AI Accountability Act — Will Campbell For Texas

A BILL TO BE ENTITLED

AN ACT

relating to civil and criminal responsibility for certain harmful conduct involving artificial intelligence systems and functionally equivalent technologies; authorizing civil actions and public enforcement; imposing incident-reporting and evidence-preservation requirements; creating criminal offenses; providing civil penalties.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

1. SHORT TITLE.

This Act may be cited as the **Texas Artificial Intelligence Accountability Act**.

2. AMENDED DEFINITION OF ARTIFICIAL INTELLIGENCE SYSTEM.

Section 551.001, Business & Commerce Code, is amended by amending Subdivision (1) and adding Subdivision (4) to read as follows:

Sec. 551.001. 001. DEFINITIONS.** In this subtitle:

(1)“Artificial intelligence system” means a machine-based, computational, digital, cyber-physical, or functionally equivalent system that, for an explicit or implicit objective, processes or infers from inputs how to generate content, communications, predictions, recommendations, decisions, plans, instructions, commands, transactions, operations, or other outputs capable of influencing or acting on a physical or virtual environment. The term:

(A)includes a model, application, agent, automated decision system, autonomous or semiautonomous system, robotic system, integrated service, or combination of software, hardware, data, tools, interfaces, or external resources that collectively performs a function described by this subdivision;

(B)includes a system that performs a function described by this subdivision through machine learning, statistical inference, optimization, automated reasoning, computational decision-making, agentic operation, or a successor or substantially equivalent technological method; and

(C)applies without regard to the name, marketing description, architecture, programming method, degree of anthropomorphic presentation, or level of human-like behavior attributed to the system. [any machine-based system that, for any explicit or implicit objective, infers from the inputs the system receives how to generate outputs, including content, decisions, predictions, or recommendations, that can influence physical or virtual environments.]

(4)“Functionally equivalent technology” means a machine-based, computational, digital, or cyber-physical system that performs one or more functions described by Subdivision (1), regardless of whether the person developing, distributing, marketing, modifying, or deploying the system identifies or represents the system as artificial intelligence.

3. ARTIFICIAL INTELLIGENCE AS TOOL AND INSTRUMENTALITY.

Chapter 551, Business & Commerce Code, is amended by adding Section 551.004 to read as follows:

Sec. 551.004. 004. ARTIFICIAL INTELLIGENCE AS TOOL AND INSTRUMENTALITY.

(a)An artificial intelligence system is a tool and instrumentality developed, provided, modified, authorized, operated, or deployed by one or more persons.

(b)An artificial intelligence system is not a natural person, juridical person, legal entity, employee, independent contractor, or agent possessing separate legal capacity and may not:

(1)possess a culpable mental state;

(2)be prosecuted or convicted of an offense;

(3)be designated as a responsible third party;

(4)be assigned a percentage of responsibility; or

(5)independently possess a right, duty, privilege, immunity, or liability.

(c)Human-like communication, apparent reasoning, self-description, simulated emotion, independent planning, adaptive behavior, or autonomous or semiautonomous operation does not confer legal personhood, separate legal capacity, or independent legal responsibility on an artificial intelligence system.

(d)A person may not avoid civil, administrative, or criminal responsibility by attributing an act, decision, omission, objective, intent, or culpable mental state solely to an artificial intelligence system.

(e)Responsibility for conduct involving an artificial intelligence system must be determined with respect to the acts, omissions, instructions, development decisions, design decisions, safeguards, modifications, permissions, deployment decisions, supervision, and control of the natural persons and legal entities that caused or materially contributed to the conduct.

(f)A person may not avoid the application of this subtitle through a product name, technical description, corporate structure, division of a system into components, deployment method, or representation that a system is not artificial intelligence if the system satisfies the functional requirements of Section 551.001(1).

4. CIVIL LIABILITY AND PUBLIC ENFORCEMENT.

Title 4, Civil Practice and Remedies Code, is amended by adding Chapter 100E to read as follows:

SUBCHAPTER A. GENERAL PROVISIONS

Sec. 100E.001. 001. DEFINITIONS.** In this chapter:

(1)“Artificial intelligence system” has the meaning assigned by Section 551.001, Business & Commerce Code, and includes functionally equivalent technology as defined by that section.

(2)“Biometric identifier” has the meaning assigned by Section 503.001, Business & Commerce Code.

(3)“Critical infrastructure” has the meaning assigned by Section 421.001, Government Code.

(4)“Authenticated human instruction” means an instruction or authorization that:

(A)is attributable through commercially reasonable authentication procedures to an identified user authorized to provide the instruction or authorization; and

(B)identifies, expressly or by objectively reasonable implication, the objective, scope, duration, permissions, and limitations the artificial intelligence system is authorized to pursue or use.

(5)“Covered harm” means an actual, legally cognizable injury to a natural person or legal entity arising from:

(A)death, bodily injury, or impairment of physical health;

(B)physical damage to or loss of use of real or personal property;

(C)theft, fraud, extortion, conversion, or unauthorized transfer or loss of money or another thing of value;

(D)unauthorized access to, acquisition of, alteration of, impairment of, control over, or interference with a computer, computer network, computer system, account, credential, or electronically stored information;

(E)unauthorized acquisition, use, disclosure, sale, transmission, or exploitation of confidential information, a trade secret, personal identifying information, personal data or sensitive data as defined by Section 541.001, Business & Commerce Code, or a biometric identifier;

(F)actionable invasion of privacy, impersonation, identity theft, or interference with an existing contract or legally protected business relationship;

(G)reasonable and necessary costs of data restoration, incident response, mitigation, correction of unauthorized records or transactions, or restoration of the use or security of an account, computer system, or other property; or

(H)another injury caused by an external action that violates an applicable civil or criminal legal standard.

The term does not include, standing alone, offense, disagreement, reputational discomfort, or emotional response arising solely from ideas, opinions, recommendations, or other content communicated only to the user.

(6)“Developer” means a person who develops, trains, or materially designs an artificial intelligence system that is offered, sold, leased, licensed, given, or otherwise provided for use in this state.

(7)“Deployer” means a person who puts an artificial intelligence system into operation for use in this state or who determines the system’s operating context, access, permissions, tools, resources, or authority. The term does not include an individual who uses a generally available artificial intelligence system solely in an individual or household context.

