Sometimes truth is stranger than fiction.
The idea that the U.S. government should take equity interests in U.S. AI companies, such as OpenAI, Anthropic, Meta, Google, Microsoft, and others appears to be gaining momentum.
In two different approaches, the strange bedfellows Sen. Bernie Sanders and President Donald Trump floated the idea that the U.S. government would own equity interests in U.S. AI companies for the benefit of the American people. More on their respective ideas:
Sanders even has a bill that he will introduce in Congress, the American AI Sovereign Wealth Fund Act:
Vice President J.D. Vance recently defended the President’s idea for equity ownership of U.S. AI companies:
“The president is supportive of the United States owning these big AI companies. He likes the idea as sort of a sovereign wealth fund idea of the United States taking some stake in these AI companies.”
Vice President vance
According to Semafor, “Treasury Secretary Scott Bessent favored using equity in AI firms to seed Trump Accounts, while Commerce Secretary Howard Lutnick’s preference was that any equity be directed to a type of sovereign wealth fund.”
Does US equity interest in AI companies have a chance?
No one knows how much of a chance the idea of U.S. government equity ownership has. But the chances something like this occurs has to be non-zero. Probably few would have given the idea of a Strategic Bitcoin Reserve any chance just a few years ago. But the U.S. government established one.
President Trump has already orchestrated U.S. government equity interests in Intel, Nippon Steel’s acquisition of US Steel and the “critical mineral developers MP Materials, Lithium Americas, Vulcan Elements, Trilogy Metals and USA Rare Earth.” Plus, Trump had floated the idea the U.S. government would buy TikTok through a U.S. Sovereign Wealth Fund. That idea never came to fruition, but Trump did orchestrate the sale of TikTok from Chinese owners to U.S. owners. The U.S. government’s stake in Intel has appreciated in value by $50 billion in less than a year.
The idea of U.S. ownership of equity in AI companies is serious enough for the New York Times, Forbes, Financial Times, and other major media to report it. We will have to see how it plays out.
A Wildcard for the Copyright Lawsuits v. AI Cos.
Given that litigation takes a long time (potentially up to a decade if not more before final appeals are concluded), it’s not inconceivable that the U.S. government could, during Trump’s Administration, take equity interests in many of the U.S. AI companies being sued for copyright infringement in the more than 100 lawsuits now pending.
That’s certainly a wildcard scenario that no one could have imagined even just a few months ago. And, if it does happen, it will likely affect the copyright lawsuits in various ways — the full extent of which is too difficult to predict.
First, in the Northern District of California, the forum of the greatest number of these AI lawsuits (57 out of the 118 lawsuits are located in this district), the defendant AI companies would have to file supplemental Certifications of Interested Entities, designating the United States as an interested entity in the litigation. See Local Rule 3-15(b)(2). Not all jurisdictions follow this standard, and the Federal Rules of Civil Procedure require disclosure only of corporate interests, which presumably would not apply the U.S. government equity stake.
Second, even if a certification of U.S. government equity interest in the AI companies is not required by a jurisdiction, that government equity interest is likely to be known by the courts simply by media widely reporting this news. The AI companies could also cite the U.S. government’s interest in their briefs, which further adds to the public benefit from their AI programs, a key consideration under Factor 4 of fair use. The U.S. government could even intervene in the lawsuits as an amicus curiae or interested non-party and inform the courts of the U.S. government’s equity interest and legal positions.
But, even if none of this ever happens, that this idea is being seriously entertained by the U.S. government underscores a fact that should be apparent: the U.S. government already has a national interest in the success of U.S. AI companies.
As both Presidents Biden and Trump recognized in respective executive orders, the United States has a national interest in maintaining its global lead in AI development. An equity stake is unnecessary to recognize this basic fact.