Can Your Business Use AI-Generated People In Advertising?

It’s time to get your business’s marketing sorted. Instead of organizing a photo shoot, hiring a photographer, getting release forms signed and dealing with everything else that comes with creating new advertising content, you decide to use AI.

You’ve probably seen plenty of other businesses doing the same. AI-generated people can look remarkably realistic, and producing a campaign can be much faster and cheaper than organizing a traditional shoot.

So, why not?

Businesses can generally use AI-generated people in advertising, but AI-generated does not mean rights-free or legally risk-free.

Before an image goes live, you still need to consider copyright, the AI platform’s terms, whether a real person’s identity or likeness is involved, what claims the advertisement makes and whether customers are being given the wrong impression.

The US also requires a little extra caution because some important protections — particularly rights relating to a person’s name, image, likeness or voice — differ from state to state.

What Counts As An AI-Generated Person?

An AI-generated person can mean several different things.

You might enter a prompt and create a completely fictional person who was not intentionally based on anyone real.

You might instead upload an existing photograph and ask the AI tool to change the person’s clothing, location, age or appearance.

Or you might deliberately create a digital version of an identifiable celebrity, customer, employee, influencer or other real person.

These situations carry different levels of risk.

The closer your generated image gets to a real person or existing creative work, the more important it becomes to ask whether you actually have the right to use it.

Does AI-Generated Mean Copyright-Free?

No. An AI-generated image is not automatically free from copyright issues.

If your business uploads an existing photograph, illustration or other work to an AI tool, first ask who owns it and what your existing license allows.

Permission to use a photograph in one campaign does not necessarily mean you have unlimited permission to feed it into an AI platform, alter it and build new advertising assets from it.

The finished output also matters.

An AI-generated image may create infringement issues if it reproduces protected expression from an existing work closely enough.

The US Copyright Office’s AI initiative has been examining both the use of copyrighted works in AI training and the copyright implications of AI-generated outputs.

For most businesses, the practical checks remain: what did you upload, did you have the necessary rights, what does the provider permit and what does the final image actually look like?

Can Your Business Copyright The AI-Generated Image?

The US takes a relatively clear position on the importance of human authorship.

Purely AI-generated material without sufficient human authorship is not protected by US copyright.

In January 2025, the US Copyright Office’s report on AI copyrightability confirmed that generative AI outputs can be protected where a human author has determined sufficient expressive elements. Human-authored selection, arrangement or modification may qualify, but merely providing prompts is generally not enough by itself.

Using AI as part of a human creative process does not automatically prevent copyright protection.

So, if your team uses AI to create a rough image and then substantially edits, arranges or adds human-created material, those human contributions may still be protectable.

The practical point is important for advertising.

If you create a distinctive AI character that becomes central to your brand, do not automatically assume copyright will stop competitors from generating something similar.

Keep records of your team’s creative contribution and consider other forms of brand and contractual protection where the asset is commercially important.

What Do The AI Tool’s Terms Let You Do?

Before publishing an AI-generated person commercially, check the platform’s terms.

Look at:

• commercial-use rights
• ownership and licensing of outputs
• rights over uploaded photographs
• restrictions around real people or public figures
• whether inputs are retained or used for training
• indemnities and IP protections
• responsibility for third-party claims.

Permission from an AI provider to commercially use an output does not necessarily mean the provider guarantees that nobody else’s copyright, privacy or publicity rights are implicated.

If your business will be relying heavily on a particular provider, a Business Contract Review can help identify what the agreement actually does and does not protect you from.

If staff are using AI across marketing and other business functions, an AI Acceptable Use Policy can also set internal rules around approved systems, inputs, review and publishing.

What If The AI Person Is Based On Someone Real?

This is where US businesses need to be especially careful.

The United States does not have one uniform federal right that gives every person exactly the same control over their image or likeness.

Instead, many states recognize rights of publicity through legislation, common law or both. These rights can restrict unauthorized commercial use of a person’s name, image, likeness, voice or other identifying features, but the scope and available remedies can differ significantly between states.

The US Copyright Office’s report on digital replicas discusses the existing state-law framework and the additional challenges created by realistic AI-generated replicas.

Some states have also updated their laws in response to AI-generated voices, images and digital replicas. This means the legal position can depend on both who is being recreated and which state’s law applies.

At the federal level, the US Copyright Office concluded that existing protections leave gaps around unauthorized digital replicas and recommended federal legislation addressing realistic replicas of individuals. Federal proposals have continued to develop, but there is not currently one nationwide digital-replica law replacing the existing state-by-state framework.

For a business, you do not need to become an expert on every state’s digital-replica laws before creating an ordinary fictional model.

The practical distinction is simpler: if you are intentionally recreating or closely imitating a real person for commercial advertising, get permission and check the law that applies to that use.

A Talent Release Form can put image, voice, likeness and commercial-use permissions in writing before content is created.