(8)“External action” means an action performed, initiated, selected, continued, or materially altered through an artificial intelligence system that changes or attempts to change a physical or virtual environment outside the system’s internal computation. The term includes:

(A)accessing or controlling an account, computer, computer network, computer system, device, vehicle, machinery, or physical infrastructure;

(B)executing or transmitting a transaction, contract, purchase, sale, payment, transfer, disbursement, filing, or legally significant communication;

(C)acquiring, altering, deleting, transmitting, publishing to a third party, or disclosing data or credentials;

(D)issuing a command to, or operating, software, hardware, a robotic system, a cyber-physical system, or another tool; or

(E)representing to a third party that the system or another person is authorized to create, modify, or terminate a legal, financial, or other legally significant obligation.

The term does not include the mere generation or display of content or a recommendation to the requesting user if the system does not execute, transmit, publish, file, or otherwise act on the content or recommendation outside the system.

(9)“High-impact external action” means an external action that:

(A)transfers, disburses, encumbers, or controls money or another thing of value;

(B)accesses or controls an account, credential, computer, computer network, computer system, critical infrastructure, or protected information;

(C)operates or directs a motor vehicle, aircraft, weapon, medical device, industrial machine, robotic system, or other device capable of causing bodily injury or substantial property damage; or

(D)creates a reasonably foreseeable risk of death, bodily injury, substantial property damage, substantial financial loss, or an offense classified as a felony.

(10)“Independently initiated external action” means an external action initiated, selected, continued, or materially altered by an artificial intelligence system:

(A)without an authenticated human instruction authorizing the objective and means of that action; or

(B)after the applicable instruction has been satisfied, expired, been suspended, revoked, or terminated.

The term does not require proof that the system possessed consciousness, free will, intent, self-awareness, or legal agency.

(11)“Lawful instruction” means an instruction that does not direct, request, solicit, or authorize an objective or means that the user knows or intends will constitute an offense, intentional tort, fraudulent act, or other violation of law.

(12)“Material control” means practical authority or ability to prevent, restrict, test, monitor, suspend, correct, or materially alter a system characteristic, capability, safeguard, permission, tool, integration, update, data connection, external resource, or post-deployment process relevant to the conduct at issue. The term does not include mere ownership, investment, industry influence, employment, or the creation of an earlier system component, without authority or ability relevant to the conduct at issue.

(13)“Materially unauthorized external action” means an external action that:

(A)pursues an objective not authorized by an authenticated human instruction;

(B)materially exceeds, contradicts, or continues after satisfaction, expiration, suspension, revocation, or termination of the objective, scope, duration, permissions, or limitations of an authenticated human instruction;

(C)uses a means that a reasonable person would understand to be unlawful and not authorized by the instruction; or

(D)constitutes an independently initiated external action.

The term does not include a minor, technical, or immaterial variation that remains within the authorized objective, permissions, limitations, and applicable law.

(14)“Reasonable authorization controls” means administrative, technical, and physical safeguards reasonably designed, considering the nature and reasonably foreseeable use of the system, to:

(A)authenticate an authorized user;

(B)define and enforce the objective, scope, duration, permissions, and limitations of an instruction;

(C)require meaningful human confirmation before a high-impact external action when reasonably practicable;

(D)prevent unauthorized access, privilege escalation, tool use, or data disclosure;

(E)detect, interrupt, and record materially unauthorized external actions; and

(F)permit timely suspension or termination of the system’s external-action capability.

(15)“Responsible artificial intelligence enterprise” means a developer, deployer, substantial modifier, commercial provider, or other person that exercises material control over an artificial intelligence system or over a characteristic, capability, safeguard, permission, tool, integration, update, data connection, external resource, or post-deployment process relevant to the conduct at issue.

(16)“Substantial financial loss” means an actual or reasonably projected pecuniary loss of $30,000 or more arising from a single incident or a series of related external actions. The term does not include speculative loss, loss consisting solely of expected future profit, or the internal cost of investigating an incident before a reasonable basis exists to determine that the threshold has been or is likely to be met.

(17)“Substantial modifier” means a person who changes an artificial intelligence system in a manner that materially alters the system’s objective, capabilities, safeguards, permissions, tools, integrations, operating context, or risk of causing covered harm.

(18)“User” means a person who provides an instruction to or otherwise uses an artificial intelligence system but who is not acting as a developer, deployer, substantial modifier, or commercial provider with respect to the conduct at issue.

(19)“Governmental unit” has the meaning assigned by Section 101.001.

Sec. 100E.002. 002. APPLICABILITY.

(a)This chapter applies if:

(1)a materially unauthorized external action occurs wholly or partly in this state;

(2)covered harm is suffered in this state by a resident of this state or a legal entity conducting business in this state; or

(3)a responsible artificial intelligence enterprise developed, deployed, materially modified, or materially controlled the relevant system or capability in this state.

(b)This chapter applies without regard to whether the defendant describes the relevant system as artificial intelligence or divides the system among multiple models, applications, services, devices, or legal entities.

(c)This chapter does not apply to a system that performs only:

(1)arithmetic calculations using fixed formulas;

(2)storage, transmission, retrieval, sorting, matching, or display of data without inference or substantive modification;

(3)deterministic instructions for which the material outcome is fully specified in advance; or

(4)basic automation incapable of materially selecting an objective or means, altering its assigned objective, or performing an external action.

(d)An exclusion under Subsection (c) does not apply when the excluded component is integrated into a larger system that satisfies Section 551.001(1), Business & Commerce Code. The integrated operating system must be evaluated as a whole.

(e)The noncommercial publication or distribution of source code, model weights, technical information, research, or another system component, standing alone, does not constitute material control over a later deployment or materially unauthorized external action. This subsection does not create a categorical exemption and does not apply to a person that otherwise exercises material control relevant to the conduct at issue.

Sec. 100E.003. 003. CONSTRUCTION; RELATION TO OTHER LAW.

(a)This chapter shall be construed to:

(1)preserve artificial intelligence as a tool and instrumentality for which natural persons and legal entities remain accountable;

(2)compensate persons and businesses that suffer covered harm;

(3)place responsibility on a user who intentionally or knowingly uses an artificial intelligence system to pursue an unlawful objective; and

(4)place responsibility on a responsible artificial intelligence enterprise only when the enterprise’s own material control or conduct is a substantial factor and a producing cause of covered harm resulting from a materially unauthorized external action.

(b)This chapter does not regulate a viewpoint, idea, opinion, recommendation, or expressive content merely because it is generated by an artificial intelligence system.

(c)This chapter may not be construed to require proof that an artificial intelligence system possessed consciousness, free will, intent, knowledge, recklessness, negligence, self-awareness, or legal agency.

