Facing mounting pressure to acknowledge that Grok can still be used to generate non-consensual sexualized images of adults and minors, xAI filed a lawsuit Tuesday, suing the first user that Elon Musk’s firm has accused of using its chatbot to create illegal content.

The complaint targets Terry Wayne Harwood, who was arrested earlier this year for possession and distribution of child sexual abuse materials (CSAM), the South Carolina attorney’s office announced.

As xAI alleged, the company assisted in that arrest after discovering that Harwood had been using two xAI accounts for months to undress or “nudify” non-sexual images of multiple victims, including a young girl who appeared to be as young as 10.

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On Wednesday, the National Transportation Safety Board (NTSB) released preliminary findings verifying Elon Musk’s and Tesla’s claims that a driver involved in a fatal Texas crash that killed a grandmother overrode Full Self Driving in the moments ahead of impact.

Last month, 44-year-old Michael Butler told police that the autopilot feature was engaged at the time of the crash. On X, Musk disputed the claim, writing that Butler must have overridden the feature because “FSD drives slowly through neighborhood streets, and this was a high-speed crash!” Moving to back Musk’s claim, Tesla’s vice president of AI software, Ashok Elluswamy, said that internal data showed “the driver manually overrode self-driving by pressing the accelerator all the way to 100 percent of the accel pedal in this residential area.”

NTSB’s preliminary report, which does not yet determine what caused the crash, confirmed Tesla’s claims. Its probe found that FSD was engaged at the time of the crash, but electronic data showed “the driver manually overrode FSD (Supervised) by pressing the accelerator pedal to 100 percent.”

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This week, the Coalition for Independent Technology Research (CITR) won a key battle in its fight to reverse a visa-restriction policy that the Trump administration had used to attempt to revoke green cards and deport non-US citizens who work on misinformation, disinformation, fact-checking, content moderation, compliance, and trust and safety.

In an opinion published Tuesday, US District Judge James Boasberg granted a preliminary injunction blocking the State Department from enforcing the policy until the CITR’s lawsuit is resolved.

On its face, the policy does not require visa denials or deportations. Instead, it authorizes immigration investigations into individuals suspected of helping foreign adversaries attempt to manipulate public opinion by suppressing US speech.

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A federal judge reluctantly approved a $1.5 million settlement between Elon Musk and the Trump administration despite raising numerous concerns about a deal that lets Musk get off lightly for a rule violation that allegedly harmed Twitter investors.

In an order approving the deal, US District Judge Sparkle Sooknanan said she "has significant misgivings about the settlement" between Musk and the Securities and Exchange Commission (SEC), and described "red flags" in the SEC's decision-making. This isn't surprising given that she previously questioned whether the deal is tainted by corruption. But there is a high legal bar for rejecting the settlement, and the circumstances do not meet "that high threshold," she wrote yesterday.

"That means that this Court must accept the Parties’ consent judgment," Sooknanan, a Biden appointee, wrote. "Whether the Executive Branch (through the SEC) has done enough to hold Mr. Musk to account for his alleged violation is, like many other issues, for our citizenry to decide at the ballot box."

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One of the most horrific cases of allegedly Grok-generated child sex images was shared in a proposed class action lawsuit that was expanded Tuesday. Now, young girls not only accuse X and xAI of building toxic AI "nudify" tools but also of shielding child predators by obstructing police investigations into Grok-generated child sex abuse materials (CSAM).

In March, a girl’s stepfather took his own life after cops discovered that he had used Grok to create 7,000 sexually explicit images using one photo taken when his stepdaughter was 11 years old, the amended complaint alleged.

Grok allowed the man to generate extreme images depicting incest and rape without flagging any harmful behavior, the complaint said. Seemingly, xAI’s child safety system only intervened after the man input a prompt for “gang rape.” That request sent a CyberTip to the National Center for Missing and Exploited Children (NCMEC), which alerted law enforcement to the AI CSAM.

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Ahead of a July 2 deadline to submit public comments, advocates are warning the Federal Trade Commission that it must keep close watch over Elon Musk’s X and firmly reject a recent bid to end the agency’s ongoing audits of the platform’s data handling.

Last month, the FTC posted a notice explaining that X had argued that an FTC order was no longer necessary due to changes Musk had made to the platform.

The initial order came as a penalty after the FTC found that a coding error had caused then-Twitter to improperly share users’ contact information for ad targeting that had initially been submitted for two-factor authentication. Under the order, X is subjected to costly independent audits, and the FTC has authority to demand documents to ensure compliance with data privacy laws without taking additional legal action.

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One way Donald Trump plans to celebrate July 4th is by rolling out children’s savings accounts, known as Trump Accounts, and apparently, he’s been angling to get a big donation from SpaceX as part of that push.

A person familiar with talks involving the Trump administration told Semafor that SpaceX has spoken with US officials about donating stock to Trump Accounts. At this stage, however, it remains unclear if a donation will be made or what impact a SpaceX donation might have on the value of the accounts, which Trump hopes will be a defining part of his legacy.

So far, 6 million children have been signed up for Trump Accounts, which officially launch next week on Independence Day. Trump accounts are a new type of individual retirement account available to any child under 18 with a Social Security number, and parents can sign up their kids through a Trump Accounts app that's already available for download. As an extra perk, any child born between 2025 and 2028 can receive a one-time $1,000 contribution from the government.

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