Privacy laws can create additional issues depending on what information your business collects and the states involved. US privacy regulation is increasingly state-specific, so businesses handling customer or user information should make sure their privacy documentation reflects their actual practices. Sprintlaw’s Data & Privacy services cover privacy policies and state-specific privacy requirements.

Can An AI-Generated Person Give A Testimonial Or Endorse A Product?

AI avatars can appear in marketing. The problem is using them to fabricate a testimonial or endorsement.

The FTC has specifically addressed this issue.

Its Consumer Reviews and Testimonials Rule guidance says there is no blanket prohibition on using AI-generated stock avatars or virtual influencers in marketing.

However, an AI avatar can still create a prohibited or deceptive testimonial where the underlying experience or endorsement is fake. The FTC also gives the example of using a celebrity avatar without permission to speak positively about a product where reasonable consumers would think the celebrity actually gave the testimonial.

So, an AI presenter saying:

“Our backpack comes in four sizes.”

is very different from an AI-generated “customer” saying:

“I’ve traveled with this backpack for two years and I’ll never use another brand.”

if that customer never existed.

The FTC’s Endorsement Guides also require endorsements to be truthful and not misleading. An endorser should not describe an experience with a product they have not actually had.

The solution is straightforward: use AI to present real facts. Do not use it to manufacture fake experience, expertise or endorsement.

Can The AI Image Misrepresent Your Product?

Yes. Truth-in-advertising rules can apply to the overall message of an advertisement, including its visuals.

An AI image might:

• make clothing appear to fit better than the actual product
• exaggerate cosmetic results
• create an artificial before-and-after image
• show a product performing in a way it cannot
• depict a customer result that is not supported by evidence.

The FTC’s advertising and marketing guidance explains that advertising claims must be truthful, cannot be deceptive or unfair and should be supported by evidence where substantiation is required.

So, before publishing, compare the AI creative with what you actually sell.

If the AI has invented a better version of your product, fix the creative instead of expecting a disclaimer to do the work.

Do You Have To Disclose That The Person Is AI-Generated?

There is currently no single federal rule requiring every ordinary AI-generated advertising image in the US to carry an “AI-generated” label.

Instead, businesses need to look at the nature of the content, the overall impression of the advertisement and any federal or state rules that apply to that particular use.

FTC rules remain focused on whether advertising is deceptive and whether endorsements and testimonials are truthful.

That means an AI label is not necessarily required simply because a fictional model appears in a routine advertisement.

However, where the synthetic nature of the content affects how consumers interpret an endorsement or claim, disclosure may become much more important.

State laws can also introduce additional requirements in particular contexts, including certain uses of digital replicas.

Most importantly, disclosure does not create permission.

Writing “AI-generated” beneath an image does not:

• give you copyright rights in somebody else’s photograph
• give you permission to recreate a celebrity or other real person
• override somebody’s applicable publicity or likeness rights
• turn a fictional testimonial into a genuine one
• make an unsupported product claim true.

Disclosure can help with transparency, but it does not give your business rights or permissions it did not already have.

What If Your Advertising Is Seen Overseas?

US businesses advertising internationally should not assume US rules are the only ones that matter.

The same campaign may be subject to different AI, advertising, privacy or likeness rules when it reaches customers in another market.

For example, Article 50 transparency requirements under the European Union’s AI Act began applying on 2 August 2026.

They include requirements around machine-readable marking of certain AI-generated or manipulated content, as well as disclosure where AI is used to create or manipulate content that constitutes a deepfake.

This does not mean every AI-generated advertising image used in Europe simply needs the same visible “AI-generated” label. The requirements depend on the type of content and the role of the business or AI provider.

The European Commission’s Article 50 guidance explains the requirements in more detail.

So, a campaign that works for US audiences may need additional transparency or other changes before it is used in European or other international markets.

What Should You Check Before Using An AI Person In An Ad?

Before publishing, ask:

• Is this person completely fictional?
• Could customers reasonably identify them as someone real?
• Did we upload an existing photograph or protected work?
• Do we have the rights needed to modify it?
• If a real person is involved, do we have written commercial-use permission?
• Which state’s publicity, likeness or privacy laws could apply?
• Does the AI provider permit this commercial use?
• Could the output reproduce someone else’s protected work?
• Is there enough human authorship for the asset to receive copyright protection?
• Is the AI character being presented as a real customer, expert or endorser?
• Are all claims and results supportable?
• Would disclosure change how consumers interpret the advertisement?
• Will the campaign run in countries with additional AI rules?

You do not necessarily need legal help every time you generate a fictional person for a social post.

But the risk changes once you start recreating real people, using third-party creative content, building valuable brand assets around AI-generated material or running the same campaign across several states or countries.

In those situations, getting the permissions and legal position clear before launch is usually much easier than trying to fix the campaign after somebody objects.

If you would like a consultation on using AI generating people in your business’s advertising, you can reach us at (888) 449-8437 or team@sprintlaw.com for a free, no-obligations chat.