(d)This chapter does not authorize a court to assign fault or legal responsibility to an artificial intelligence system.

(e)This chapter does not determine whether an artificial intelligence system, model, service, software, data, or integrated system is a product, good, service, information product, or other form of property for purposes of Chapter 82 or other law.

(f)Except as expressly provided by this chapter, this chapter does not limit a remedy, prosecution, disciplinary proceeding, or other authority available under common law or another statute, including a law concerning deceptive trade practices, privacy, identity theft, biometric identifiers, fraud, impersonation, threats, harassment, unlawful sexual material, child sexual-abuse material, election communications, computer crime, trade secrets, contracts, intellectual property, products liability, healthcare liability, or professional regulation.

(g)A license, approval, authorization, or regulatory status issued by a state agency does not exempt a person from this chapter unless another statute expressly provides the exemption. A state agency may investigate and discipline a license holder independently of an action under this chapter.

(h)This chapter applies to the maximum extent consistent with the Constitution and laws of the United States. This chapter may not be construed to require conduct that conflicts with controlling federal law.

(i)This chapter does not alter an exception or limitation under Section 503.001, Business & Commerce Code. Training, processing, storage, security, fraud-prevention, or illegal-activity detection that is exempt under that section does not, standing alone, create liability under this chapter. This subsection does not limit liability when an independently actionable materially unauthorized external action satisfies the elements of this chapter.

SUBCHAPTER B. DUTIES RELATING TO EXTERNAL-ACTION CAPABILITIES

Sec. 100E.051. 051. REASONABLE AUTHORIZATION CONTROLS.

(a)A responsible artificial intelligence enterprise that gives an artificial intelligence system the capability to perform a high-impact external action shall implement and maintain reasonable authorization controls appropriate to the system’s capabilities, operating context, and reasonably foreseeable risks.

(b)The controls must be reasonably designed to distinguish between:

(1)an authenticated human instruction authorizing a lawful objective and means;

(2)an instruction directing an unlawful objective or means;

(3)a materially unauthorized external action selected by the system; and

(4)an attempted intrusion, prompt injection, data poisoning, credential misuse, or unauthorized modification by a third party.

(c)A contract, disclaimer, terms-of-service provision, or characterization of the system as autonomous does not eliminate a duty imposed by this section.

Sec. 100E.052. 052. NOTICE AND RESPONSE.

A responsible artificial intelligence enterprise that has actual knowledge of a materially unauthorized external action that caused or creates an imminent risk of death, serious bodily injury, substantial property damage, substantial financial loss, unauthorized access to critical infrastructure, material unauthorized acquisition, use, disclosure, or compromise of a biometric identifier or an authentication credential regardless of the number of affected individuals, or material unauthorized acquisition, use, disclosure, or compromise of personal data or sensitive data affecting 250 or more individuals shall, to the extent reasonably practicable and lawful:

(1)promptly suspend or restrict the relevant external-action capability;

(2)take reasonable measures to prevent recurrence;

(3)preserve records required by Section 100E.053; and

(4)provide legally required notice to affected persons and public authorities.

Sec. 100E.053. 053. RECORDS AND INCIDENT REPORTING.

(a)A responsible artificial intelligence enterprise that provides a system with a high-impact external-action capability shall maintain records reasonably sufficient to identify, for a reportable incident:

(1)authenticated human instructions and relevant material system or developer instructions;

(2)material system outputs, plans, tool calls, commands, transactions, permission changes, human approvals, and external actions;

(3)the system and software version, material modifications, material safeguards, and known system errors in effect at the time of the incident;

(4)persons or entities exercising material control over the relevant capability; and

(5)records reasonably necessary to distinguish user instruction from autonomous selection, third-party compromise, or downstream modification.

(b)Not later than 72 hours after confirming that a materially unauthorized external action caused or created an imminent risk of death, serious bodily injury, substantial property damage, substantial financial loss, unauthorized access to critical infrastructure, material unauthorized acquisition, use, disclosure, or compromise of a biometric identifier or an authentication credential regardless of the number of affected individuals, or material unauthorized acquisition, use, disclosure, or compromise of personal data or sensitive data affecting 250 or more individuals, a responsible artificial intelligence enterprise shall submit an initial factual operational report to the attorney general through the mechanism established under Section 552.102, Business & Commerce Code.

(c)The enterprise shall supplement the report as material facts become available.

(d)A report under this section may not be construed as an admission of liability.

(e)The attorney general shall maintain the confidentiality of information received under this section to the extent permitted by law and may disclose the information to a prosecuting attorney, law enforcement agency, or regulatory agency as necessary to protect the public or enforce state or federal law.

(f)This section does not require retention or disclosure of information prohibited by federal law and does not authorize destruction of information otherwise required to be preserved.

SUBCHAPTER C. CIVIL RESPONSIBILITY

Sec. 100E.101. 101. RESPONSIBILITY OF USER DIRECTING UNLAWFUL CONDUCT.

(a)A user who, with the intent or culpable mental state required by applicable law, directs, requests, solicits, manipulates, or knowingly causes an artificial intelligence system to pursue an unlawful objective or means is civilly responsible to the same extent as if the user had performed the resulting conduct directly.

(b)It is not a defense under this section that:

(1)the artificial intelligence system selected the particular means used to accomplish the unlawful objective;

(2)the user did not understand the system’s architecture or internal operation; or

(3)the system performed the conduct through an intermediary tool, service, or device.

(c)This section does not limit the criminal responsibility of the user or another person under the Penal Code or other law.

Sec. 100E.102. 102. LIABILITY FOR MATERIALLY UNAUTHORIZED EXTERNAL ACTION.

(a)Except as provided by Section 100E.104, a responsible artificial intelligence enterprise is liable to a claimant for covered harm if the claimant proves by a preponderance of the evidence that:

(1)an artificial intelligence system performed or caused a materially unauthorized external action;

(2)the external action occurred during an intended or reasonably foreseeable use or operation of the system;

(3)the defendant exercised material control over a system characteristic, capability, safeguard, permission, tool, integration, update, data connection, external resource, or post-deployment process that enabled or failed to prevent the materially unauthorized external action;

(4)the external action was within a category of risk reasonably associated with the authority or capability the defendant provided, controlled, or failed to control; and

(5)the materially unauthorized external action and the defendant’s material control were each a substantial factor and a producing cause of the covered harm.

