BLIP Clinic Explores Law in the Age of AI

Among the more intriguing and beguiling projects this semester, BLIP has considered concepts surrounding artificial personhood and the legal feasibility of creating and representing an autonomous AI. As Professor Jonathan Askin, BLIP’s director, has noted in his scholarship leading into this past semester, BLIP asks the following: If persons can be persons, if persons can be corporations, if corporations can be persons, if data can be corporations, could data be persons, at least as a legal fiction? 

Wyoming Law Provides a Way to Test the Hypothesis 

In 2024, Wyoming passed the Wyoming Decentralized Unincorporated Nonprofit Association Act (DUNA), which allows blockchain networks like decentralized autonomous organizations (DAO) to operate under existing law and provide legal protections to the members. Pursuant to Wyoming law, a DAO may be an LLC that includes a statement in its articles of organization identifying the company as a DAO. DAOs are generally organized by people who want to achieve a shared goal by combining a digital asset. They may buy or fund an asset, socialize, or discuss a shared interest. Under the AI legal personhood model, BLIP has explored whether an AI could serve as the DAO’s autonomous agent—either acting directly as the managing member or holding its own membership interest alongside human participants.  

What Could AI Do?

As a recognized legal “person” within the LLC, the AI could (1) own and manage data contributions in its own name; (2) vote on governance proposals by executing smart‐contract rules on the blockchain; (3) enter into binding agreements—such as licensing, service, or revenue‑sharing contracts—with third parties; and (4) assume statutory duties and liabilities, including fiduciary obligations to other members. This arrangement embeds accountability and transparency at the protocol level: every decision the AI makes would be recorded on‑chain, and any breach of duty (for example, misuse of data or failure to distribute co‑op revenues) would give rise to traditional legal remedies—suits for breach of contract or fiduciary duty—just as against a corporate director.  

On a technical level, the AI would verify that each action is consistent with the information stored in prior blocks before approving the execution of the output. All members would have visibility into the inputs and outputs, and the proposed action would only proceed if approved by the majority consensus, as outlined in the operating agreement. Once the consensus is reached, the AI would then execute the agreed-upon output. By combining Wyoming’s DAO‑LLC statute with a forward‑looking legal fiction of AI personhood, BLIP has been creating a framework in which autonomous systems may meaningfully participate in, and be held responsible for, cooperative ventures in the digital economy. 

What Role Do Human Members Play? 

Under the concept of a DAO, the human, non-managerial members of the LLC would upload their opinions, beliefs, values, and objectives, which the AI would absorb and use to drive its decisions and to perform the appropriate actions—whether that be in the form of document creation, directives, or other purposes. Essentially, the AI becomes the executive empowered to effectuate the values and goals of the LLC’s non-managerial members. Due to the AI’s status as a manager of a DAO LLC, its legal personhood status needs to be established to ensure it can validly enter into contracts, fulfill fiduciary duties, be held liable for breaches, and ultimately be recognized as a responsible and accountable actor under U.S. law. By granting legal personhood to the AI, the law acknowledges its role not merely as a tool, but as a governance participant and data steward—capable of holding and exercising rights and obligations in the service of collective human interests in an increasingly digitized society. 

Since a DAO has rules encoded as a computer program and functions autonomously through smart contracts rather than through traditional corporate governance, there is a lack of jurisprudence guiding its implementation due to its novel nature. Rules and regulations may vary between jurisdictions, which creates a level of uncertainty regarding its viability. However, in the digital age, where technology advances at a rapid pace, the law must also adjust. AI has the potential to further our business and societal interests. Of course, there still remain profound issues surrounding responsible AI and the prospect of AI run amok, issues about which law and public policy have barely addressed. 

What Would Our First AI DAO LLC Do?  

BLIP has considered that the first business goal of the AI DAO LLC would be for the entity to serve as an invention and creation engine similar to the DABUS (Device for the Autonomous Bootstrapping of Unified Sentience) Machine, an artificial intelligence system invented by Stephen Thaler. The entity would deploy its algorithm to invent anything imaginable under the sun. The most noble of the inventions would be open-sourced and shared freely with the world, the most nefarious would be buried (hidden or patented depending on how best to keep them from use), and some inventions in the middle would be IP-protected and sold or licensed for commercial use. 

Of additional value, the entity could establish a trust, the beneficiaries of which would  be judgment proof (e.g., homeless, impoverished, and otherwise marginalized members of society, without any assets outside the trust). These persons, perhaps, could also be non-managerial members of the LLC, protected through the LLC’s liability protections (because, Askin and the students assert, why should only the wealthy be allowed to avail themselves of the liability and financial benefits of corporate structures?). 

In addition to serving as an Invention/Creation engine, the other tasks of the LLC might include filing amicus briefs seeking more judicial certainty on the IP issues surrounding AI-created works and inventions (because, the BLIP team concluded,  who better to speak on behalf of AI rights, than an AI engine itself?). Currently, the U.S. Court of Appeals for the District of Columbia Circuit has denied the right for AI to obtain patent or copyright protection, but Askin and the BLIP students hope that SCOTUS or Congress will define more precisely how and when AI might help in the creation process, so that the U.S. might continue to promote and lead the world in novel inventions and the arts.