As the California Legislature’s 2025 session draws to a close, lawmakers have advanced over a dozen AI bills to the final stages of the legislative process, setting the stage for a potential showdown with Governor Gavin Newsom (D).  The AI bills, some of which have already passed both chambers, reflect recent trends in state AI regulation nationwide, including AI consumer protection frameworks, guardrails for the use of AI in employment and healthcare, frontier model safety requirements, and chatbot safeguards. 

AI Consumer Protection.  California lawmakers are advancing several bills that would impose disclosure, testing, documentation, and other governance requirements for AI systems used to make or assist in decisions that impact consumers.  Like 2024’s Colorado AI Act, California’s Automated Decisions Safety Act (AB 1018) would adopt a cross-sector approach, imposing duties and requirements on developers and deployers of “automated decision systems” (“ADS”) used to make or facilitate employment, education, housing, healthcare, or other “consequential decisions” affecting natural persons.  The bill would require ADS developers and deployers to conduct impact assessments and third-party audits and comply with various disclosure and documentation requirements, and would establish consumer notice, correction, and appeal rights. 

Employment and Healthcare.  SB 7 would establish worker notice, access, and correction rights, prohibited uses, and human oversight requirements for employers that use ADS for employment-related decisions.  Other bills would impose similar restrictions on AI used in healthcare contexts.  AB 489, which passed both chambers on September 8, would prohibit representations that indicate that an AI system possesses a healthcare license or can provide professional healthcare advice.

Frontier Model Safety.  Following the 2024 passage—and Governor Newsom’s subsequent veto—of the Safe & Secure Innovation for Frontier AI Models Act (SB 1047), State Senator Scott Wiener (D-San Francisco) has led a renewed push for frontier model safety with his Transparency in Frontier AI Act (SB 53).  SB 53 would require large developers of frontier models to implement and publish a “frontier AI framework” to mitigate potential public safety harms arising from frontier model development, in addition to transparency reports and incident reporting requirements.  Unlike SB 1047, SB 53 would not require developers to implement a “full shutdown” capability for frontier models, conduct third-party audits, or meet a duty of reasonable care to prevent public safety harms.  Moreover, while SB 1047 would have established civil penalties of up to 10 percent of the cost of computing power used to train any developer’s frontier model, SB 53 would establish a uniform penalty of up to $1 million per violation of any of its frontier AI transparency provisions and would only apply to developers with annual revenues above $500 million.  Although its likelihood of passage remains uncertain, SB 53 builds on several recent state efforts to establish frontier model safeguards, including the passage of the Responsible AI Safety & Education (“RAISE”) Act in New York in May and the release of a final report on frontier AI policy by California’s Frontier AI Working Group in June.

Chatbots.  Various other California bills would establish safeguards for individuals, and particularly children, that interact with AI chatbots or generative AI systems.  The Leading Ethical AI Development (“LEAD”) for Kids Act (AB 1064), which passed the Senate on September 10 and could receive a vote in the Assembly as soon as this week, would prohibit individuals or businesses from providing “companion chatbots”—generative AI systems that simulate sustained humanlike relationships through personalization, unprompted questions, and ongoing dialogue with users—to children if the companion chatbot is “foreseeably capable” of engaging in certain activities, including encouraging a child to engage in self-harm, violence, or illegal activity, offering unlicensed mental health therapy to a child, or prioritizing user validation and engagement over child safety, among other prohibited capabilities. Another AI chatbot safety bill, SB 243, passed the Assembly on September 10 and awaits final passage in the Senate.  SB 243 would require companion chatbot operators to issue recurring disclosures to minor users, implement protocols to prevent the generation of content related to suicide or self-harm, and disclose companion chatbot protocols and other information to the state.  