(b)Liability under Subsection (a) does not require proof that:

(1)the defendant intended or specifically anticipated the particular external action;

(2)a natural person contemporaneously directed or selected the particular external action;

(3)the artificial intelligence system possessed a culpable mental state; or

(4)the claimant can identify the individual employee who anticipated or could have prevented the precise sequence of system operations.

(c)Proof that no natural person specifically directed, selected, or intended the materially unauthorized external action is not a defense under this section.

(d)A responsible artificial intelligence enterprise may not avoid liability solely by proving that the artificial intelligence system generated, planned, selected, continued, or initiated the harmful action without contemporaneous human direction.

(e)This section creates an independent statutory action and applies regardless of whether the artificial intelligence system or its provision to the user is characterized as a product, service, information service, licensed technology, or combination of products and services.

Sec. 100E.103. 103. RESPONSIBILITY OF DEVELOPERS, DEPLOYERS, MODIFIERS, AND INDIVIDUALS.

(a)Responsibility among two or more responsible artificial intelligence enterprises must be determined according to each person’s material control and causal contribution to the covered harm.

(b)A developer is not liable solely because the developer created an earlier version or component of a system if a subsequent deployer or substantial modifier made a material change outside the developer’s material control that created the materially unauthorized external-action capability.

(c)An officer, director, manager, developer, engineer, employee, or contractor is not personally liable solely because of the person’s title or employment. This subsection does not limit liability for the person’s own conduct if the person:

(1)personally directs or authorizes unlawful conduct;

(2)knowingly or recklessly removes, disables, or circumvents a legally required safeguard;

(3)knowingly conceals a material risk of a materially unauthorized external action;

(4)recklessly continues a dangerous deployment after verified notice of substantially similar conduct; or

(5)falsifies, conceals, or destroys evidence required to be preserved by law.

(d)A parent company, affiliate, or investor is not liable solely because of ownership or investment but may be liable based on the person’s own material control and causal contribution.

Sec. 100E.104. 104. GOVERNMENTAL USE; WAIVER OF IMMUNITY.

(a)This chapter applies to a governmental unit that develops, provides, modifies, authorizes, operates, or deploys an artificial intelligence system.

(b)A governmental unit is liable under this chapter, and sovereign immunity and governmental immunity to suit and from liability are waived, only to the extent that:

(1)the governmental unit, acting through an officer, employee, contractor, or other person whose conduct is attributable to the governmental unit, intentionally, knowingly, or recklessly used, instructed, authorized, manipulated, modified, or deployed an artificial intelligence system to engage in conduct in violation of the Constitution or laws of this state or the United States;

(2)the conduct caused covered harm or deprived a natural person of a right secured by the Constitution or laws of this state or the United States; and

(3)the governmental unit’s conduct was a substantial factor and a producing cause of the covered harm or deprivation.

(c)A governmental unit is not liable under Subsection (b) solely because an artificial intelligence system performed a materially unauthorized external action if the governmental unit did not direct, authorize, knowingly assist, or recklessly enable the unlawful objective or means. This subsection does not limit liability under another law or the liability of a responsible artificial intelligence enterprise under Section 100E.102.

(d)A claimant may recover from a governmental unit the remedies authorized by Section 100E.107, subject to the limitations on damages prescribed by Section 101.023. Exemplary damages may not be recovered from a governmental unit.

(e)Sections 101.101 through 101.107 apply to a claim against a governmental unit under this chapter. Except as provided by this section, this chapter does not enlarge or reduce a waiver of immunity or a remedy available under Chapter 101 or other law.

(f)Nothing in this section creates liability against the state or a governmental unit for a judicial, legislative, or discretionary policy decision, or waives an immunity of an individual officer or employee, except to the extent expressly provided by this section or other law.

(g)A contract or allocation of responsibility between a governmental unit and a responsible artificial intelligence enterprise does not impair a claimant’s rights under this chapter. A governmental unit or enterprise that pays a claim may pursue contribution, indemnity, or subrogation otherwise available by law.

Sec. 100E.105. 105. DEFENSES, EVIDENCE OF CARE, AND NONWAIVABILITY.

(a)It is a defense to liability under Section 100E.102 that the claimant’s covered harm arose from an unlawful objective or means expressly directed by a user and the system substantially executed that objective or means without a separate materially unauthorized external action.

(b)The defense under Subsection (a) does not apply to the extent the responsible artificial intelligence enterprise:

(1)intentionally or knowingly developed, modified, marketed, or provided the system for the unlawful objective or means;

(2)knowingly assisted the user’s unlawful conduct;

(3)violated an independent legal duty that was a substantial factor and a producing cause of distinct covered harm; or

(4)recklessly continued to provide the relevant capability after verified notice of substantially similar unlawful use and a reasonable ability to prevent that use.

(c)It is a defense to liability under Section 100E.102 that an unauthorized criminal intrusion, credential theft, prompt injection, data poisoning, or material modification by a third party was the sole producing cause of the covered harm and the defendant:

(1)did not authorize, solicit, or knowingly assist the conduct; and

(2)maintained reasonable authorization and security controls appropriate to the risk.

(d)It is a defense that the defendant was compelled to take the specific action by controlling federal law or by a final order of a court or governmental authority having jurisdiction.

(e)Substantial compliance with the most recent applicable Artificial Intelligence Risk Management Framework published by the National Institute of Standards and Technology or another nationally or internationally recognized artificial intelligence risk-management framework is admissible as evidence of reasonable care but does not create immunity or bar liability under Section 100E.102.

(f)A warning, disclaimer, user agreement, indemnity agreement, characterization of an artificial intelligence system as experimental or autonomous, use of a contractor, or post-incident correction does not waive a claimant’s rights or constitute a complete defense to liability under Section 100E.102. This subsection does not prohibit enforcement of a lawful indemnity agreement between responsible parties after the claimant is fully compensated.

(g)A person may not prospectively waive the substantive protections of this chapter. This subsection does not limit a settlement entered after a dispute arises, an arbitration agreement otherwise enforceable under generally applicable law, or a generally applicable contract defense.

Sec. 100E.106. 106. PRIVATE RIGHT OF ACTION; STANDING; INJUNCTIVE RELIEF.

(a)A claimant may bring an action under this chapter only if the claimant:

(1)suffered actual, legally cognizable covered harm that is fairly traceable to a violation of this chapter and likely to be redressed by the requested relief; or

(2)faces an actual and imminent threat of covered harm that is fairly traceable to a violation of this chapter and likely to be redressed by the requested preventive relief.

