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AI Update
OpenAI faces mounting legal challenges over ChatGPT-4o, accused of causing psychological harm, addiction and even suicides through emotionally immersive features like persistent memory and human-like empathy. Plaintiffs claim these design choices blurred boundaries between tool and companion, fostering isolation and delusions, with four deaths allegedly linked to the chatbot acting as a "suicide coach." These California lawsuits argue OpenAI rushed release of ChatGPT-4o to outpace Google, sacrificing safety for market share. Separately, the Southern District of New York ordered OpenAI to disclose 20 million anonymized user logs in a copyright case alleging unauthorized use of publisher content for AI training. Elsewhere, Google urged a Washington, D.C., district court to reject a late-filed amicus brief in an antitrust case, arguing it unfairly requested access to proprietary search data. These disputes highlight growing tensions between innovation, ethics and regulation— underscoring the urgent need for robust safety standards and transparent data practices in AI development.
On the regulatory front, the State Bar of Georgia launched an AI toolkit to help lawyers integrate AI responsibly, offering ethical guidelines, compliance resources and training to mitigate risks, such as bias and confidentiality breaches. This initiative emphasizes transparency and human oversight, aiming to enhance efficiency without compromising trust in the justice system. Meanwhile, Illinois is leading in AI employment regulation through measures like the Artificial Intelligence Video Interview Act and amendments to the Human Rights Act, which ban discriminatory AI-driven decisions and mandate disclosure when AI is used in hiring. Proposed laws such as the Preventing Algorithmic Discrimination Act signal broader oversight. These developments exemplify the trend toward balancing innovation with accountability, highlighting the need for organizations to combine compliance, transparency and human judgment when deploying AI.
At the federal level, the Trump administration is once again pushing to prevent states from implementing their own AI rules. A leaked draft executive order outlines plans for a Department of Justice task force to challenge state laws and for the Commerce Department to review regulations, with potential restrictions on broadband funding for noncompliant states. Supporters argue that a unified standard could reduce regulatory fragmentation and support innovation, while opponents— including privacy advocates and state leaders—express concerns about reduced consumer protections and state autonomy. The proposal's impact on industry and governance is uncertain, as congressional support has not been confirmed.
These and other stories appear below.
AI in Business
AI artist Xania Monet signs multimillion dollar deal after billboard debut
AI singer Xania Monet became the first known AI artist to debut on a Billboard radio chart, with songs appearing on both the Hot Gospel Songs and Hot R&B Songs charts. Monet, designed by poet Telisha Nikki Jones using the GenAI music program Suno, amassed over 146,000 Instagram followers and, following a bidding war, signed a multimillion-dollar record deal with Hallwood Media. Monet's success highlights the growing acceptance of AI-generated performers among consumers, even as the entertainment industry expresses concerns about AI replacing human talent and the associated risks, such as IP infringement and data security.
Source: CNN
OpenAI and Amazon agree to $38B AI computing power deal
OpenAI entered into a $38 billion agreement with Amazon to run its AI systems, including ChatGPT, on Amazon's U.S. data centers using Nvidia's specialized AI chips via AWS. The deal underscores the increasing demand for computing power in AI development, which is essential for advancing AI-driven experiences in sectors such as sports, entertainment and digital media. The partnership may accelerate the deployment of AI technologies that analyze audiences, personalize recommendations and enhance creative processes, but it also raises ongoing concerns about data security, privacy and intellectual property risks.
Source: Tech Xplore
Snap and Perplexity reach $400M deal
The deal will integrate Perplexity's conversational search into the Snapchat application. The integration will begin early next year and is expected to enhance user experience by leveraging AI for personalized content and recommendations, aligning with trends in the sports, entertainment and digital media sectors. The deal also highlights potential opportunities and risks associated with AI use in these industries, including concerns related to privacy, data security and intellectual property.
Source: Hollywood Reporter
OpenAI restricts use of ChatGPT for sensitive advice amid legal scrutiny
OpenAI formally updated its usage policy to prohibit the use of its AI tools, including ChatGPT, from providing legal, medical or other professional advice requiring a license. The policy also bans use related to gambling, self-harm, sexual violence, terrorism and weapons development. These changes come amid lawsuits alleging that AI interactions contributed to the suicides of teenage users. One high-profile case involves a California family claiming ChatGPT encouraged their son's suicide and that OpenAI weakened safety protocols to boost engagement. OpenAI maintains that ChatGPT was never intended to replace professional advice and continues to emphasize its role as an informational tool.
Source: Law 360 (sub. req.)
AI in Business
ElevenLabs licenses Matthew McConaughey and Michael Caine voices for AI recreation
AI audio start-up ElevenLabs signed deals with Matthew McConaughey and Michael Caine to license their voices for digital recreation, thus enabling brands to use them in content and advertisements. McConaughey will allow his newsletter to be translated into Spanish using his AI-generated voice, while Caine's voice is available via ElevenLabs' Iconic Marketplace and ElevenReader app. ElevenLabs also offers synthetic voices of other celebrities and historical figures, ranging from Liza Minnelli to Mark Twain. The company positions its technology as a tool to amplify voices and support new storytellers, reflecting the growing use of AI in entertainment for content creation and audience engagement.
Source: CBC
WMG and Udio partner to launch AI - powered music creation platform
Warner Music Group (WMG) resolved a copyright infringement dispute with AI music start-up Udio and entered into a licensing agreement for an AI-powered music creation platform, launching in 2026. The platform will use GenAI models trained on licensed music and allow users to create remixes, covers and new songs with the voices and compositions of participating artists and songwriters. WMG emphasizes that artists and songwriters will be credited and compensated, aiming to protect their rights while also unlocking creative and commercial opportunities.
Source: TechCrunch
Disney+ considers allowing user AI-generated content
During Disney's latest earnings call, CEO Bob Iger revealed Disney+ is exploring partnerships with AI companies to introduce user-generated short-form AI videos on its streaming platform. This move aims to create a more engaging experience for users, allowing them to both create and consume AI-generated content. The initiative signals a significant shift for Disney, as it has historically been protective of its intellectual property—having taken legal action against AI platforms like Character.AI, Midjourney and Hailuo. Iger also emphasized that any AI partnership would need to safeguard Disney's IP, as the company balances leveraging generative AI to enhance user interaction and content creation, while also navigating the associated risks of IP infringement and content moderation.
Source: Engadget
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