceptions. For instance, SB 1050 will not apply to advertisements for expressive works such as movies, TV shows, videogames, and more, as long as the use of the synthetic performer in the advertisement is consistent with its use in the expressive work. It also does not apply when generative AI is used solely for language translation or other accessibility features.

Is There a Private Right of Action?

A violation of the new law will constitute a violation of California’s False Advertising Law (Bus. &. Prof. Code § 17500), enforceable pursuant to the state’s Unfair Competition Law (Bus. & Prof. Code § 17200 et seq.). Actions for injunctions may be brought by the Attorney General, an authorized district attorney or county counsel, or in certain cases, a city attorney or prosecutor. This framework also includes a private right of action for plaintiffs who have suffered injury and lost money or property due to the prohibited conduct.

How Does SB 1050 Differ From New York’s GBL § 396-b?

Although both New York and California have recently passed legislation, there are several key differences between the two laws:

• New York’s definition of “synthetic performer” is broader than California’s, as it includes performers created or modified using software algorithms as well as with generative AI.
• California’s law applies to audio advertisements, which are expressly exempted under New York’s law.
• California only requires a disclosure when a synthetic performer is prominently featured, while New York requires a disclosure whenever an advertisement includes a synthetic performer.
• Liability under New York’s law requires actual knowledge of the inclusion of a synthetic performer; there is no such knowledge qualifier under SB 1050.
• There is no private right of action in New York.

What are the Next Steps?

Companies advertising in California should carefully review the new law to ensure that their materials are compliant and consider adding disclosures where necessary.

Vorys continues to monitor developments under the new California law and other laws regulating the application and use of AI.

By: John Landolfi, Chris Ingram and Chris LaRocco