According to reports published on November 19, the White House has prepared a draft Executive Order to preempt state AI regulations in lieu of a uniform national legislative framework, marking a significant escalation in federal efforts to assert control over AI regulation.  The draft Executive Order, titled “Eliminating State Law Obstruction of National AI Policy” (and marked “Deliberative/Predecisional/Draft”) (“draft EO”), outlines a sweeping, multi-pronged effort to “sustain and enhance America’s global AI dominance through a minimally burdensome, uniform national policy framework for AI.”  

The draft EO directs White House officials and federal agencies to take various steps to preempt or challenge certain state AI regulations deemed unconstitutional or inconsistent with federal law, or to withhold federal funding from states with AI laws deemed inconsistent with the policies described in the draft EO, including:

  • Establishing an AI Litigation Task Force.  The draft EO directs the Attorney General to establish an “AI Litigation Task Force” with the “sole responsibility” of challenging state AI laws that, “in the Attorney General’s judgment,” unconstitutionally regulate interstate commerce, conflict with existing federal regulations, or otherwise violate federal law.
  • Evaluating “Onerous State AI Laws.” The draft EO directs the Commerce Secretary, in consultation with White House officials, to publish an evaluation of state AI laws that conflict with the draft EO or that should be referred to the AI Litigation Task Force.  Echoing President Trump’s July 23 Executive Order on “Preventing Woke AI in the Federal Government,” the draft EO requires this evaluation to identify state AI laws that “require AI models to alter truthful outputs” or require disclosures from AI developers or deployers that would violate First Amendment or other constitutional rights.
  • Funding Restrictions for States with AI Laws.  Mirroring provisions in the proposed state and local AI moratorium that was overwhelmingly rejected by the Senate in July, the draft EO directs the Commerce Secretary to withhold certain Broadband Equity Access and Deployment (“BEAD”) funds from states with “onerous” AI laws identified by the Secretary above. The draft EO also directs federal agencies to assess whether to require states to refrain from enacting or enforcing certain AI laws as a condition for receiving certain discretionary grants.
  • Agency Preemption of State AI Laws.  Consistent with recommendations in President Trump’s July 23 AI Action Plan, the draft EO directs the Federal Communications Commission (FCC) to consider adopting a “Federal reporting and disclosure standard for AI models that preempts conflicting State [AI] laws.”  The draft EO instructs the Federal Trade Commission (FTC), in consultation with the White House Special Advisor for AI and Crypto, to “issue a policy statement on the application of the FTC Act’s prohibition on unfair and deceptive acts or practices under 15 U.S.C. 45 [Section 5 of the FTC Act] to AI models.”  The draft also directs the FTC to specifically “explain the circumstances under which State laws that require alterations to the truthful outputs of AI models” are preempted by Section 5’s prohibition on deceptive acts or practices.
  • Legislative Recommendations for Federal AI Framework.  The draft EO directs the White House Special Advisor for AI and Crypto and the Office of Legislative Affairs to “jointly prepare . . . a legislative recommendation establishing a uniform Federal regulatory framework for AI that preempts state AI laws that conflict with the policy set forth” in the draft EO.

Although the operative provisions of the draft EO do not expressly target any particular state AI laws, the statement of purpose specifically references the Colorado AI Act, which establishes reporting, impact assessment, and transparency requirements for developers and deployers of certain “high-risk AI systems,” as well as California’s recently enacted Transparency in Frontier AI Models Act, which imposes transparency, reporting, and whistleblower requirements for developers of “frontier models” deemed to pose “catastrophic risks” to public safety.  While these laws are noted as motivating factors for the draft EO, agency actions taken pursuant to the draft EO would presumably apply to state laws deemed to conflict with the policies adopted in the draft.

The draft EO follows a series of recent efforts to curb state AI laws and, if ultimately finalized, could reshape the balance of federal and state authority over AI regulation.  On July 1, the Senate, by a 99–1 vote, rejected a proposed amendment to the budget reconciliation bill, the One Big Beautiful Bill Act, that would have imposed a moratorium on state and local AI enforcement.  Later in July, the White House released its AI Action Plan, which called on federal agencies to limit funding to states with “burdensome” AI laws and urged the FCC to evaluate potential preemption under the Communications Act.  And in recent weeks, and with support from the President, House Republicans have renewed efforts for federal legislation to preempt state AI laws, pushing to include an AI preemption provision in the Fiscal Year 2026 National Defense Authorization Act (NDAA). 

While it remains uncertain whether President Trump will ultimately issue the draft EO as prepared or whether the latest legislative efforts to preempt state AI legislation will succeed, the debate over the proper scope of AI regulation—and the role of federal and state governments in adopting and enforcing those regulations—will persist. 

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For more updates on developments related to artificial intelligence and technology, see our Inside Global Tech, Global Policy Watch, and Inside Privacy blogs.

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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