Alert

EO Seeks to Preempt Patchwork of State AI Laws with “Minimally Burdensome” National Framework

December 15, 2025

A new Executive Order signed on December 11, 2025 outlines the Administration’s attempt to establish a unified national policy approach for artificial intelligence (AI). The order’s overarching objective is to prevent a fragmented patchwork of state AI laws that could inhibit AI development in the U.S., and instead replace them with a “minimally burdensome national policy framework.”

Key measures in this order include:

• Creation of an AI Litigation Task Force: Within 30 days, a new AI Litigation Task Force will be created by the Attorney General to challenge state AI laws that: conflict with the “minimally burdensome national policy framework;” unconstitutionally regulate interstate commerce; or are preempted by existing Federal law.
• Federal Report on Onerous State AI Laws: Within 90 days, the Secretary of Commerce must publish a report identifying “onerous” state AI laws that conflict with the “minimally burdensome national policy framework” and that should be referred to the AI Litigation Task Force for potential action. The report must identify laws that “require AI models to alter their truthful outputs” or compel disclosure of information in a manner that would violate the Constitution. At the same time, this report may also identify laws that promote AI innovation consistent with the Administration’s framework.
• Policy on State Ineligibility for Federal Funds: Within 90 days, the Secretary of Commerce must issue a policy notice describing when states with “onerous AI laws” might become ineligible for remaining funds from the Broadband Equity Access and Development program.
• Executive Agency Grant-Making Conditions: Executive departments and agencies are instructed to examine all their discretionary grant programs to determine whether grants may be conditioned on states either not enacting onerous AI laws or, if onerous AI laws exist, their entering into binding non-enforcement agreements.
• Possible FCC Reporting and Disclosure Standard: Within 90 days, the Federal Communications Commission (FCC) is required to determine whether to adopt a “Federal reporting and disclosure standard for AI models that preempts conflicting state laws.”
• FTC to issue guidance on UDAPs in AI: Within 90 days, the Federal Trade Commission (FTC) is required to issue a policy statement on the application of the prohibition of unfair and deceptive acts or practices (UDAPs) to AI models. This includes addressing when “State laws that require alternations to the truthful outputs of AI models are preempted” by the FTC Act’s prohibition on deceptive acts or practices.
• Legislative recommendations: The Special Advisor for AI and Crypto and the Assistant to the President for Science and Technology are required to prepare legislative recommendations to establish a “uniform Federal policy framework for AI that preempts State AI laws” that conflict with the “minimally burdensome national policy framework.”

The Executive Order has already drawn sharp responses from state leaders, including criticism from California officials who argue it undermines consumer protections, and assertions from governors, including Florida’s, that an executive order cannot override state legislative authority. With state rules still operative but potentially facing federal challenge, significant uncertainty remains around how states will respond.

Legal challenges to state AI laws will likely increase substantially with this executive order, and companies using AI will continue to face uncertainty in the near term as the enforceability of current and future state requirements are challenged. While federal agencies, including the FCC and FTC, may advance rules intended to assert federal preemption over state AI laws, expect states to contest those actions on procedural and constitutional grounds. The ultimate shape of a nationwide AI policy framework will depend not only on litigation outcomes but also whether Federal legislative proposals can garner bipartisan support.

While this Executive Order aims to replace a growing mix of state AI requirements with a unified federal framework that the Administration describes as “minimally burdensome,” states are already signaling that litigation and legal battles may be ahead. If you or your company has any questions about how these changes may affect your organization, please reach out to McGlinchey.