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A federal judge has issued a temporary block on Colorado enforcing its pioneering artificial intelligence consumer protection law, halting state action against alleged violations amid a legal challenge from xAI and the U.S. Department of Justice.
U.S. District Judge Cyrus Y. Chung ruled on April 27 that Colorado is prohibited from taking enforcement actions on any alleged violations occurring up to 14 days after the court decides on xAI’s motion for a preliminary injunction, wrote The Epoch Times.
The Colorado law, signed by Gov. Jared Polis (D) in May 2024, was originally set to take effect on June 30, 2026. It would have imposed new requirements on AI developers and deployers, which critics argued would force algorithmic discrimination based on race, sex, and religion under the banner of diversity, equity, and inclusion (DEI) initiatives.
Assistant Attorney General Brett Shumate of the DOJ’s Civil Division described the court’s decision as “a huge win for the American people.” In a May 1 post on X, Shumate noted that “Colorado immediately caved and agreed not to enforce the law against ANY AI company.
”The Justice Department joined xAI as a plaintiff in the lawsuit on April 24 — marking the first time the DOJ has intervened in a state-level challenge to AI regulation. Both parties contend that the Colorado statute would unconstitutionally mandate “algorithmic discrimination.”
“Laws that require AI companies to infect their products with woke DEI ideology are illegal,” said Assistant Attorney General Harmeet K. Dhillon of the DOJ’s Civil Rights Division. “The Justice Department will not stand on the sidelines while states such as Colorado coerce our nation’s technological innovators into producing harmful products that advance a radical, far-left worldview at odds with the Constitution.”
xAI, the company founded by Elon Musk that developed the Grok AI model, filed its lawsuit on April 9, seeking to prevent enforcement of the unrevised law.
Gov. Polis, while signing the bill, expressed reservations about its potential impact on Colorado’s growing tech sector. In a statement at the time, he urged lawmakers to revise the measure and delay its implementation until January 2027.
“I am concerned about the impact this law may have on an industry that is fueling critical technological advancements across our state for consumers and enterprises alike,” Polis wrote.
Despite the governor’s concerns, the legislation was not substantially revised and was instead delayed by one year to June 30, 2026, prompting the legal action.
