Companies must make consequential decisions without knowing what the rules are or will be.
Every time a research team designs an artificial intelligence drug-discovery workflow, it’s betting on how courts will define “inventorship.” And when companies rely on shared analytics platforms, they’re assuming something about where the Justice Department draws antitrust lines.
The legal pressures forcing these kinds of bets are pervasive. At Goodwin, we see them across industries and deal types, from life sciences and private equity to technology. We call them forces of law — legal dynamics affecting how businesses compete, invest, and plan—and we’ve identified areas where the stakes are especially high.
Forces at Work
Companies that recognize the following implicit bets can design for flexibility—and avoid getting locked into unfavorable positions.
AI drug patents. Pharmaceutical economics depends on exclusivity, and patents require human inventors. But when an AI system generates a novel molecular structure, who conceived it? Courts haven’t decided. Companies designing AI workflows are betting that documented human contributions will satisfy whatever standard emerges. More than 500 FDA submissions from 2016 to 2023 included AI components, and the AI drug discovery market is projected to reach $13.4 billion by 2035. Companies are already operating without knowing if their inventions can be protected.
Cybersecurity standards. AI has transformed the economics of cyberattacks, enabling virtually anyone to craft convincing phishing messages, generate deepfakes, and develop adaptive malware. Quantum computing threatens to break current encryption entirely. Companies are betting their security investments will satisfy whatever standard of “adequate” emerges as the threat landscape evolves. Some threats blur the line between cybersecurity and national security: North Korean operatives have infiltrated Western companies by posing as remote developers, using AI to fabricate identities. Companies that unknowingly employ them face sanctions exposure, raising the question of whether traditional hiring processes can ever be “adequate” when AI makes deception nearly undetectable.
Algorithmic coordination. Companies selecting analytics vendors are betting on where courts draw the line between legitimate intelligence and prohibited coordination. DOJ sued property managers using shared pricing software, alleging rent coordination. Yet courts dismissed similar cases against hotel operators, suggesting courts still want evidence of explicit agreement. Industries with concentrated analytic infrastructures (financial services, telecommunications, health care) operate under theories that could expand from housing precedents, but judicial boundaries remain unclear.
Medicaid funding cuts. Medicaid cuts passed by Congress will reduce federal spending by roughly $700 billion over the next decade. Health-care providers are betting on whether states will implement reductions through eligibility restrictions, payment cuts, or other approaches. Life sciences companies will see addressable markets shrink as more than 37 million children and millions of long-term care patients lose coverage. Companies must decide whether to restructure service lines, shift their payer mix, or exit Medicaid-dependent markets, and each choice embeds assumptions about state-level responses that won’t be clear for months.
AI talent competition. A small number of individuals have frontier AI expertise—and their scarcity, combined with their freedom to move, is reshaping how companies hire, invest, and structure deals. Large technology companies are acquiring teams from startups and other companies. Investors are rewriting term sheets and reconsidering governance mechanisms to address the impact of sudden departures. Companies are redesigning compensation with extended vesting, performance triggers, and revesting provisions to retain and motivate key people. The bet: These untested mechanisms will preserve alignment and enterprise value in a legal environment that lets top talent walk away when they choose.
Private markets in retirement plans. Governments worldwide are opening private markets to ordinary investors. The biggest test is in the US, where a 2025 executive order directed agencies to clarify how private assets can be included in defined contribution plans. Asset managers are betting that small private allocations embedded in target-date funds can satisfy ERISA’s fiduciary standards. Policy is moving, platforms are choosing, and courts will judge later. That timing mismatch is the bet: Move early and risk litigation if the rules tighten; wait for clarity and miss scarce distribution shelf space.
Mass arbitration. Consumer arbitration agreements once offered predictable dispute resolution, but technology changed the equation. Plaintiffs’ firms now use targeted ads and AI-generated filings to assemble thousands of identical claims overnight. Companies face administrative fees reaching millions before any merits hearing. The AAA revised its rules in 2024 to address mass filings, but their effectiveness remains untested. Companies are betting that amended arbitration agreements (adding bellwether procedures, evidentiary preconditions, affirmation requirements) will withstand judicial scrutiny.
Delaware governance. Companies leaving Delaware for Texas and Nevada are betting that governance flexibility outweighs commercial uncertainty. Companies staying in Delaware are betting that established commercial law precedent matters more than management-friendly fiduciary standards. Delaware has a century of precedent on contract disputes and M&A disagreements. Delaware has dozens of cases interpreting “efforts” clauses; Nevada has none. Delaware’s fraud precedent is clear; Texas has one case suggesting parties can disclaim liability for fraudulent inducement.
Presidential authority. The Supreme Court is considering cases that could reset the balance between presidential power and agency independence. In Learning Resources, Inc. v. Trump, the court will decide whether the president can impose sweeping tariffs under emergency powers. In Trump v. Slaughter, the court may overrule Humphrey’s Executor, the 1935 precedent limiting the president’s power to fire heads of independent agencies. If it falls, agencies such as the Securities and Exchange Commission, Federal Communications Commission, and Commodity Futures Trading Commission will face more partisan pressure and dramatic policy swings between administrations. For companies, strategic planning depends on outcomes that won’t be known until late June.
None of these dynamics will resolve quickly. But companies don’t need certainty to act wisely. They need to see the bets they’re already making and build structures that are flexible enough to absorb more than one outcome.
To navigate such pressure points, leaders must explore the forces of law shaping competition, investment, and long-term planning to help future-proof their decisions before the rules fully settle.
This article does not necessarily reflect the opinion of Bloomberg Industry Group, Inc., the publisher of Bloomberg Law, Bloomberg Tax, and Bloomberg Government, or its owners.
Author Information
Anthony McCusker is chair of Goodwin, a global law firm.
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