Did AI Touch Your Ad? Pennsylvania May Require You to Say So

Consider a cookware company that uses a generative artificial intelligence (AI) tool to create a video showing its pan effortlessly releasing a burnt-on meal, when the actual product does not perform that way. Beginning on December 21, 2026, if that advertisement does not disclose the use of AI, that company could face civil penalties, even if it never intended to mislead anyone. Pennsylvania's new Artificial Intelligence Deceptive Advertising Act (the Act), signed by Gov. Josh Shapiro on October 22, 2026, empowers the Pennsylvania Attorney General (AG) or appropriate district attorney to bring an enforcement action against advertisers without warning or opportunity to cure and gives advertisers only two months to comply.¹

The new law requires a "clear and conspicuous disclosure" on advertisements that use "synthetic content" – media that is significantly modified or generated by AI – "in a manner that creates a false consumer perception about the nature, origin or authenticity of the goods or services being advertised."²

The Act's passage comes amid a recent push among states to regulate the use of rapidly developing AI technology, particularly in the consumer products space. Other states such as New York have enacted more targeted AI advertising measures directed toward specific industries of interest that may not be regulated by existing consumer protection law such as the use of synthetic performers in advertisements.³

Pennsylvania's Act is more aggressive and far more expansive; it does not target a specific industry or practice and instead applies to all advertisers. Additionally, Pennsylvania, similar to other states, already has robust consumer protection laws aimed at curbing false advertising.⁴ The Act therefore purports to give enforcement authorities an additional tool to specifically target AI use.

This Holland & Knight alert summarizes the Act's requirements, enforcement mechanisms and the open questions advertisers should consider.

The Act's Requirements

The Act requires that advertisers who "create and disseminate or cause to be created and disseminated an advertisement" that uses content significantly modified or generated by AI (synthetic content) include a disclosure when the synthetic content is used in a way that depicts the product in a false manner.⁵ Following federal statutes, the Act defines AI broadly as a machine-based system that can make predictions, recommendations or decisions influencing real or virtual environments for human-defined objectives, and it expressly includes generative AI.⁶ In practice, this definition reaches the tools advertisers would use to create or alter images, video and voice.

The Act does not specify what creates a "false consumer perception about the nature, origin or authenticity of the goods or services being advertised." To comply with the Act, an advertiser must therefore individually assess whether there is a risk that the advertisement creates a false perception and thus warrants inclusion of an AI-use disclosure. Because the Act does not specify who an advertiser is, that obligation may also extend to platforms or publishers of these advertisements.

The disclosure must state that "the advertisement contains content that was modified or generated using AI," and the disclosure must be:

• displayed "in the first instance" whenever the synthetic content is presented to the consumer
• presented in the same medium as the synthetic content
• to the extent technically feasible, permanent or extraordinarily difficult to remove from the synthetic content⁷

The disclosure must also be "clear and conspicuous." The Act contains detailed standards, similar to Federal Trade Commission (FTC) disclosure guidance, on what constitutes a clear and conspicuous disclosure.⁸ A disclosure:

• must be "in a size, color, contrast, location, duration and audibility that is readily noticeable, readable, and understandable and capable of being heard"
• must be "in the language or other interaction used by the consumer to interact with or comprehend the synthetic content"
• must not contradict or be inconsistent with other information in the advertisement
• must be placed near the content it explains, if the disclosure modifies, explains or clarifies "other information with which the statement or disclosure is presented"⁹

Specifically, audio disclosures must be "delivered in a volume and cadence sufficient for a consumer to hear and comprehend," visual disclosures must be "of a size and shade and appear[] on the screen for a duration sufficient for a consumer to read and comprehend the statement or disclosure," and print advertisements must contain a disclosure that is "in a type size and location sufficiently noticeable for a consumer to read and comprehend the statement or disclosure in a print that contrasts with the background against which the statement or disclosure appears."¹⁰ In other words, fine print on a print advertisement, TV spot or rushed voiceover at the end of a radio advertisement will not suffice.

Exceptions to Disclosure Requirements

The Act carves out three exceptions to the disclosure requirement, including for content that is 1) evidently fictional based on its content or context, 2) parody, satire, commentary or criticism, or 3) limited to text.¹¹ The Act does not define what constitutes content that is "evidently fictional."

