AI Regulatory Violations to Bring an Increase in Legal Disputes

By 2028, AI regulatory violations will result in a 30% increase in legal disputes for tech companies, according to Gartner. A survey of 360 IT leaders involved in the rollout of GenAI tools found that over 70% indicated that regulatory compliance is within their top three challenges for their organization’s widespread GenAI productivity assistants deployment. Only 23% of respondents are very confident in their organization’s ability to manage security and governance components when rolling out GenAI tools in their enterprise applications.

“Global AI regulations vary widely, reflecting each country’s assessment of its appropriate alignment of AI leadership, innovation, and agility with risk mitigation priorities,” said Lydia Clougherty Jones, Senior Director Analyst at Gartner. “This leads to inconsistent and often incoherent compliance obligations, complicating alignment of AI investment with demonstrable and repeatable enterprise value and possibly opening enterprises up to other liabilities.”

At the same time, the impact of the geopolitical climate is steadily growing, but the ability to respond lags. Fifty-seven percent of non-U.S. IT leaders from the same survey indicated that the geopolitical climate at least moderately impacted GenAI strategy and deployment, with 19% of respondents reporting it has a significant impact. Yet, nearly 60% of those respondents reported that they were unable or unwilling to adopt non-U.S. GenAI tool alternatives.

In a Gartner September 3, 2025 webinar poll, 40% of the 489 respondents indicated that their organization's sentiment to AI sovereignty - defined as the ability of nation-states to control the development, deployment, and governance of AI technologies within their jurisdictions - is “positive” (as in viewed with hope and opportunity), and 36% indicated their organization’s sentiment was “neutral” (as in taking a “wait and see” approach). In the same poll, 66% of the respondents indicated they were proactive and/or engaged in response to sovereign AI strategy, and 52% indicated that their organization was making strategic or operating model changes as a direct result of sovereign AI.

With GenAI tools, such as GenAI productivity assistants, becoming more ubiquitous in uncertain and fluctuating geopolitical and legal environments, especially with AI sovereignty in mind, IT leaders must immediately strengthen the moderation of outputs by taking the following steps:

• Engineer self-correction by training models to self-correct and not answer certain questions in real time, communicating instead a phrase such as “beyond the scope.”
• Create rigorous use-case review procedures that evaluate the risk of “chatbot output to undesired human action,” from legal, ethical, safety, and user impact perspectives; use control testing around AI-generated speech, measuring performance against the organization’s established risk tolerance.
• Increase model testing/sandboxing by building a cross-disciplinary fusion team of decision engineers, data scientists, and legal counsel to design pre-testing protocols and test and validate the model output against unwanted conversational output. Document the efforts of this team to mitigate unwanted terms in model training data and unwanted themes in the model output.
• Inject content moderation techniques such as “report abuse buttons” and “AI warning labels.”