Brain Computer Interfaces Boot Up Multipronged Legal Issues

Meanwhile, lawmakers and regulators are beginning to respond: Several states have adopted explicit privacy protections for neural data, and in December, the US Food and Drug Administration approved the first prescription at-home brain stimulation device.

Neuralink Corp. grabbed the early headlines for its innovation in brain computer interfaces, or BCIs, but the field is now bustling with well-capitalized competitors across the globe. As BCI technology advances toward clinical reality, manufacturers, investors, healthcare institutions and their attorneys must navigate a dynamic and largely uncharted landscape of opportunity and risk.

Understanding BCIs

BCIs may be implantable or noninvasive. Implantable BCIs are surgically placed in, on or near the brain, and use electrodes to record neural activity, while noninvasive systems acquire signals externally, typically through sensors on the scalp.

In implantable systems, a small device within the skull may extend ultra-thin electrode threads into the brain’s cortex to detect neural activity. Those signals are transmitted to external devices, where software translates them into digital commands, enabling a person to control a computer, smartphone or prosthetic limb using thought alone. For patients who have lost motor function due to spinal cord injury or neurodegenerative disease, the clinical implications are profound.

BCIs exist on a broader spectrum of neurotechnology developing amid growing interest in preserving cognitive health and neurological resilience. At the noninvasive end, wearable neurostimulation devices are already reaching patients and consumers. Transcranial magnetic stimulation platforms have been used clinically for treatment-resistant depression for years, and the FDA authorized the first prescription at-home brain stimulation device — Flow Neuroscience’s FL-100 — in December 2025 for major depressive disorder.[1]

Electroencephalogram-based consumer headsets, closed-loop neurofeedback systems and ultrasound-based neuromodulation platforms occupy the middle of the spectrum. BCIs sit at the other end — the highest-resolution, most intensive category of intervention — where the most consequential legal and regulatory questions arise.

Participants in the Race

Neuralink remains the most visible player. Founded in 2016, the company received FDA approval to begin human trials in 2023 and has reportedly enrolled 21 trial participants — or “Neuralnauts” — as of this January.[2]

Its flagship device, the Link, is a coin-sized implant paired with a precision surgical robot designed to facilitate implantation. The current clinical trial, PRIME, is studying the device in patients with quadriplegia from cervical spinal cord injury or amyotrophic lateral sclerosis.

But the competitive landscape is expanding quickly.

Last October, Samsung announced that it is developing BCI-related technology, signaling that major consumer electronics companies see long-term commercial potential in neural interfaces.[3]

In February, Chinese research teams have announced additional progress involving implantable brain-computer devices, raising the prospect of an intensifying U.S.-China neurotechnology race with geopolitical ramifications.[4]

Former Neuralink personnel are launching well-funded startups, including Science Corp., which reportedly secured $230 million from venture capital firms in March.[5]

The pipeline of potential therapeutic applications is broad: paralysis, Parkinson’s disease, epilepsy, depression, dementia and potentially restoration of sight or hearing by bypassing damaged sensory pathways. Longer-term possibilities — such as cognitive enhancement or direct brain-to-brain communication — remain speculative but are already shaping investment strategies and policy discussions.

The Legal and Regulatory Picture

As is often the case with emerging technologies, legal, regulatory and ethical frameworks have not kept pace with the advancement of BCIs. Several areas warrant close attention.

Medical Device Regulation

BCIs are medical devices, subject to preclinical testing, investigational device exemptions and clinical trials before commercial launch. Neuralink’s FDA approval to begin human trials marked a significant milestone, but the path to market authorization remains lengthy and subject to ongoing agency oversight.

The FDA’s existing frameworks for implantable devices were developed largely with technologies like pacemakers and orthopedic hardware in mind — not adaptive, software-driven neural implants that may receive over-the-air firmware updates or incorporate machine learning-enabled functionality. This raises questions about how the agency will evaluate devices whose functionality can evolve after implantation.

As more companies enter the field, including foreign competitors, questions about international regulatory harmonization and competitive approval timelines will likely intensify. Divergent approaches across jurisdictions could prompt companies to pursue commercialization in regions perceived as more permissive, complicating cross-border compliance strategies.

Data Privacy and Governance

Neural interfaces collect raw signals that could reveal an individual’s cognitive state, motor intent, attention or emotional response — categories of information far more intimate than data contemplated by existing privacy laws.

Recognizing this sensitivity, several states, including California and Colorado, recently amended their privacy statutes to designate neural data as sensitive personal information triggering heightened compliance obligations.[6]

But these early legislative efforts raise as many questions as they answer.

What qualifies as “neural data” for legal purposes — raw electrical signals, processed outputs or inferences generated by artificial intelligence models? Can neural data ever be truly deidentified, or will it prove inherently identifiable like genomic data? Could government subpoenas or warrants compel production of recorded neural data in civil or criminal proceedings? And what happens if a BCI is compromised by malicious actors?