An advertisement that is otherwise construed as false or misleading remains subject to Pennsylvania's existing consumer protection laws, even if it carries an AI disclosure. For instance, Pennsylvania's Unfair Trade Practices and Consumer Protection Law (UTPCPL) prohibits "unfair or deceptive acts or practices in the conduct of any trade or commerce," including, among others, "[r]epresenting that goods or services have sponsorship, approval, characteristics, ingredients, uses, benefits or quantities that they do not have."¹² The UTPCPL gives aggrieved individuals a private right of action to recover damages against the advertiser.¹³ Making the required disclosure is not a defense to any other recourse permitted under the law.¹⁴

Enforcement and Penalties

The Act is enforced exclusively by the Pennsylvania AG or "appropriate district attorney" acting in the name of the Commonwealth. Unlike the UTPCPL, there is no private right of action. When an enforcer has reason to believe that a person is using or is about to use a prohibited practice, it may seek a temporary or permanent injunction. Enforcers may also bring a civil action, and a court may award a civil fine of up to $3,000 and actual attorneys' fees and court costs. The Act leaves open how damages are calculated – whether a one-time penalty, levied on a per-violation basis or some other accrued penalty – apparently providing enforcers with discretion on how to calculate the penalty depending on the violation.¹⁵

Notably, the Act includes no intent provision. Though initial drafts of the bill required that the advertiser "knowingly, recklessly, or willfully" violate the Act's provisions, the intent language was stricken from the final version.¹⁶ Thus, any violation subjects the advertiser to possible enforcement action. And unlike some federal regimes, the Act includes no warning letter, audit or cure process before enforcement.

Open Questions

As suggested above, the Act's ambiguous language raises several important questions about implementation that can profoundly affect how the Act is enforced going forward.

What Is Considered an Advertisement That Creates a "False Consumer Perception"?"

The Act does not define a "false consumer perception." The text is not clear whether any advertisement that uses synthetic content to depict a product would be considered creating a false perception and would require disclosure.

What Does It Mean That the Information Has Been "Significantly Modified"?"

The Act similarly does not define when content is considered "significantly modified" by AI. Many advertisers have been using graphic design programs to enhance images, audio and video.

Who Is an "Advertiser"?"

The term is undefined, and the "cause to be created and disseminated" language could reach others involved in preparing and publishing an advertisement directed to consumers.

How Are Civil Penalties Calculated?

The Act caps a civil fine at $3,000 but does not say whether that is per advertisement, per airing/publication or even per day. An advertisement that runs for a month could potentially be treated as 31 separate violations.

Recommendations and Next Steps

• Consider adding AI disclosures to advertising material created using AI.
• Consider augmenting existing advertising content approval checklists or review protocols to account for concerns related to AI-created advertising materials.
• Pay close attention to how the AG, district attorneys and courts interpret and enforce the Act.
• Remember that a disclosure in an advertisement is not a defense to other claims that may be brought.

With the rapid evolution of AI technology and increased scrutiny it is facing from the public and elected officials, Pennsylvania's new law may touch off a cascade of new regulation across states. Holland & Knight's Consumer Protection Defense and Compliance Team, Marketing, Advertising and Sweepstakes Team, and Artificial Intelligence Team are available to help businesses assess their advertising practices and prepare for the Act's effective date. For more information, please contact the authors.

Notes

¹ Senate Bill (SB) 806, also now referred to as Act No. 2026-99.

² SB 806, Section 4(a).

³ New York's law, which took effect on June 9, 2026, requires advertisers to disclose if an advertisement uses AI-generated synthetic performers. SB 8420-A (New York) (2025) / Assembly Bill (AB) 8887-B (New York) (2025).

⁴ Pennsylvania Unfair Trade Practices and Consumer Protection law (UTPCPL), 73 P.S. Section 201-1 – 201-9.2. Section 201-2(4)(xxi), for instance, defines "unfair methods of competition" as, in part, "[e]ngaging in any other fraudulent or deceptive conduct which creates a likelihood of confusion or of misunderstanding."

⁵ SB 806, Section 4(a).

⁶ SB 806, Section 3 ("artificial intelligence").

⁷ SB 806, Section 4(a).

⁸ See, e.g., 16 C.F.R. Section 255.0 (defining a "clear and conspicuous" disclosure for the use of endorsements and testimonials in advertising).

⁹ SB 806, Section 3 ("clear and conspicuous").

¹⁰ Id.

¹¹ SB 806, Section 4(b).

¹² UTPCPL, 73 P.S. Section 201-2(4)(v), 201-3(a).

¹³ UTPCPL, 73 P.S. Section 201-9.2.

¹⁴ SB 806, Section 4(c).

¹⁵ SB 806, Section 5.

¹⁶ SB 806, Section 4(a).

Information contained in this alert is for the general education and knowledge of our readers. It is not designed to be, and should not be used as, the sole source of information when analyzing and resolving a legal problem, and it should not be substituted for legal advice, which relies on a specific factual analysis. Moreover, the laws of each jurisdiction are different and are constantly changing. This information is not intended to create, and receipt of it does not constitute, an attorney-client relationship. If you have specific questions regarding a particular fact situation, we urge you to consult the authors of this publication, your Holland & Knight representative or other competent legal counsel.