Eight states take ChatGPT to court

On Wednesday, the attorneys general of Arizona, Arkansas, Idaho, Iowa, Kansas, Montana, Nebraska and West Virginia each sued OpenAI in their own state courts, mostly under consumer-protection laws. They allege that the company misled the public about ChatGPT’s safety, that the chatbot reinforced delusions, gave dangerous medical advice and coached some users, teenagers among them, to harm themselves or others, and that it collected data from children unlawfully. The remedies they want range from fines for each violation to age checks, default nighttime limits for children and an independent monitor in West Virginia. Arizona, Idaho and Montana also want OpenAI’s advanced models tested only in secure, independently verified environments. “OpenAI is hurting kids and they are lying to Iowans,” said Iowa Attorney General Brenna Bird. OpenAI said “no system can be perfect,” pointed to its parental controls and teen protections, and said it would rather work with states on rules for the whole industry. Florida filed the first state suit in June. Reuters called the new suits the most significant coordinated state action yet against an AI company.

Why it’s signal: with no federal AI law, the rules for chatbots are being written state by state, in court. Several of these states are asking judges for more than fines. They want a say in how AI models are tested and released, a decision that until now has belonged to the companies alone.

A frontier model you can download

On Thursday, Meta released Muse Spark Open, which it calls the most capable American open-weight model to date. It has 816 billion parameters, 42 billion of them active at once, and Meta worked with Apple so that two top-end Mac Studios can run it at home. The weights are on Hugging Face, so anyone can download, modify and keep it. Two days earlier, more than 400 scientists, among them Geoffrey Hinton, Yoshua Bengio and the cryptographer Ron Rivest, signed an open letter asking labs to keep AI models with serious hacking skills cut off from the internet by default, after several labs disclosed models reaching real outside systems during testing. Meta was one of them: in July, a pre-release Muse Spark model breached an outside company’s systems during a security test, which Meta blamed on a testing partner’s misconfiguration. MIT Technology Review’s explainer on the open-model debate, published the same week, found real benefits on both sides. Open models are cheaper, help researchers and defenders, and keep AI out of a few companies’ hands. But a recent study it cites found that no current method of making a model tamper-resistant holds up against every attack.

Why it’s signal: a model that has been downloaded can’t be unplugged, patched or recalled. As open models close the gap with closed ones, now only a few months behind by MIT Technology Review’s account, the decision to release becomes the one safety decision that can never be revisited.

A thousand contractors to fix what AI found

On Wednesday, Bank of America CEO Brian Moynihan said the bank had brought in about 1,000 outside contractors to repair software weaknesses exposed by advanced AI models, including Anthropic’s Mythos. They joined about 3,000 bank employees already doing the work, and the flaws sat in code used by both the bank and its vendors. Moynihan put the quarter’s repair bill at “a couple hundred million dollars plus,” a figure that also covers separate fixes to the bank’s anti-money-laundering controls, and said he expects the AI-related share to fall, Quartz reports. Anthropic gave Mythos to a small group of banks, companies and government agencies in April so they could find and patch flaws before attackers did. U.S. regulators paused some cyber exams to give the largest banks time to fix what it found, and the European Central Bank wants banks’ plans against AI-enabled threats by the end of this month.

Why it’s signal: finding a flaw now takes a machine, but fixing one still takes a person. The bill for AI’s defensive power is arriving as a hiring bill, and a bank this size can pay it. It is much less clear who will fix the same kinds of flaws in the software that smaller banks, hospitals and town governments depend on.