Federal judge halts enforcement of Colorado's AI law after xAI First Amendment challenge

Judge Cyrus Y. Chung froze Colorado's SB 24-205 on April 27 following a joint request from xAI and Colorado Attorney General Phil Weiser. The state agreed not to enforce the law against xAI or issue rules under it until at least 14 days after the court rules on a forthcoming preliminary injunction motion.

Colorado's law required AI developers to police models for 'algorithmic discrimination' and inform the state of 'foreseeable risks' before June 30. xAI argued the statute is a First Amendment violation because it compels developers to embed the state's preferred viewpoints into AI systems, using vague terms like 'algorithmic discrimination' and 'reasonable care' that invite arbitrary enforcement.

Colorado spent two years promoting SB 24-205 as a model statute and it was the only state AI law named in President Trump's AI executive order. The law has now been put on hold while the governor's policy group drafts a replacement bill, marking a significant retreat from the state's original position.