5 Ways Autonomous Vehicles Will Change Law That You Might Not Expect

ALM Media

Mon, Mar 4, 2019, 7:53 PM

A Waymo-customized Chrysler Pacifica hybrid, used for Google's autonomous vehicle program, drives down 8th Street in San Francisco. (Photo: Jason Doiy/ALM)

Autonomous vehicles aren’t exactly a futuristic technology any longer. From San Francisco to Phoenix to Pittsburgh, these self-driving cars are already hitting the road in major U.S. cities, and experts estimate that 8 million autonomous vehicles will be sold in 2025, just six years away.

With this sea change imminent, it’s no surprise that law firms are responding. Dentons, for instance, has spun up an entire autonomous vehicles team in the past couple of years, with attorney focusing on different angles of the emerging practice ranging from regulatory issues to litigation concerns to privacy questions. The firm has even launched a blog to cover the ever-changing AV world on a weekly basis.

But of course, with any major change, there are bound to be ripple effects that even the most forward-thinking attorneys haven’t considered. Eric Tanenblatt, the global chairman of public policy and regulation at Dentons, recently sat down with Legaltech News to discuss the new AV paradigm. He explained just how wide-ranging change may be in the new autonomous vehicle-powered world with a number of ways the law may have to change.

1. Zoning Laws

For most people, private cars sit idle about 90 percent of the time. When autonomous vehicle fleets hit the road, though, an optimized system will have cars running at least three-quarters of the day, if not more. This means that car care will change for fleet owners. But there’s also a secondary consideration at play as well: what happens to all of those parking spots.

“What that means is that there won’t be the need for parking decks, parking garages and parking lots to the extent we have them now,” Tanenblatt said. “That frees up the space for more economic development or green space, that’s going to require local governments to change some of their zoning laws.”

He also noted that in some jurisdictions, there are laws on the books saying that when building a new commercial development, there needs a certain number of parking spaces. Those requirements would be superfluous in the new AV world, where instead, “there may be new requirements where you need to add drop off and pick up access, because there will be so many vehicles driving around.”

2. Bond Backing

From his firm’s public finance work, Tanenblatt has found that a lot of governments have bond indebtedness that is bonded with parking revenue. As an example, he noted that the city of Atlanta has bonds related to Hartsfield-Jackson Atlanta International Airport, where 40 percent of the airport’s revenue comes from parking.

But what happens when that revenue goes away, given the parking issues described above? “If 10 years from now we have autonomous fleets, and we don’t need all those parking spaces at the airport, they’re going to have to figure out how to plug that hole,” he explained.

This issue could become a long-term problem for some jurisdictions, even if a wide-ranging fleet of autonomous vehicles isn’t imminent. “In some cases, you have 30-year bonds that are backed by parking revenue and 10 years from now, they may drop off.”

3. Insurance Issues

Currently, 85 percent of accidents are a result of human error. And although it’s inevitable that some accidents will occur as a result of autonomous vehicle error, overall most experts believe that a majority of those human error accidents will be wiped out. Naturally, the implications for the insurance industry are enormous.

“When you take the human out of it, and you have these connected autonomous vehicles, it’s going to reduce automobile accidents, and you’re already seeing some of the large insurance companies predicting that insurance rates will drop,” Tanenblatt said.

It’s also notable who will need to hold insurance in the first place. Since many in the general population won’t own cars themselves, they will not need to buy insurance. Autonomous vehicle fleet owners, on the other hand, will be purchasing the majority of insurance policies, changing the way insurance carriers both market their services and assess risk.

4. The Federal/State Split

Historically, the federal government has taken the role of regulating cars, while states have regulated drivers through licenses and registration. “But in the case of autonomous vehicles, the cars are the drivers,” Tanenblatt noted. “So it’s a different animal than what we have been accustomed to in the past.”

Currently, there are a patchwork of state rules governing autonomous vehicles. Some legislatures have passed laws, while other state governors have issued executive orders, and some states simply have no rules on them at all. Federal rules proposed in the House of Representatives last year did not pass, and no further traction has been made on a federal level to solidify jurisdiction over this technology.

“It’s somewhat of a Wild West out there because every state is not passing the same laws as other states,” Tanenblatt said. “That’s why the federal government’s role is going to be so important.”

5. Integrating Younger Attorneys

Even within a firm’s own practice, autonomous vehicles can lead to change. At Dentons, the autonomous vehicle group touches a number of different practice areas and geographies simply because the tentacles of the new technology reach a number of different areas. “Whether it’s data privacy lawyers, whether it’s litigation lawyers, whether it’s our public policy and regulatory lawyers … it’s really across all regions and across all practice groups,” Tanenblatt explained.

That means opportunities for younger attorneys to get a foothold in this new area. Tanenblatt told the story of a younger attorney who joined the firm last summer who because of his interest in the subject and ability to “think digitally” was able to grasp some AV concepts easily and take on important work right away. It’s a function of being engaged with the subject matter, he said.

Tanenblatt added, “If they’re fortunate enough to work in an environment where they have a specialty like we do in the AV space, there’s great opportunity for them to get involved, no matter what aspect of the law or regulatory work they’re focused on.”