The Weekly Mutiny #9: No New Law Required
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The Weekly Mutiny #9: No New Law Required
September 21, 2026
Four cases this week, and not one of them needed a law written for artificial intelligence. A federal judge applied ordinary defamation doctrine to a Google AI Overview. A prosecutor used the same securities fraud statute that reaches any founder who invents customers. A Missouri sentence came down under a receiving provision that predates generative models by decades. The one suit resting on a specific statute relies on an Illinois biometric privacy law passed in 2008.
Google told a court its AI Overviews were opinion. The judge read them the way a user would.
Judge Thomas M. Durkin of the Northern District of Illinois allowed James Keene's defamation case to proceed on September 14. Keene is the former informant portrayed in Apple TV's Black Bird. Google's AI Overviews told users he was serving life without parole, and one version attributed that sentence to the murders of three women. His actual record is a cocaine distribution conspiracy conviction that was later expunged.
The two life sentence statements survived. The court dismissed a third as substantially true and a fourth for insufficient allegations of publication. The part worth reading is the actual malice analysis. Durkin found it plausibly pleaded because Keene notified Google more than once and the statements kept appearing anyway. Google's disclaimer defense failed because the Overviews cite outside sources, which the court said signals to an ordinary reader that they summarize verifiable fact. There is no Section 230 analysis in the opinion at all.
The ruling on Google's motion to dismiss.
The AI company fraud had nothing to do with the AI
Ilit Raz, founder and former chief executive of Joonko Diversity, pleaded guilty to securities fraud in the Southern District of New York. She raised roughly $27 million across two rounds, about $10 million in June 2021 and about $17 million in June 2022. She got it by naming customers the company did not have. The list included a credit card company, a sports apparel brand, an online travel company and a luxury fashion brand, none of which were clients.
Joonko sold an AI product for sourcing diverse job candidates. The case does not turn on the algorithm failing or on any claim about what the model could do. It turns on a fabricated customer list and false revenue figures, which is the oldest startup fraud there is wearing a newer label. She faces up to 20 years.
A 2008 Illinois statute is doing the heavy lifting against Meta
Wexler Boley & Elgersma filed a class action against Meta on September 4 in the Northern District of Illinois, on behalf of Illinois and California residents. The complaint targets two things. The first is NameTag, a feature for Meta's smart glasses that the filing says converts faces captured by the glasses into faceprints and matches them against biometric information Meta already holds. The second is the training of Meta's Emu and Muse Image models on Facebook and Instagram photographs.
The second allegation is the more aggressive one, and it is the reason to watch this case. The complaint argues that the training process itself creates and stores biometric information about the people in those images. If that reading holds, model training becomes a biometric collection event under the Illinois Biometric Information Privacy Act, a statute written in 2008 for fingerprint timeclocks. The suit also pleads California right of publicity claims and Civil Code section 3344(a). Whether training counts as collection is the question the case will turn on.
An 18 year sentence, under a statute that never mentions AI
Michael A. Huseman, 32, of Manchester, Missouri, was sentenced to 18 years on one count of receiving child pornography. Investigators recovered more than 22,000 files across two phones and two laptops. More than 400 of them were generated by AI. He was ordered to pay $23,000 in restitution to five identified victims.
The charging decision is the point. There is no AI specific offense here and none was required. The material was contraband under a provision written long before the tools that made part of it existed, and the generated files were counted alongside everything else.
Four items this week instead of five. The week produced fewer publishable posts than usual and padding the issue with a weaker one would not have served you.
Friday's Black Box lands September 25. If the pattern above holds, the question worth asking is not which new AI law passes, but which old one gets there first.