The bills above reflect only some of the AI legislation pending before California lawmakers ahead of their September 12 deadline for passage.  Other AI bills have already passed both chambers and now head to the Governor, including AB 316, which would prohibit AI developers or deployers from asserting that AI “autonomously” caused harm as a legal defense, and California SB 524, which would establish restrictions on the use of AI by law enforcement agencies.  Governor Newsom will have until October 12 to sign or veto these and any other AI bills that reach his desk.

Matthew Shapanka

Matthew Shapanka draws on more than 15 years of experience – including on Capitol Hill, at Covington, and in state government – to advise and counsel clients across a range of industries on significant legislative, regulatory, and enforcement matters. He develops and executes…

Matthew Shapanka draws on more than 15 years of experience – including on Capitol Hill, at Covington, and in state government – to advise and counsel clients across a range of industries on significant legislative, regulatory, and enforcement matters. He develops and executes complex, multifaceted public policy initiatives for clients seeking actions by Congress, state legislatures, and federal and state government agencies, many with significant legal and political opportunities and risks.

Matt rejoined Covington after serving as Chief Counsel for the U.S. Senate Committee on Rules and Administration, where he advised Chairwoman Amy Klobuchar (D-MN) on all legal, policy, and oversight matters within the Committee’s jurisdiction, including federal election law and campaign finance, and oversight of the Federal Election Commission, legislative branch agencies, security and maintenance of the U.S. Capitol Complex, and Senate rules and regulations.

Most significantly, Matt led the Rules Committee staff work on the Electoral Count Reform and Presidential Transition Improvement Act – landmark bipartisan legislation to update the antiquated process of certifying and counting electoral votes in presidential elections that President Biden signed into law in 2022.

As Chief Counsel, Matt was a lead attorney on the joint bipartisan investigation (with the Homeland Security and Governmental Affairs Committee) into the security planning and response to the January 6, 2021 attack on the Capitol. In that role, he oversaw the collection review of documents, led interviews and depositions of key government officials, advised the Chairwoman and Committee members on two high-profile joint hearings, and drafted substantial portions of the Committees’ staff report on the attack. He also led oversight of the Capitol Police, Architect of the Capitol, Senate Sergeant at Arms, and executive branch agencies involved in implementing the Committees’ recommendations, including additional legislation and hearings.

Both in Congress and at the firm, Matt has prepared many corporate and nonprofit executives, academics, government officials, and presidential nominees for testimony at legislative, oversight, or nomination hearings before congressional committees, as well as witnesses appearing at congressional depositions and transcribed interviews. He is also an experienced legislative drafter who has composed dozens of bills introduced in Congress and state legislatures, including several that have been enacted into law across multiple policy areas.

In addition to his policy work, Matt advises and represents clients on the full range of political law compliance and enforcement matters involving federal election, campaign finance, lobbying, and government ethics laws, the Securities and Exchange Commission’s “Pay-to-Play” rule, as well as the election and political laws of states and municipalities across the country.

Before law school, Matt worked as a research analyst in the Massachusetts Recovery & Reinvestment Office, where he worked on all aspects of state-level policy, communications, and compliance for federal stimulus funding awarded to Massachusetts under the American Recovery & Reinvestment Act of 2009. He has also worked for federal, state, and local political candidates in Massachusetts and New Hampshire.

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August Gweon

August Gweon counsels national and multinational companies on data privacy, cybersecurity, antitrust, and technology policy issues, including issues related to artificial intelligence and other emerging technologies. August leverages his experiences in AI and technology policy to help clients understand complex technology developments, risks…

August Gweon counsels national and multinational companies on data privacy, cybersecurity, antitrust, and technology policy issues, including issues related to artificial intelligence and other emerging technologies. August leverages his experiences in AI and technology policy to help clients understand complex technology developments, risks, and policy trends.

August regularly provides advice to clients for complying with federal, state, and global privacy and competition frameworks and AI regulations. He also assists clients in investigating compliance issues, preparing for federal and state privacy regulations like the California Privacy Rights Act, responding to government inquiries and investigations, and engaging in public policy discussions and rulemaking processes.

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