Elon Musk's xAI Battles Minnesota Over Groundbreaking 'Nudification' Tech Ban

Elon Musk’s company xAI has initiated a federal lawsuit against the state of Minnesota, challenging its first-in-the-nation law that bans the use of “nudification” technology on websites and applications. This legal action, filed just days before the law was set to take effect, establishes a significant test case for the constitutional limits of state regulation over artificial intelligence technologies.

Minnesota’s law, signed in May and scheduled to become active, aims to outlaw the increasingly prevalent technology that enables individuals to use AI to generate fake nude images of real people without their consent. The state seeks to curb the proliferation of such content by targeting the tools that create it.

In its 38-page lawsuit, xAI, which operates the AI model chatbot and image generator Grok on platforms like X (formerly Twitter), clarifies that it does not dispute the state's interest in prohibiting the distribution of AI-generated nude images of real people without their permission. However, the company argues that Minnesota’s statute goes “far beyond that goal.” xAI contends that the law unconstitutionally bans many images and videos that are otherwise protected speech, subjecting companies to a severe penalty of $500,000 per violation.

A central point of xAI’s complaint is the absence of a “safe harbor” provision within the law for companies that make good-faith efforts to prevent the creation of such images by users. Furthermore, the lawsuit asserts that the law's scope extends to images consented to by the depicted person or even created by that individual. xAI also criticizes the law’s definition of “intimate part” as overly broad, arguing it encompasses body parts routinely displayed in public without issue.

Minnesota Attorney General Keith Ellison, in a statement, expressed strong disapproval of AI nudification, calling it "appalling" and something that "robs the target of their dignity and can cause immense harm on an emotional, personal, and professional level." Ellison emphasized that while there are many worthy debates regarding AI policy, the issue of banning AI nudification is not one of them, indicating the state's firm stance against the technology.

The legal landscape for AI regulation has seen mixed outcomes. While state laws targeting election deepfakes have faced constitutional challenges (California's law was blocked over First Amendment speech protections), Minnesota’s nudification law has previously survived a court challenge in 2025. This law is distinct from existing state and federal statutes that outlaw deepfakes, which typically penalize the individuals who use these tools to create non-consensual sexually explicit images, rather than the makers of the tools themselves. The federal Take it Down Act, enacted last year, also mandates that websites and apps implement a process for removing such images.

Other states have approached the issue differently; for example, Texas last year made website or app owners liable for civil damages—and potentially criminal penalties—if they knew a person hadn't consented to a nudified image or failed to promptly remove it upon notification.

xAI, for its part, highlights its own internal policies for Grok. The terms of service explicitly prohibit the use of Grok for “any illegal, harmful, or abusive activities” that violate privacy, including altering images to nudify individuals or depict them in sexually explicit content. The company states it enforces these rules through account suspensions or terminations and by reporting suspected child sexual abuse content. xAI reiterated its “zero tolerance for any forms of child sexual exploitation, non-consensual nudity, and unwanted sexual content” earlier this year. Following a global outcry over sexualized images of women and children, Grok announced in January that it would geoblock content violating laws in specific locations and implemented technological measures to prevent users from editing photos of real people in revealing clothing, such as bikinis or underwear, in jurisdictions where such actions are illegal. This effectively shut down Grok’s controversial “spicy mode” which previously allowed for explicit content creation.