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type: incident · created: 2026-10-27 · updated: 2026-10-27 · tags: [incident, legal-services] · confidence: high · severity: low · affected_sectors: [legal-services] · au_impact: true

Texas sued OpenAI and its chief executive Sam Altman on 23 October under the state's deceptive trade practices laws, alleging that the company markets ChatGPT as safe while its safeguards fail to protect consumers, including children. The suit seeks civil penalties of up to $10,000 per violation and injunctive relief that would bar minors from accessing ChatGPT, require third-party approval of new models by a court-appointed expert, and prohibit the chatbot from advising users on suicide, eating disorders or violence. Unusually, the attorney general is seeking to hold Altman personally liable for the alleged deception. The filing quotes Altman's past statement that AI will "probably most likely lead to the end of the world, but in the meantime, there'll be great companies", and cites OpenAI's valuation growth from about $17 billion to over $1.4 trillion in four years while asserting that "the rise of OpenAI is attributable to a web of deceit". OpenAI said it works with experts to improve safeguards and supports robust but industry-wide safety standards. The action is the first US state consumer-protection suit to target an AI vendor's safety marketing rather than its data practices.

Attribute Detail
Sector Legal Services
Date 2026-10-27
Source The Record
Reliability Tier 2