Akerman Litigation Practice Group Partners Donnie M. King and Eric D. Coleman and Associate Reginald Janvier authored “Operational AI‑Washing: The Plaintiffs’ Bar’s New Playbook for Rule 10b‑5 Litigation,” the opening installment of a five‑part Law360 series examining AI‑driven securities and governance risk.
In the article, Donnie, Eric, and Reginald identify an emerging litigation risk that has not yet produced a dispositive court ruling and coin it as “operational AI‑washing.” The concept arises when companies invoke artificial intelligence to explain internal business decisions, particularly workforce reductions or restructurings, in ways that may obscure underlying financial distress.
They caution that once a company cites AI as the driver of such decisions, the half‑truth doctrine can place the full rationale at issue, potentially exposing the company to liability under Rule 10b‑5.
Donnie, Eric, and Reginald outline the red flags plaintiffs will use to build these cases. They conclude with concrete steps companies can take to reduce exposure ahead of the 2026 restructuring cycle, including ensuring board-level communications are consistent with public statements and maintaining contemporaneous documentation to support every AI-related claim.
A new installment in the series will be published each Tuesday through June 9, 2026.