Elon Musk’s artificial intelligence company xAI has filed a lawsuit against the state of Colorado, seeking to block new AI regulations that it says restrict the speech of chatbots such as Grok.
The company is challenging Colorado’s Senate Bill 24-205, which is designed to prevent “algorithmic discrimination” in areas including employment, housing, and finance.
In a filing submitted to a U.S. district court in Colorado on Thursday, xAI argued that “Colorado cannot alter xAI’s message simply because it wants to amplify its own views on the highly politicized subjects of fairness and equity.”
xAI further contended that the law, which is scheduled to take effect on June 30, is contradictory because it promotes “differential treatment” in efforts to “increase diversity or redress historical discrimination.”
The company also argued that requiring changes to Grok would interfere with its stated goal of being “maximally truth-seeking.”
Colorado is not the first state targeted by xAI over AI regulation. In December, the company also sued California over its Generative AI Training Data Transparency Act, arguing that its disclosure requirements amount to compelled speech and risk exposing trade secrets, in violation of the First and Fifth Amendments.
Both the Colorado and California laws come amid criticism of Grok following past incidents in which the chatbot was accused of producing racist, sexist, and antisemitic responses.
Calls for federal oversight over state AI rules
White House AI czar David Sacks has urged state governments to avoid creating individual AI regulatory frameworks, advocating instead for a unified federal standard.
He warned that fragmented state-level rules are creating a “patchwork” system that is difficult for companies to navigate. “The problem that we’re seeing right now is that you’ve got 50 different states regulating this in 50 different ways, and it’s creating a patchwork of regulation that’s difficult for innovators to comply with,” Sacks said in late March.
Sacks was later appointed co-chair of the newly established President’s Council of Advisors on Science and Technology, where he is expected to help address coordination issues in AI governance.
