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Lawsuit demands OpenAI halt unsafe development that caused Hugging Face hack
OpenAI makes others suffer “the harms of its unsafe decision-making,” nonprofit says.
OpenAI’s hack of Hugging Face in July 2026 has spurred a lawsuit demanding that the company stop accessing third-party computer systems and halt AI development practices that can harm the public. The lawsuit was filed by Legal Advocates for Safe Science & Technology (LASST), which said yesterday that the hack in which OpenAI “agents stole credentials, uploaded malicious files, and gained control over key parts of Hugging Face’s internal systems… is unquestionably illegal under California law.”
California’s Comprehensive Computer Data Access and Fraud Act (CDAFA) prohibits unauthorized access into computer systems, “and it doesn’t matter that a swarm of AI agents carried out this cyberattack. California law makes it clear that it is not a defense ‘that the artificial intelligence autonomously caused the harm,’” the group said.
The lawsuit, filed in San Francisco County Superior Court, said OpenAI also violated California’s Unfair Competition Law (UCL). “OpenAI’s insistence on externalizing the harms of its unsafe decision-making is a fundamentally unfair business practice,” the complaint said, adding that “such risk-taking for private gain at substantial public expense is immoral, unethical, oppressive, unscrupulous, and substantially injurious conduct.”
LASST said it wants “a court order prohibiting OpenAI’s AI agents from accessing third-party computer systems without permission and forbidding OpenAI from continuing to employ unsafe AI development practices that threaten serious harm to the public.” The lawsuit does not ask for any compensatory or punitive damages from OpenAI, requesting only attorneys’ fees.
OpenAI said in a statement provided to Ars that “Hugging Face was a serious incident and we’ve taken a series of actions in response to it, but this lawsuit is completely without merit.” Defending its response to the hack, OpenAI noted that it published a technical report and other information about “third-party impact from misaligned models,” slowed development of its AI, and held back the release of a model that doesn’t meet its safety standards.
LASST said OpenAI’s voluntary response hasn’t been good enough and that the firm should be subject to court-imposed restrictions. “A business practice that exposes third parties and the public to uncontrolled, self-directed intrusions by systems that OpenAI admits it cannot fully predict or contain is unfair under any weighing of its utility against its consequences,” the group said.
LASST’s lawsuit said OpenAI quickly resumed training and evaluations of AI systems after the Hugging Face hack and other security incidents. “OpenAI will continue to train and evaluate advanced models, without proper oversight, in sandboxes that are vulnerable to exploitation by those models,” the lawsuit said.
A New York Times report yesterday said OpenAI executives ignored employees who warned months before the Hugging Face hack that OpenAI’s newest models weren’t being appropriately monitored. “In response, OpenAI executives told the employees that the tests needed to move forward as quickly as possible to release the AI models on time,” the NYT reported. “No additional security protocols were instituted, said the workers, who were not authorized to speak publicly on sensitive matters.”
LASST said it has standing to sue OpenAI because the state Unfair Competition Law “allows organizations to go to court on behalf of the public when a company does something unlawful or unfair, so long as those organizations were also injured by that company’s unlawful conduct.”