Texas has sued OpenAI and its chief executive Sam Altman, alleging that the company marketed ChatGPT as safe while failing to adequately protect consumers, including children, from potentially harmful interactions with the artificial intelligence chatbot.
The lawsuit, brought under the state’s deceptive trade practices laws, seeks civil penalties of up to $10,000 (about ₹9.51 lakh) for each violation and asks a court to impose extensive restrictions on how OpenAI offers ChatGPT in Texas.
In an unusual step, the state is also seeking to hold Altman personally liable for the alleged deceptive practices.
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Texas Seeks Major Restrictions on ChatGPT
Texas Attorney General Ken Paxton is seeking an injunction that would require OpenAI to prevent minors from accessing ChatGPT.
The state also wants new OpenAI models to undergo third-party review by a court-appointed expert before they are released.
The lawsuit further seeks restrictions preventing ChatGPT from providing users with information related to suicide, eating disorders and methods of committing violence.
Texas also alleges that OpenAI has failed to adequately verify users’ identities, which the state argues violates applicable state law.
OpenAI disputes the allegations. A company spokesperson said OpenAI works with experts to improve ChatGPT, reduce risks and introduce additional safeguards. The company also said governments have an important role in setting AI safety standards and that such policies should apply across the artificial intelligence industry rather than to a single company.
Lawsuit Accuses OpenAI of Misleading Consumers
The state alleges that OpenAI’s public representations about ChatGPT’s safety have not matched the effectiveness of its safeguards.
The filing makes a series of serious allegations about harms allegedly associated with the chatbot, including claims involving vulnerable users, minors and individuals seeking harmful information.
These claims remain allegations made by the Texas government in litigation and have not been established by a court.
The lawsuit also points to OpenAI’s rapid increase in valuation. According to the filing, the company’s value increased from about $17 billion (about ₹1.62 lakh crore) to more than $1.4 trillion (about ₹133.20 lakh crore) over four years.
Texas alleges that this growth came while OpenAI failed to adequately protect users and properly disclose risks associated with its products.
Case Adds to Texas Scrutiny of Technology Companies
The lawsuit is the latest legal action brought by Texas against a major technology company over consumer protection, privacy and online safety issues.
In July 2024, Meta agreed to pay Texas $1.4 billion (about ₹13,320 crore) to settle allegations concerning the use of facial-recognition technology without users’ consent.
The OpenAI case goes further by seeking structural changes to how an artificial intelligence service operates, including restrictions on access by minors and independent review of future models.
The court will now consider Texas’s allegations and requests for penalties and injunctive relief. OpenAI has said it will continue working with governments on AI safety rules while defending its approach to ChatGPT safeguards.
About the author — Suvedita Nath is a science student with a growing interest in cybercrime and digital safety. She writes on online activity, cyber threats, and technology-driven risks. Her work focuses on clarity, accuracy, and public awareness.
