Minnesota’s ban on AI-generated non-consensual nude imagery is moving forward as planned, after a federal judge declined xAI’s bid to hit the brakes on the law before it takes effect on August 1, 2026.
The ruling means Elon Musk’s AI company, along with every other provider operating in the state, now faces potential penalties of up to $500,000 per violation under HF 1606.
What xAI argued, and why it didn’t work
xAI filed its lawsuit on July 27, 2026, in the US District Court for Minnesota, just days before the law was set to kick in. The case, filed against Attorney General Keith Ellison, challenges HF 1606 on constitutional grounds.
xAI says it supports efforts to prevent non-consensual deepfakes, but contends the law is excessively broad. The company argues the statute punishes AI providers regardless of what safeguards they’ve built or whether they had any intent to cause harm.
Under HF 1606, if your AI tool can generate or alter images to depict someone in intimate scenarios without consent, you’re on the hook regardless of how many content filters you’ve deployed.
xAI sought both declaratory relief, asking the court to rule the statute unconstitutional under the First Amendment, and a preliminary injunction to freeze enforcement while the case plays out. The judge denied the injunction request, meaning the law will be enforceable starting August 1.
Minnesota’s bipartisan bet on AI regulation
The Minnesota House passed HF 1606 132-1. The Senate went 65-0.
Minnesota already had laws criminalizing the distribution of non-consensual deepfake content. HF 1606 extends the regulatory perimeter upstream, targeting the companies that build the tools, not just the people who misuse them. This positions Minnesota as the first state to impose direct liability on AI companies for nudification capabilities.
Prior litigation in 2025 involving Musk-linked entities challenged earlier versions of Minnesota’s deepfake laws but failed to overturn them. The state’s track record of defending these statutes in court likely factored into the judge’s decision to let HF 1606 proceed.
The case remains in its early stages, with xAI’s constitutional challenge still pending on the merits. The denial of the preliminary injunction signals that the court isn’t convinced the company will ultimately prevail.