How should we hold people responsible when AI causes harm? That's the job of a liability regime.

In this conversation, Jai Ramaswamy, chief legal and policy officer, joins Matt Perault, head of AI policy at a16z, to unpack the role of liability in AI policy: how to protect people from real harms without slowing innovation, limiting competition, or punishing the wrong actors.

They discuss why trust is essential to long-term AI adoption, why liability should focus on harmful uses rather than general-purpose development, and how policymakers can design rules that hold bad actors accountable while giving startups room to build.

The conversation also explores what a workable AI liability regime should prioritize: accountability, proportionality, enforcement of existing laws, and targeted updates where current law falls short.

For founders, policymakers, and anyone tracking the future of AI regulation, this episode offers a guide for thinking about responsibility, risk, and innovation in the AI era.

Topics covered:

00:00: Intro

01:00: Why AI liability is on the table now, and why it's been on Jai's mind for years

02:00: Why this matters — trust, long-term ecosystems, and the equities at stake

04:00: Failure modes at both ends — crushing liability vs. blanket immunity, and why neither serves Little Tech

08:00: The proposals we're concerned about — SB 1047, strict developer liability for downstream misuse, AI as an automatic aggravating factor in criminal law

14:00: The Little Tech lens — focusing on wrongdoing, not building, and why "paperwork favors the powerful"

18:00: The least-cost avoider principle and how it maps onto AI

23:00: Building a better regime — presumption of user liability for AI outputs, procedural safeguards, and well-designed safe harbors

31:00: Protecting good behavior — information sharing, incident reporting, and getting incentives right

32:00: Federal vs. state roles — the constitutional allocation as a guide to liability design

Resources:

Subscribe to the a16z AI Policy Brief: https://a16zpolicy.substack.com/

Follow Matt Perault: https://x.com/MattPerault

Follow Jai Ramaswamy: https://www.linkedin.com/in/jai-ramaswamy-85a77675/

Please note that the content here is for informational purposes only; should NOT be taken as legal, business, tax, or investment advice or be used to evaluate any investment or security; and is not directed at any investors or potential investors in any a16z fund. a16z and its affiliates may maintain investments in the companies discussed. For more details please see a16z.com/disclosures.

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