US states file lawsuit alleging OpenAI misled consumers

Eight US states – Iowa, Kansas, Nebraska, West Virginia, Arkansas, Arizona, Idaho, and Montana – each filed a separate lawsuit in their state courts on Wednesday, alleging that OpenAI misled consumers over ChatGPT safety and that the chatbot is an unsafe product that poses risks to children and vulnerable users.

The Arkansas lawsuit for instance, accuses the company of violating Arkansas’ Deceptive Trade Practice Act and the state’s Children and Teens’ Online Privacy Protection Act, a 2025 law that established privacy protections for teens online. In particular, the filing alleges that the defendants engage in false or deceptive acts/practices including designing and offering ChatGPT with inadequate safeguards.

Iowa Attorney General Brenna Bird said that OpenAI ‘claims ChatGPT is safe while it’s giving dangerous medical advice, encouraging people to hurt others, and coaching people to commit suicide – all while pretending to be their fake friend’.

The eight state actions follow a petition filed by Florida Attorney General James Uthmeier seeking an injunction that would stop OpenAI from further developing its ChatGPT system until a set of safety guardrails are imposed. Florida also filed a suit against the company in June alleging that ChatGPT encouraged self‑harm and was linked to violent incidents.

OpenAI spokesperson Drew Pusateri said the company ‘has built age‑specific protections into its product that many other AI products lack’. He said OpenAI is ‘working with states to advance policies that will apply to the entire industry’ and will ‘continue to work with experts to inform our work and build additional safeguards, such as the parental controls, break reminders, and age‑appropriate model protections that exist today’. He added that ‘while no system can be perfect, we’ll continue to work with experts to inform our work and build additional safeguards’.

In August, OpenAI launched a dedicated experience for minors called ‘ChatGPT for Teens’. The company said the product includes ‘educational features and age‑appropriate safeguards that are intended to reduce exposure to developmentally inappropriate or harmful content’. In a release at the time OpenAI stated: ‘Teens should be able to use AI to learn, create, and explore. But that access should come with protections that reflect their developmental stage, reinforce real‑world relationships, and support healthy use over time’.

Why does it matter?

This development demonstrates a multi-state‑level court action targeting OpenAI’s ChatGPT in an effort to protect consumers, particularly children and vulnerable users. The action taken by the eight states comes on the heel of a similar court filing by the Florida Attorney General.

Children have often been regarded as a vulnerable consumer group as they lack experience as consumers and are less able to resist the influence of others. The Arkansas Children and Teens Online Privacy Protection Act is one example of specialty legislation that recognises the vulnerability of children and teens and prescribes for their protection.

Although OpenAI has introduced age‑appropriate safeguards into their model, US states continue to allege that the company has not done enough to protect consumers. Arkansas in particular has made accusations against the design, offering and maintenance of the model as well as deceptive advertising practices.