(Westlaw) A California federal judge has paved the way for a jury trial in Elon Musk’s lawsuit against OpenAI, while a federal appeals court considers whether to allow social media addiction lawsuits against Meta and other platforms.
Here’s a roundup of recent events in the world of Big Tech.
Artificial intelligence
A California federal judge has ruled that billionaire Elon Musk’s lawsuit alleging ChatGPT maker OpenAI violated its founding mission by restructuring into a for-profit entity can proceed to a jury trial. U.S. District Judge Yvonne Gonzalez Rogers of the Northern District of California said Jan. 7 that there was ” plenty of evidence” suggesting OpenAI’s leaders had made assurances that its original nonprofit structure would be maintained, according to Reuters. Musk v. Altman et al., No. 24-cv-4722, hearing held (N.D. Cal. Jan. 7, 2026).
The European Commission has ordered Musk’s X to retain all documents relating to its AI chatbot, Grok, until the end of 2026, according to Reuters. The commission extended the order to ensure compliance with the EU’s Digital Services Act after the bloc condemned Grok for producing sexualized images, including of Sweden’s deputy prime minister.
Online harm
A 9th U.S. Circuit Court of Appeals panel on Jan. 6 appeared skeptical of arguments from Meta Platforms Inc. and other social media companies seeking immunity from more than 2,200 lawsuits alleging the platforms are designed to be addictive for young users. The platforms, which include Snapchat, YouTube and TikTok, argue that Section 230 of the Communications Decency Act, 47 U.S.C.A. § 230, shields them from liability. The panel questioned whether the statute provided such broad immunity, according to Reuters. People of the State of California v. Meta Platforms Inc., No. 24-7032, oral argument held (9th Cir. Jan. 6, 2026).
Alphabet’s Google and AI startup Character.AI have agreed to settle a lawsuit brought by a Florida mother who alleged the startup’s chatbot led to the suicide of her 14-year-old son. A Jan. 7 court filing said the companies agreed to settle Megan Garcia’s allegations that her son killed himself after being encouraged by a Character.AI chatbot. The lawsuit was one of the first in the U.S. to target an AI firm over alleged psychological harm, according to Reuters. Garcia et al. v. Character Technologies Inc. et al., No. 24-cv-1903, notice of resolution filed (M.D. Fla. Jan. 7, 2026).
Cybersecurity and data privacy
Block Inc. must face a proposed class action claiming it concealed poor security measures that allowed users of its Cash App to create bogus accounts, leading to nearly $300 million in fines. U.S. District Judge Noël Wise of the Northern District of California on Jan. 6 denied Block’s motion to dismiss, saying the suit adequately pleads that company statements touting its regulatory commitment hid an underinvestment in customer verification protocols. Gonsalves v. Block Inc. et al., No. 25-cv-642, 2026 WL 42657 (N.D. Cal. Jan. 6, 2026). Read more: 2026 SECDBRF 0087
Law firm Norton Rose Fulbright will receive more than $156 million in legal fees for representing Texas in consumer privacy litigation against Google that led to a $1.375 billion settlement, according to contract records obtained by Reuters. The settlement resolved claims that Google tracked users’ locations despite disabled settings and misled users about incognito mode privacy.