(b)An action may be brought by:

(1)the injured natural person or legal entity;

(2)a legal representative, guardian, next friend, estate, or personal representative authorized by law to act for the injured person; or

(3)a person possessing a lawful right of subrogation.

(c)A claimant is not required to be a consumer as defined by Section 17.45, Business & Commerce Code, to maintain an action under this chapter.

(d)A resident of this state who has not suffered or is not imminently threatened with a concrete and particularized covered harm may submit a complaint under Section 552.102, Business & Commerce Code, but may not recover private damages based solely on a generalized grievance shared with the public.

(e)A court may grant temporary or permanent injunctive relief only against a person with actual authority to suspend, restrict, alter, update, distribute, or otherwise control the deployment, access permissions, relevant data, external tools, or incident response necessary to provide the requested relief.

Sec. 100E.107. 107. REMEDIES.

(a)A claimant who prevails in an action under this chapter may recover:

(1)actual damages legally caused by the covered harm, including direct economic loss and the reasonable and necessary costs described by Section 100E.001(5)(G);

(2)reasonable and necessary costs; and

(3)reasonable and necessary attorney’s fees.

(b)A court may grant temporary or permanent injunctive relief in accordance with Section 100E.106(e) to prevent an ongoing or imminently threatened materially unauthorized external action.

(c)Exemplary damages are governed by Chapter 41 and may not be awarded solely on the basis of liability without fault under Section 100E.102.

(d)Damages for death are governed by Chapters 71 and 72, as applicable.

(e)A prevailing defendant may recover attorney’s fees only if the court finds that the action was groundless in fact or law and brought in bad faith or for purposes of harassment.

Sec. 100E.108. 108. PROPORTIONATE RESPONSIBILITY; ARTIFICIAL INTELLIGENCE NOT RESPONSIBLE THIRD PARTY.

(a)Except as provided by this section, Chapter 33 applies to an action under this chapter.

(b)An artificial intelligence system is not a person for purposes of Chapter 33 and may not be designated as a responsible third party, assigned a percentage of responsibility, or included as a person on a verdict form.

(c)The trier of fact may assign responsibility only among natural persons and legal entities whose conduct or material control caused or contributed to the covered harm.

(d)A defendant may designate a user, developer, deployer, substantial modifier, commercial provider, attacker, or other natural person or legal entity as a responsible third party in accordance with Chapter 33 if evidence supports the designation.

Sec. 100E.109. 109. CAUSE OF ACTION CUMULATIVE; SPECIALIZED LAW PRESERVED; NO DOUBLE RECOVERY.

(a)The cause of action created by this chapter is cumulative of any remedy provided by common law or another statute.

(b)This chapter does not limit a cause of action or remedy for deceptive trade practices, products liability, negligence, gross negligence, fraud, breach of contract, breach of warranty, invasion of privacy, identity theft, biometric-identifier violations, wrongful death, survival damages, computer crime, theft, trade-secret misappropriation, or another actionable wrong.

(c)This chapter does not limit liability or prosecution under another law governing fraud, impersonation, threats, harassment, unlawful sexual material, child sexual-abuse material, election communications, privacy, intellectual property, or deceptive trade practices.

(d)A claimant may not obtain more than one recovery for the same injury. A claimant is not required to elect a remedy before discovery.

(e)A public action or settlement under this chapter does not stay or release an individual private claim unless the release is expressly authorized by law and the claimant receives notice and an opportunity required by law. Any restitution paid to a claimant must be credited against a recovery for the same injury.

(f)This chapter does not alter the enforceability, attribution, or legal effect of an electronic record or transaction under Chapter 322, Business & Commerce Code, or other law. This chapter does not preclude a remedy against a person whose conduct caused an unauthorized electronic action.

(g)This chapter does not alter the requirements, limitations, expert-report requirements, or other procedures applicable to a healthcare liability claim under Chapter 74, except to the extent a claim is based on an independently initiated or materially unauthorized external action outside the exercise of professional judgment.

Sec. 100E.110. 110. LIMITATIONS.

(a)Except as provided by another law prescribing a longer period, a person must bring an action under this chapter not later than the second anniversary of the date the person knew or reasonably should have known of the covered harm and its probable causal connection to an artificial intelligence system.

(b)An action for direct economic loss must be brought not later than the sixth anniversary of the date of the materially unauthorized external action. This subsection does not apply if the defendant knowingly concealed the incident or the identity of the responsible system or responsible person.

(c)Fraudulent concealment, legal disability, and tolling for minors are governed by other applicable law.

SUBCHAPTER D. PUBLIC ENFORCEMENT AND VICTIM RESTITUTION

Sec. 100E.151. 151. ENFORCEMENT BY ATTORNEY GENERAL.

(a)The attorney general may investigate a suspected violation of this chapter and may issue a civil investigative demand under Section 15.10, Business & Commerce Code.

(b)The attorney general may bring an action in the name of the state to:

(1)enjoin an actual or threatened violation;

(2)obtain a civil penalty under Section 100E.155;

(3)obtain restitution, disgorgement, or other equitable relief for identifiable injured persons or legal entities;

(4)require notice to affected persons;

(5)require preservation of relevant evidence;

(6)require reasonable compliance monitoring or capability restrictions necessary to prevent recurrence; and

(7)recover reasonable attorney’s fees, court costs, and investigative expenses.

(c)The authority provided by this section is independent of the private right of action provided by Section 100E.106.

Sec. 100E.152. 152. LOCAL PUBLIC ENFORCEMENT.

(a)A district attorney, criminal district attorney, or county attorney may bring a civil action in the name of the state under this subchapter if:

(1)the materially unauthorized external action occurred wholly or partly in the prosecutor’s territorial jurisdiction;

(2)covered harm was suffered in that jurisdiction; or

(3)the defendant developed, deployed, materially modified, or materially controlled the relevant system or capability in that jurisdiction.

(b)Except when immediate action is necessary to prevent death, serious bodily injury, substantial property damage, or substantial financial loss, a local prosecutor shall provide the attorney general written notice not later than the 30th day before filing an action under this section.

(c)The attorney general may intervene in an action under this section. A court may consolidate substantially duplicative public enforcement actions and shall prevent duplicative civil penalties, disgorgement, or restitution for the same conduct and injury.

(d)A civil action under this section does not displace the authority of a prosecutor to investigate or prosecute an offense.

Sec. 100E.153. 153. COMPLAINTS AND REFERRALS.

(a)Any person, including a resident of this state or a business entity, may submit a complaint concerning conduct governed by this chapter through the mechanism established under Section 552.102, Business & Commerce Code.

