A powerful coalition of state attorneys general has launched a sweeping investigation into OpenAI, marking an escalation in regulatory scrutiny for the artificial intelligence (AI) pioneer as it prepares to go public.
New York Attorney General Letitia James spearheaded the action by serving OpenAI with a broad subpoena, according to documents viewed by The Wall Street Journal.
The legal demand seeks internal documents regarding the company’s advertising, user retention strategies, handling of consumer and health data, safety policies regarding minors and seniors, and technical phenomena like “model sycophancy.”
The multi-state inquiry arrives at a critical financial juncture for OpenAI, which confidentially filed IPO paperwork with the Securities and Exchange Commission (SEC) earlier this month. The initial public offering could value the artificial intelligence giant at up to $1 trillion.
While the multi-state probe is currently an information-gathering exercise, OpenAI is already entangled in severe litigation elsewhere.
Florida Attorney General James Uthmeier filed a civil lawsuit against OpenAI and its CEO, Sam Altman, accusing the company of aggressively marketing ChatGPT to the public, including children, while allegedly suppressing internal safety warnings and concealing known risks.
The lawsuit follows a criminal inquiry launched by Florida authorities in April regarding a mass shooting at Florida State University last year that left two people dead. Investigators allege the suspect utilized ChatGPT as a “sounding board” to plan the attack, and that the chatbot actively dispensed advice to his queries.
The legal pressure on OpenAI is part of a broader, bipartisan push by state regulators to rein in generative AI technologies that have rapidly outpaced existing legal frameworks.
In December, 42 state attorneys general, led by Pennsylvania AG Dave Sunday, issued a formal warning to tech giants including OpenAI, Meta Platforms Inc., Anthropic, Google, and xAI. The letter explicitly warned that developers could be held legally accountable if their generative AI products encourage criminal acts.
California Attorney General Rob Bonta previously announced an investigation into xAI’s Grok chatbot over the large-scale production and dissemination of explicit, non-consensual images used for harassment on Elon Musk’s social media platform, X.
In response to the mounting investigations, OpenAI has maintained a cooperative stance, emphasizing its commitment to technological safety.
“AI is a new and powerful technology, and we work every day to safely bring its benefits to people in a responsible way,” an OpenAI spokesperson said in a statement. “We take the concerns raised by state attorneys general seriously and intend to engage constructively with their offices.”
Legal experts note that the focus on consumer and health data is particularly critical for conversational AI. Unlike traditional search engines, chatbots often prompt users to disclose highly sensitive personal information, creating unprecedented privacy and liability challenges that regulators are now determined to address.
