On September 4, 2026, US District Judge Donovan W. Frank denied xAI LLC’s motion for a preliminary injunction against Minnesota Attorney General Keith Ellison, in a memorandum opinion and order entered in X.AI LLC v. Ellison (D. Minn., No. 0:26-cv-03425). The ruling leaves Minnesota’s ban on AI “nudification” technology fully enforceable while xAI’s underlying constitutional challenge continues. It is the second loss xAI has taken in the same case in six weeks: Judge Frank had already denied the company’s request for a temporary restraining order on July 31, 2026, the day before the law took effect.
The statute at issue, Minnesota H.F. 1606 (to be codified at Minn. Stat. section 325E.91), took effect August 1, 2026 and passed the legislature nearly unanimously. It bars a person who owns or controls a website, application or software from letting a user nudify an image or video, or from nudifying one on a user’s behalf, where “nudify” means altering or generating an image of an identifiable person to depict an intimate part so realistically that a reasonable person would believe it real. There is an exemption where the service requires technical skill of the user to do it. The Attorney General can enforce the law and seek civil penalties of up to 500,000 dollars per violation. xAI, whose Grok Imagine product is the named target, waited until July 27, 2026 to sue - days before the law took effect - arguing the statute violates the First Amendment.
The court was unpersuaded that xAI faced irreparable harm, writing that a genuine fear of imminent injury would have prompted faster action: the delay itself “strongly suggests a lack of irreparable harm.” Weighing the equities, the opinion found that the balance tips “steeply in favor of the State” given Minnesota’s near-unanimous, democratically enacted effort to address what the court treated as undisputed harm from nudification technology. xAI has filed notice that it will seek review at the Eighth Circuit, so the underlying case is not over, but the operative law stays in force in the meantime.
The ruling matters beyond Minnesota because it is a live test of the argument, now standard in industry litigation against state AI statutes, that content-generation restrictions on AI tools are speech restrictions subject to strict scrutiny. A federal court rejecting that argument at the preliminary-injunction stage, on a law that cleared a state legislature nearly unanimously, is a data point for other states drafting nudification or deepfake bans, and a reminder that speed of legal response is itself evidence courts weigh when a company claims irreparable harm.