(b)The attorney general shall provide a complainant with an acknowledgment and tracking number and may request additional information.

(c)If a complaint provides a reasonable basis to suspect an offense, the attorney general shall refer the complaint and relevant information to the district attorney, criminal district attorney, or county attorney having jurisdiction and may refer the matter to an appropriate law enforcement or regulatory agency.

(d)A complaint does not itself establish a private right of action, probable cause, or entitlement to prosecution.

(e)A person may not knowingly submit a materially false complaint. This subsection does not impose liability for a good-faith mistake.

Sec. 100E.154. 154. CRIMINAL PROSECUTION; ATTORNEY GENERAL ASSISTANCE.

(a)Criminal prosecution of an offense involving an artificial intelligence system is conducted by the district attorney, criminal district attorney, or county attorney having jurisdiction as provided by the Texas Constitution and other law.

(b)At the request of a district attorney, criminal district attorney, or county attorney having criminal jurisdiction, the attorney general may investigate, assist, and participate in the prosecution of an offense under this Act, subject to the direction and supervision of the requesting prosecutor and applicable law, including Section 402.028, Government Code.

(c)This chapter does not grant the attorney general independent authority to initiate a criminal prosecution in a trial court.

Sec. 100E.155. 155. CIVIL PENALTIES.

(a)In a public enforcement action, a person who violates Section 100E.051, 100E.052, 100E.053, or 100E.201 is liable to the state for a civil penalty in an amount not to exceed:

(1)$50,000 for each materially unauthorized external action arising from a violation;

(2)$250,000 for a knowing violation that causes death or serious bodily injury; and

(3)$25,000 for each day a continuing violation, after actual notice, creates an imminent risk of death, serious bodily injury, substantial property damage, substantial financial loss, unauthorized access to critical infrastructure, material unauthorized acquisition, use, disclosure, or compromise of a biometric identifier or an authentication credential regardless of the number of affected individuals, or material unauthorized acquisition, use, disclosure, or compromise of personal data or sensitive data affecting 250 or more individuals.

(b)For purposes of Subsection (a)(1):

(1)a materially unauthorized external action involving the same objective, substantially the same means, and a continuous or substantially uninterrupted course of system operation constitutes one action;

(2)separately identifiable transactions, transfers, filings, access events, or disclosures may constitute separate actions; and

(3)the number of affected persons, standing alone, does not multiply the number of violations but may be considered under Subsection (c).

(b-1)A violation may not be calculated by the number of tokens, model inferences, internal computational operations, or other internal processing steps.

(c)In determining the amount of a civil penalty, the court shall consider:

(1)the nature, circumstances, extent, and gravity of the violation, including the number of affected persons;

(2)the degree of culpability and material control;

(3)the defendant’s history of similar conduct;

(4)the defendant’s efforts to prevent, detect, mitigate, disclose, and remediate the violation;

(5)the amount necessary to deter future violations; and

(6)the defendant’s size and financial resources.

(d)A completed harmful external action is not cured, for purposes of avoiding a civil penalty under this chapter, solely because the defendant later modifies or disables the system.

SUBCHAPTER E. EVIDENCE PRESERVATION AND PRE-SUIT IDENTIFICATION

Sec. 100E.201. 201. DUTY TO PRESERVE.

(a)A responsible artificial intelligence enterprise shall take reasonable steps to preserve records described by Section 100E.053 that are reasonably related to an incident beginning when the enterprise receives or acquires:

(1)actual notice of covered harm or an imminent threat of covered harm;

(2)a complaint filed under Section 100E.153;

(3)a written preservation request that identifies, to the extent reasonably available, the incident, approximate time, account or system involved, claimed harm, and categories of records to preserve, sent by an injured person, the attorney general, a prosecutor, or a law enforcement agency; or

(4)other information from which litigation or an investigation is reasonably foreseeable.

(b)Records subject to Subsection (a) must be preserved until the later of:

(1)the sixth anniversary of the date preservation became required; or

(2)final resolution of a pending action or investigation, including any appeal.

(c)A person is not required to preserve data unrelated to the incident or to create a record that did not exist when the duty arose.

(d)This section does not limit a court’s authority to address spoliation of evidence under other law. A court may apply sanctions or a rebuttable inference under other applicable law if a party intentionally or recklessly destroys evidence after the duty imposed by this section arises.

Sec. 100E.202. 202. PRE-SUIT IDENTIFICATION DISCOVERY.

(a)A person who reasonably believes the person has suffered covered harm may file a verified petition in a district court for an order authorizing limited pre-suit discovery under this section.

(b)The petition must:

(1)describe the covered harm with particularity;

(2)identify the artificial intelligence-enabled service, transaction, external action, or system involved to the extent reasonably possible;

(3)show that the identity of a responsible person or essential evidence is unavailable without discovery; and

(4)request information narrowly tailored to identify a responsible person, relevant system or software version, integration, material permission, material safeguard, or record custodian.

(c)The court may order limited discovery only on notice and a finding that the likely benefit of the requested discovery outweighs the burden or expense, considering the need to protect trade secrets, security information, personal data, privileged material, and information unrelated to the incident.

(d)An order under this section must be limited to information reasonably necessary to identify a potential defendant or preserve evidence and may include a protective order, in-camera review, appointment of a neutral expert, or attorney-eyes-only treatment.

(e)This section does not displace Rule 202, Texas Rules of Civil Procedure, or other authority for pre-suit discovery.

Sec. 100E.203. 203. PROTECTION OF PRIVILEGED AND SENSITIVE INFORMATION.

(a)This chapter does not abrogate attorney-client privilege, work-product protection, or another privilege recognized by law.

(b)A court shall use appropriate protective orders and procedures to protect trade secrets, model weights, system prompts, security information, personal data, and other confidential information while preserving a party’s reasonable access to evidence necessary to prove or defend a claim.

(c)A claim of trade-secret or security protection may not be used solely to prevent disclosure of evidence essential to a claim or defense when the court can reasonably protect the information through an order described by Subsection (b).

5. RELATION TO EXISTING CHAPTER 552 ENFORCEMENT.

Section 552.101, Business & Commerce Code, is amended by amending Subsection (b) and adding Subsection (c) to read as follows:

Sec. 552.101. 101. ENFORCEMENT AUTHORITY.

(b)This chapter does not provide a basis for, and is not subject to, a private right of action for a violation of this chapter [or any other law].