The consequences of unauthorized access to neural data could extend beyond the harms of typical data breaches into psychological manipulation and other impacts not currently contemplated by most privacy regimes.

As neurotechnology products reach the market, additional states will likely consider targeted neural data privacy legislation, and pressure may increase for Congress to adopt a nationwide floor for protecting such data.

Liability

A malfunctioning implant — one that causes injury, produces unintended neurological effects or fails to perform as represented — raises complex questions about responsibility among manufacturers, software developers, surgeons, hospitals and other stakeholders.

A single adverse event could involve a hardware defect, software bug, wireless transmission failure or surgical error, each attributable to a different party. Courts may need to determine how traditional product liability principles apply where no single actor controls the entire user experience.

Likewise, BCI technology may push the doctrine of informed consent into unfamiliar territory. Patients considering permanent implants face risks that may not fully emerge for years, particularly where software updates alter device functionality after implantation. How should informed consent laws address future firmware updates or AI-enabled functionality that does not yet exist at the time of implantation?

Against this backdrop, indemnification provisions, cybersecurity safeguards and robust insurance coverage will become increasingly important risk management tools.

Intellectual Property

BCIs may pose novel intellectual property issues. If a neural interface translates brain activity into creative work — such as music, visual art or software code — who owns the resulting output? The user whose neural activity generated the signal? The company whose algorithms interpreted it? Or the platform through which the output was rendered?

Existing copyright law generally requires human authorship, but the degree of human involvement in BCI-assisted outputs may vary significantly depending on the sophistication of the underlying technology. Patent law may face analogous questions: If a BCI-assisted researcher conceives of an invention while using a device that augments cognitive performance, could that affect inventorship analysis? These questions have no settled answers but may become important if BCIs move beyond therapeutic applications.

Ethics

Beyond these legal considerations, BCIs raise significant ethical questions: equitable access to expensive neurotechnology, the potential for coercive use, and the implications of technologies that could eventually influence or augment cognitive performance.

If BCIs ultimately evolve into tools for cognitive enhancement, the legal implications could spill over into employment, insurance, education and national security contexts.

For example, could an employer require BCI use as a condition of employment in high-stakes fields such as aviation or surgery? Could a government mandate neural monitoring for certain populations, such as convicted criminals? Although these scenarios remain speculative, the legal frameworks governing them warrant attention before the technology becomes widespread.

Why This Matters

BCI innovation will affect multiple industries and business functions.

Investors and acquirers evaluating neurotechnology companies must conduct due diligence regarding regulatory pathways, clinical trial risk, reimbursement considerations, cybersecurity practices and competitive dynamics across jurisdictions.

Healthcare institutions may face questions about adoption of BCI-based therapies, credentialing for novel implantation procedures, cybersecurity oversight, and their liability exposure relative to device manufacturers and software vendors.

Insurers will need to assess how to evaluate and price risks associated with implantable neurotechnology and procedures that lack long-term outcome data.

Employers may encounter accommodation requests, workforce privacy concerns and employment-law implications as neurotechnology matures and enters the workplace.

Attorneys across practice areas have a particularly important role.

Litigators should monitor how courts apply product liability and informed consent doctrines to implantable, software-enabled devices, as early disputes may establish foundational precedent.

Regulatory counsel advising medical device and digital health companies should track the FDA’s evolving approach to adaptive, AI-enabled neurotechnology and anticipate how post-market obligations may differ from those for traditional hardware.

Intellectual property practitioners should watch how courts and agencies respond to authorship, inventorship and ownership questions when neural interfaces contribute to creative or inventive processes.

Privacy counsel should analyze how neural data fits within existing privacy and cybersecurity frameworks and monitor new federal or state legislation specifically addressing neural data.

Transactional attorneys working on venture capital, licensing and M&A deals involving neurotechnology companies should develop competence in both the technical and regulatory dimensions of BCI technology to allocate risk appropriately.

Though in its infancy, the legal landscape surrounding BCIs is taking shape, as the pace of scientific and commercial progress speeds up. Attorneys who engage in this space now can shape the statutes, regulations and case law that will govern this technology for decades to come.

Originally published by Law360.

[1] https://www.reuters.com/business/healthcare-pharmaceuticals/us-fda-appr….

[2] https://neuralink.com/updates/two-years-of-telepathy/.

[3] https://news.samsung.com/global/samsungs-breakthrough-wearable-technolo….

[4] https://techcrunch.com/2026/02/22/chinas-brain-computer-interface-indus….

[5] https://techcrunch.com/2026/03/05/science-corp-closes-230m-round-as-it-….

[6] https://www.afslaw.com/perspectives/alerts/california-and-colorado-esta….

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