Texas Sues to Bar ChatGPT for Minors, $8.25M Google Play Kids' Settlement: Parenting News Oct. 24

What Texas's OpenAI suit, the Google Play settlement, the TikTok appeal and new state actions do

By TDmonthly Staff
October 2026

Texas has asked a court to stop OpenAI from offering ChatGPT to minors in the state, a federal judge gave final approval to an $8.25 million settlement over kids' data in Google Play apps, and the Justice Department's appeal in the TikTok children's-privacy case is on the docket. Plus a new Pennsylvania reporting law on AI-made abuse images and hazing, and a Texas settlement that makes Temu test for lead, PFAS and phthalates. Lawsuits are allegations, not findings; here is what each filing or law says.

1. Texas Sues OpenAI and Sam Altman, Asks a Court to Bar ChatGPT for Minors in Texas

Texas Attorney General Ken Paxton filed suit on Oct. 23 in Collin County District Court against OpenAI, several affiliated OpenAI companies and CEO Sam Altman. The petition brings claims under the Texas Deceptive Trade Practices-Consumer Protection Act and the state's SCOPE Act (Securing Children Online through Parental Empowerment). Among its allegations, which OpenAI has not had a chance to answer in court:

The free version of ChatGPT has "no gatekeeping or age verification mechanism whatsoever," and the paid version asks for age but doesn't verify it.
Parental controls added in September 2025 don't require children's accounts to be linked to a parent, alert parents only in "limited situations," and never let parents see what a child told ChatGPT.
OpenAI doesn't give verified parents the SCOPE Act tools to control a minor's privacy and account settings or to monitor and limit time on the app.

Texas asks for injunctions that would, among other things, stop OpenAI from "Offering ChatGPT to minors in Texas," from offering content unsuitable for children without age verification or parental consent, and from releasing new AI models to Texas users unless a court-approved independent evaluator approves their safety guardrails. It also seeks civil penalties of $10,000 per violation of the Deceptive Trade Practices Act (including each that is also a SCOPE Act violation), disgorgement and fees. This suit is separate from the Oct. 14 suits filed by Arizona, Arkansas and other states.

Source: Texas Attorney General

Source: Texas's Original Petition (PDF)

2. Judge Gives Final Approval to $8.25 Million Google Play Kids' Privacy Settlement

On Oct. 23, U.S. District Judge P. Casey Pitts in San Jose granted final approval of a class settlement in A.B. v. Google LLC and AdMob Google (N.D. Cal. No. 5:23-cv-03101). The class is everyone in the U.S. who was younger than 13 when they downloaded or used an app from Google Play and from whom Google allegedly collected, used or disclosed personal information, from April 1, 2015, to the present; the order ties the allegations to Google's "Designed for Families" program. Key numbers from the court's orders:

An $8,250,000 cash fund, paid pro rata to class members with valid, timely claims.
656,974 claims received as of Sept. 8, 2026. The court said that if all are valid, payments would work out to about $12.55 per claim, below plaintiffs' first estimate of $40 to $110; that figure is the court's example, not a final amount.
No objections and 21 timely opt-outs.
Attorneys' fees of $2,062,500 (25% of the fund).

The order says the settlement is not an admission of wrongdoing or liability by Google. The orders don't give a payment date.

Source: Final approval order (PDF)

Source: Fees and awards order (PDF)

3. Appeal Filed in TikTok Children's-Privacy Case Over 2019 Musical.ly Order

A notice of appeal to the Ninth Circuit was filed Oct. 23 in United States v. Musical.ly (C.D. Cal. No. 2:19-cv-01439), the date the Justice Department said a day earlier it would appeal the court's final order. In September, Judge George H. Wu denied the government's unopposed motion to vacate the 2019 consent order that resolved children's-privacy (COPPA) charges against Musical.ly, now TikTok. The 2019 order stays in force unless a court vacates it; filing an appeal doesn't change that.

Source: Court docket, entry 26

Source: U.S. notice, Oct. 22 (PDF)

4. Pennsylvania Makes AI-Generated Child Sexual Abuse Images and Hazing Mandatory to Report; Phone Ban Still Unsigned

Gov. Josh Shapiro signed House Bill 2474 (Act 87 of 2026) on Oct. 22. It amends the state's Child Protective Services Law so mandated reporters, including school staff, must report to ChildLine if they have reasonable cause to suspect child sexual abuse material or artificially generated child sexual abuse material, "regardless of whether the material was created, displayed or exhibited to others by a minor," or that hazing or aggravated hazing occurred. It takes effect 90 days after enactment. Final votes were 50-0 in the Senate and 203-0 in the House.

Senate Bill 1014, the bell-to-bell school phone ban, is not law yet: as of Oct. 24 its last action is still "Presented to the Governor, Oct. 22, 2026," and it isn't among the 58 bills the governor announced signing that day.

Source: HB 2474 bill page

Source: HB 2474 text

Source: Governor's office

Source: SB 1014 bill page

5. Texas Settlement Requires Temu to Test for Lead, PFAS and Phthalates and Pull Recalled Products Within 2 Business Days

The Texas attorney general announced an agreed final judgment with Temu on Oct. 16. The AG's release says reports claimed products on the platform, "including clothing, household items, children's toys, and baby products," may contain harmful chemicals; those are claims, not findings. Under the posted judgment, for Texas consumers:

Temu must remove recalled, prohibited or noncompliant products within two business days of a U.S. or Texas recall or safety alert.
An independent firm must test a cross-section of commonly bought products every year for lead, PFAS, phthalates, formaldehyde and heavy metals. Products over a federal safety standard must be delisted within two business days, sellers terminated within five, and Texas buyers notified and given a full refund.
Before listing a product covered by a CPSC rule, Temu must collect compliance certificates and test results from a CPSC-accepted or ISO/IEC 17025-accredited lab.
Temu pays Texas $3 million; the judgment lasts four years and also sets data-security rules.

Separately, on Oct. 22 the AG announced an Assurance of Voluntary Compliance in which Lululemon will keep requiring vendors to prove compliance with its restricted-substances list, including PFAS limits, for three years. The agreement says the state "did not identify PFAS in lululemon products or Materials." The AG's office also said it is "actively investigating other clothing brands such as Hanes and Fruit of the Loom to ensure children's clothing is free from harmful chemicals"; that is an investigation, not a lawsuit or finding.

Source: Texas Attorney General: Temu

Source: Temu agreed final judgment (PDF)

Source: Texas Attorney General: Lululemon

Source: Lululemon AVC (PDF)

For recent recalls, see our latest recall roundup; CPSC had posted no new children's-product recalls after Oct. 22 as of the morning of Oct. 24.

For the full weekly market brief: The ToyDirectory Intelligence Report

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