xAI — now officially known as SpaceXAI after the merging of Elon Musk’s two companies – has filed a lawsuit against Minnesota Attorney General Keith Ellison to challenge the state’s new law that would ban apps and websites that can generate nonconsensual intimate images. It would also impose fines on their developers every time people use them to create sexual deepfakes. The law, the first of its kind in the nation, was approved by Gov. Tim Walz earlier this year and is slated to take effect in August. 

In its complaint, the company says the law was an “overbroad, content-based ban on free speech and the tools of visual expression in a clumsy attempt to prohibit ‘nudification.'” xAI, it reads, isn’t contesting Minnesota’s “interest in prohibiting the dissemination of artificially generated nude images of real people without their consent.” However, the law “extends far beyond that goal, exposing a wide array of protected speech to civil liability and government sanction.”

The company has been in hot water since the beginning of the year after reports came out that it has been allowing its users to transform photos of real women and children into sexualized images. Multiple authorities and regulators launched investigations into the company, including California’s, UK’s Ofcom, the European Commission and Ireland’s Data Protection Commission. Even after it implemented measures to prevent nonconsensual deepfakes, its system still allowed users to undress people.

“xAI strictly prohibits its users from generating nude or sexualized images of people without their consent and has indeed filed suit against users who evade its extensive technological blockers to generate such images in violation of this strict prohibition,” the company writes in its complaint. Indeed, it recently sued a user from South Carolina for using Grok to generate nonconsensual intimate imagery using real photos of numerous adults and minors.

The new law would fine developers $500,000 every time a user generates a nonconsensual adult deepfake using their products. xAI says that with that rule in place, it would have “no practical choice but to restrict Grok Imagine’s image-editing features in various ways when the statute takes effect on August 1, 2026.” It claims that “protected speech freely available before the law takes effect will thus be chilled.” The company is asking the court to declare the law unconstitutional and to prevent the state from enforcing it. 

In response to the lawsuit, Ellison posted on X that there are plenty of worthy debates to be had when it comes to AI, but this isn’t one of them. “AI nudification robs the target of their dignity and could cause them immense harm on many levels.” Gov. Waltz simply posted: “See you in court, creep.”

Using AI to generate nude images of people against their will is appalling.

There are plenty of worthy debates to have about AI. This is not one of them. AI nudification robs the target of their dignity and could cause them immense harm on many levels.

I’ll see X in court. https://t.co/OcsZPkVNmk

— Attorney General Keith Ellison (@AGEllison) July 28, 2026