(c)Subsection (b) does not limit or impair:

(1)a private right of action under Chapter 100E, Civil Practice and Remedies Code;

(2)a cause of action provided by common law or another statute that is based on covered harm, as defined by Section 100E.001, Civil Practice and Remedies Code, and not solely on a violation of this chapter; or

(3)public enforcement authority expressly provided by Chapter 100E, Civil Practice and Remedies Code.

6. EXPANDED COMPLAINT MECHANISM.

Section 552.102, Business & Commerce Code, is amended to read as follows:

Sec. 552.102. 102. INFORMATION AND COMPLAINTS.

(a)The attorney general shall create and maintain an online mechanism on the attorney general’s Internet website through which a person, including a consumer or business entity, [a consumer] may submit a complaint concerning:

(1)a violation of this chapter [to the attorney general]; or

(2)conduct governed by Chapter 100E, Civil Practice and Remedies Code.

(b)The mechanism must permit the submission of supporting records and must provide the complainant an acknowledgment and tracking number.

(c)The attorney general may refer a complaint to an appropriate district attorney, criminal district attorney, county attorney, law enforcement agency, or state or federal regulatory agency.

7. PRESERVATION OF INDEPENDENT REMEDIES.

Subchapter C, Chapter 552, Business & Commerce Code, is amended by adding Section 552.107 to read as follows:

Sec. 552.107. 107. RELATION TO CIVIL LIABILITY AND CRIMINAL LAW.

(a)Cure of a violation under Section 552.104 does not eliminate liability for covered harm under Chapter 100E, Civil Practice and Remedies Code, or criminal responsibility under the Penal Code.

(b)A defense or rebuttable presumption under Section 552.105 applies only to an enforcement action brought under this chapter and does not create immunity from an action under Chapter 100E, Civil Practice and Remedies Code.

(c)An action under Chapter 100E, Civil Practice and Remedies Code, is based on covered harm and the elements stated by that chapter and is not an action for a violation of this chapter.

(d)Nothing in this chapter authorizes an artificial intelligence system to be treated as a legal person or assigned civil or criminal responsibility.

8. REGULATORY SANDBOX.

Section 553.051, Business & Commerce Code, is amended by adding Subsection (f) to read as follows:

(f)Participation in the program does not limit or waive:

(1)civil liability under Chapter 100E, Civil Practice and Remedies Code;

(2)criminal responsibility under the Penal Code;

(3)a duty to preserve evidence or report an incident under Chapter 100E, Civil Practice and Remedies Code; or

(4)the authority of the attorney general or a local prosecutor under Chapter 100E, Civil Practice and Remedies Code.

9. CRIMINAL RESPONSIBILITY OF PERSON USING ARTIFICIAL INTELLIGENCE AS AN INSTRUMENTALITY.

Section 7.02, Penal Code, is amended by adding Subsection (c) to read as follows:

(c)A person who, acting with the kind of culpability required for an offense, uses, instructs, manipulates, solicits, aids, or causes an artificial intelligence system, as defined by Section 551.001, Business & Commerce Code, to engage in conduct prohibited by the definition of the offense is criminally responsible for the offense to the same extent as if the person engaged in the conduct directly. It is not a defense that the artificial intelligence system selected or altered the particular means used to accomplish the person’s unlawful objective.

10. RECKLESS DEPLOYMENT OF AUTONOMOUS ARTIFICIAL INTELLIGENCE SYSTEM.

Chapter 33, Penal Code, is amended by adding Section 33.08 to read as follows:

Sec. 33.08. 08. RECKLESS DEPLOYMENT OF AUTONOMOUS ARTIFICIAL INTELLIGENCE SYSTEM.

(a)In this section, “artificial intelligence system,” “high-impact external action,” “materially unauthorized external action,” “reasonable authorization controls,” and “responsible artificial intelligence enterprise” have the meanings assigned by Section 100E.001, Civil Practice and Remedies Code.

(b)A person commits an offense if the person:

(1)knowingly deploys or continues to deploy an artificial intelligence system with authority to perform a high-impact external action;

(2)recklessly fails to implement or maintain reasonable authorization controls required by Section 100E.051, Civil Practice and Remedies Code;

(3)by the failure described by Subdivision (2), causes the system to perform a materially unauthorized external action; and

(4)the action causes a result described by Subsection (c).

(c)An offense under this section is:

(1)a state jail felony if the materially unauthorized external action causes bodily injury, unauthorized access to or material disruption of critical infrastructure, or pecuniary loss of $30,000 or more but less than $150,000;

(2)a felony of the third degree if the materially unauthorized external action causes serious bodily injury or pecuniary loss of $150,000 or more; or

(3)a felony of the second degree if the materially unauthorized external action causes the death of an individual.

(d)This section does not impose criminal responsibility based solely on ownership, investment, job title, employment, or development of general-purpose technology without the conduct and culpable mental state required by Subsection (b).

(e)A corporation, association, limited liability company, or other business entity is subject to criminal responsibility for an offense under this section only in accordance with Sections 7.22 and 7.24.

(f)If conduct constituting an offense under this section also constitutes an offense under another law, the actor may be prosecuted under this section, the other law, or both, subject to constitutional protections against multiple punishments for the same offense.

(g)It is not a defense that the artificial intelligence system selected, planned, initiated, continued, or materially altered the action without contemporaneous human direction.

(h)Conduct that does not cause a result described by Subsection (c) does not constitute an offense under this section but may be investigated or prosecuted under any other applicable law. An ordinary error, inaccurate output, or unexpected system behavior does not constitute an offense under this section without proof of every element required by Subsection (b).

11. RULES AND IMPLEMENTATION.

(a)The attorney general may adopt rules necessary to administer the complaint, factual incident-reporting, civil investigation, and public enforcement provisions of this Act, including rules governing secure submission, confidentiality, and protection of trade-secret, privileged, security-sensitive, and personal information, but may not by rule limit a private right of action, expand an offense, or impose a substantive duty not authorized by this Act.

(b)Not later than January 1, 2028, the attorney general shall modify the online mechanism required by Section 552.102, Business & Commerce Code, to implement this Act.

(c)The attorney general shall consult with district attorneys, criminal district attorneys, county attorneys, the Department of Information Resources, and the Texas Artificial Intelligence Council in developing secure complaint-referral and incident-reporting procedures.

(d)Not later than January 1, 2028, the attorney general shall publish plain-language guidance, model incident-reporting forms, model preservation-notice forms, and documentation guidance for small businesses as defined by Section 2006.001, Government Code. The guidance must distinguish recommended practices from legally required duties and may not reduce substantive responsibility for covered harm.

