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Lawsuit: OpenAI Accused of Deceiving Texas Consumers, Breaking State Law

Daily Legal Briefing by Daily Legal Briefing
October 26, 2026
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Lawsuit: OpenAI Accused of Deceiving Texas Consumers, Breaking State Law
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“With the rapid advancement of AI technology, OpenAI has the responsibility to protect users and warn them of the many dangers of its platform,” said Paxton. “I will fight to protect Texans from the harms of AI and ensure that powerful technology companies are not above the law.” 


Texas Attorney General Ken Paxton has filed a lawsuit accusing OpenAI of violating state law by deceiving consumers about the safety of its best-known product, ChatGPT.

Filed Friday in a Collin County district court, the lawsuit opens with a quote attributed to OpenAI founder Sam Altman. “AI,” Altman said, “will probably most likely lead to the end of the world, but in the meantime, there’ll be great companies.”

“Despite these incredible dangers, Altman and OpenAI have not only barreled ahead in creating these risks but have done so by unlawfully deceiving Texans about the safety, accuracy, and reliability of their products,” the lawsuit says. “Altman and OpenAI have failed to warn Texans of the dangers of their product, in violation of the Texas Deceptive Trade Practices-Consumer Protection Act, and … the Securing Children Online through Parental Empowerment Act.”

Paxton broadly claims that OpenAI has failed to put sufficient safeguards on the development of ChatGPT, leading to a number of dangerous outcomes for Texas residents.”

A gavel. Image via Wikimedia Commons via Flickr/user: Brian Turner. (CCA-BY-2.0).

“Without adequate safeguards, LLMs can output inaccurate or harmful information, without this risk being disclosed to users. Numerous reports highlight the dangers of human reliance on undertrained and rogue AI chatbot technology,” Paxton’s office said in a statement. “Mass shooters have been aided and abetted in deadly rampages, vulnerable people have been encouraged into suicide, professionals have suffered public humiliation, users have lost critical thinking skills, and minors have become addicted to a tool that fakes human compassion to collect their data with no parental oversight. This litany of harms is driven by the company’s insatiable quest to win the AI arms race and amass large fortunes, despite knowing the dangers of ChatGPT.”

Paxton indicated that companies like OpenAI should have a responsibility to protect the public from harm.

“With the rapid advancement of AI technology, OpenAI has the responsibility to protect users and warn them of the many dangers of its platform,” said Paxton. “I will fight to protect Texans from the harms of AI and ensure that powerful technology companies are not above the law.”

A spokesperson for OpenAI insisted that their product is safe and that its development is guided by expert insight.

“Governments have an important role to play in setting robust safety standards for AI, and we’re committed to working with Texas and other states on advancing pragmatic AI policies that apply to the entire AI industry—not just one company,” an OpenAI spokesperson said in a statement.

Sources

Attor­ney Gen­er­al Ken Pax­ton Sues Ope­nAI and CEO Sam Alt­man for Lying to Users and Harm­ing Texans

Texas Attorney General Ken Paxton sues ChatGPT-maker OpenAI



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