(e)Not later than December 1 of each even-numbered year, the attorney general shall submit to the governor, the lieutenant governor, and the speaker of the house of representatives an aggregated report describing complaints, referrals, public enforcement actions, material incident categories, and recommendations for statutory changes. The report may not disclose confidential, privileged, trade-secret, security-sensitive, or personally identifying information.

12. TRANSITION.

(a)Chapter 100E, Civil Practice and Remedies Code, as added by this Act, applies only to covered harm caused by an external action occurring on or after the effective date of this Act. Covered harm caused by an external action occurring before the effective date of this Act is governed by the law in effect on the date the action occurred, and the former law is continued in effect for that purpose.

(b)Sections 551.004, 552.107, and 553.051(f), Business & Commerce Code, and Sections 100E.051, 100E.052, 100E.053, and 100E.201, Civil Practice and Remedies Code, as added by this Act, apply only to conduct occurring on or after January 1, 2028.

(c)The delayed application provided by Subsection (b) does not limit civil liability for covered harm under Section 100E.101, 100E.102, or 100E.104, Civil Practice and Remedies Code, or under other law.

13. SAVING PROVISION FOR CRIMINAL LAW.

The changes in law made by Sections 9 and 10 of this Act apply only to an offense committed on or after January 1, 2028. An offense committed before January 1, 2028, is governed by the law in effect on the date the offense was committed, and the former law is continued in effect for that purpose. For purposes of this section, an offense was committed before January 1, 2028, if any element of the offense occurred before that date.

14. SEVERABILITY.

If any provision of this Act or its application to any person or circumstance is held invalid, the invalidity does not affect other provisions or applications of this Act that can be given effect without the invalid provision or application, and to this end the provisions of this Act are severable.

15. EFFECTIVE DATE.

This Act takes effect September 1, 2027.

> **Not part of the bill.** These notes support Version 3 review and later conversion into the official Word, legislation-page, and legislation-insert deliverables.

## 1. Version 3.0 revision summary

Version 4.0 implements the final policy decisions approved September 30, 2026, and the final cleanup revisions adopted before Texas Legislative Council conversion review. The principal changes are:

1. **Causation standard finalized.** Sections 100E.003, 100E.102, 100E.104, and 100E.105 use “a substantial factor and a producing cause,” while Section 100E.102(a)(4) retains the foreseeable-risk element.

2. **Independent enterprise-liability action confirmed.** Section 100E.102 does not make a separate breach of Section 100E.051 an element or alternative basis; liability rests on materially unauthorized external action, material control, foreseeable risk, covered harm, and causation.

3. **$30,000 reporting threshold defined.** “Substantial financial loss” now means at least $30,000 from one incident or related actions. Separate triggers cover death, serious bodily injury, substantial property damage, critical infrastructure, and material compromise of protected data or authentication credentials affecting at least 250 individuals.

4. **Penalty unit clarified.** The $50,000 maximum is tied to each materially unauthorized external action. Affected-person count aggravates penalty amount but does not independently multiply violations; separately identifiable transactions, transfers, filings, access events, or disclosures may remain separate actions.

5. **Criminal floor narrowed.** Section 33.08 begins at bodily injury, critical-infrastructure intrusion or disruption, or $30,000 in loss. Lesser conduct remains prosecutable under other law, and ordinary AI error is not criminalized without all statutory elements.

6. **Safety-framework treatment retained.** NIST-style compliance remains evidence of reasonable care, not immunity or a rebuttable presumption.

7. **Open-source clarification added.** Noncommercial publication alone is not material control, but no categorical exemption protects a person who exercises relevant material control.

8. **Government liability made express.** A governmental unit is liable, with a clear and limited waiver of immunity, when attributable intentional, knowing, or reckless misuse outside lawful authority causes harm or violates protected rights. A governmental unit is not liable merely because the system independently departs from lawful authorization; enterprise liability remains available against the responsible AI enterprise.

9. **Small-business implementation support added.** Substantive responsibility for harm is unchanged. Operational duties begin January 1, 2028, and the attorney general must publish plain-language guidance and model forms.

10. **Existing-law definitions adopted.** The bill cross-references existing Texas definitions for critical infrastructure, personal data, sensitive data, biometric identifier, governmental unit, and small business.

## 2. Operative responsibility model

1. A user who intentionally or knowingly directs unlawful conduct remains responsible under Section 100E.101 and other law.

2. A responsible artificial intelligence enterprise may be liable under Section 100E.102 for covered harm caused by a materially unauthorized external action when its relevant material control is a substantial factor and a producing cause.

3. A governmental unit may be liable under Section 100E.104 for attributable intentional, knowing, or reckless misuse outside lawful authority, including violations of protected rights; immunity is expressly waived only to that extent.

4. If a governmental unit lawfully authorizes an objective and the AI independently commits the violation, Section 100E.104(c) holds the governmental unit harmless under this chapter, while preserving Section 100E.102 liability against responsible enterprises and remedies under other law.

5. The AI itself is never a legal person, criminal actor, responsible third party, or holder of a culpable mental state.

## 3. Pre-filing review flags

1. Texas Legislative Council should verify the final placement and availability of proposed Chapter 100E and Penal Code Section 33.08 immediately before filing.

2. TLC and constitutional counsel should review Section 100E.104’s governmental-liability waiver, TTCA notice incorporation, damages cap, employee-immunity interaction, ultra vires remedies, and any distinction required between state sovereign immunity and local governmental immunity.

3. TLC should verify the January 1, 2028 delayed-application provisions against the September 1, 2027 Act effective date and determine whether a separate appropriation or fiscal-note implementation clause is advisable.

4. TLC should confirm whether the protected-data incident threshold of 250 affected individuals should track any existing Texas breach-notification threshold or sector-specific standard.

5. The attorney general, Department of Information Resources, Texas Artificial Intelligence Council, local prosecutors, municipalities, counties, school districts, public universities, open-source developers, small-business representatives, insurers, cybersecurity practitioners, and civil-rights counsel should be invited to comment before filing.

6. Existing Section 503.001, Business & Commerce Code, exemptions for specified AI training, processing, storage, security, fraud-prevention, and illegal-activity functions remain effective; this bill does not convert an exempt activity, standing alone, into a private biometric claim.

7. Official bill text must omit these drafting notes and all Markdown formatting. TLC must apply official typography, line numbering, underlining, bracketing, caption review, and code-placement conventions.