State attorneys general (AGs) are expected to continue their work in 2026, with a focus on emerging issues surrounding artificial intelligence, consumer protection, and civil rights.
I. Artificial intelligence
New York enacts nation-leading AI transparency law
New York Governor Kathy Hochul signed a landmark bill mandating the “AI Frontier Model” framework, part of the Responsible AI Safety and Education (RAISE) Act. Under the law, AI developers will be required to establish and publish a safety framework for advanced AI systems and report any serious harm to the state within 72 hours of discovery. The measure also creates a new oversight office within the New York Department of Financial Services tasked with annual reporting on AI safety and transparency.
Additionally, the law authorizes the New York State Attorney General to bring civil actions against AI Frontier developers who fail to file required reports or make false statements, subject to fines of $1 million for a first violation and up to $3 million for subsequent violations.
State administrations oppose federal efforts to override state AI laws
A bipartisan coalition of 24 state attorneys general sent a comment letter to the Federal Communications Commission (FCC) opposing an investigation that could lay the groundwork for federal preemption of state AI regulations. In the letter, the coalition argued that the FCC does not have the authority to override state laws addressing AI, arguing that such preemptive action would limit states’ ability to protect consumers, especially in areas such as privacy. Specifically, the State Audit Commission argues that the FCC’s proposal would violate core state responsibility functions protected by the Tenth Amendment.
State auditors also emphasized the need for states to maintain flexibility to responsibly regulate AI, noting that states often serve as first responders to consumer complaints and emerging technology risks.
Alliance of Attorneys General launches Artificial Intelligence Task Force
In November 2025, the Attorneys General Alliance launched a bipartisan Artificial Intelligence Task Force in collaboration with leading AI developers such as OpenAI and Microsoft. The task force, co-chaired by North Carolina Attorney General Jeff Jackson and Utah Attorney General Derek Brown, aims to address emerging AI-related risks while supporting innovation by monitoring and responding to AI developments, identifying emerging AI challenges, and establishing an ongoing forum for developing basic safeguards, especially to protect children.
At its inaugural meeting on January 14, 2026, AG Jackson described AI as a “problem of our time,” highlighting both its significant benefits, such as medical advances, and its risks, such as deepfakes and robocalls. He emphasized that the task force is focused on consumer protection, business innovation, and public safety.
AG Brown noted that while AI offers high benefits, it also comes with high risks, reiterating the need to balance innovation with risk mitigation. He emphasized that state legislatures often have the power to act more quickly than Congress, and in some cases may need to file lawsuits to address damages.
Tania Maestas, AGA’s Deputy Executive Director and General Counsel, facilitated a discussion among participating countries that raised common concerns about child safety, deepfake pornography, privacy, security, and confidentiality. At the same time, states recognized that AI, if deployed responsibly and without harm, has the potential to positively transform the workforce and create business opportunities.
In a media Q&A, the AGs cited federal efforts to preempt state action against AI, arguing that such moves raise constitutional concerns and undermine states’ authority. The co-chairs identified specific priorities, including deepfake pornography, the impact of chatbots on children, and holding big tech companies accountable for harmful content. They also discussed the introduction of AI in offices, noted its increasing use and evolving policies, and expressed serious concerns about candidate deepfakes and their potential impact on elections.
The task force will continue to meet in the future to track emerging AI issues and coordinate timely state-level responses.
II.Consumer protection
Texas secures $1.25 million in settlement in hotel charge concealment case
Texas Attorney General Ken Paxton has secured a $1.25 million settlement with Hyatt Hotels for violating the Texas Consumer Protection Act by advertising room rates without making unavoidable mandatory fees clear to consumers. As part of the settlement, Hyatt must publish all fees upfront so consumers can better compare prices. Paxton emphasized that misleading pricing practices harm Texas travelers and give companies that hide fees an unfair advantage.
New York expands consumer protection law to cover unfair and abusive practices
New York Governor Hochul signed Attorney General Letitia James’s Fair Prices and Integrity through Reasonable Business Practices Act into law, the first major update to the state’s consumer protection law in 45 years.
The new law amends existing deceptive acts and practices statutes by adding “unfair” and “or abusive” to the current law, which only provides for “deceptive acts and practices.”
The new law defines “unfair” as follows:
An act or practice is unfair if it causes or is likely to cause significant harm that cannot be reasonably avoided and has no countervailing benefits to consumers or competition.
The Act defines an act or practice as “abuse” if it:
Significantly interferes with a person’s ability to understand the terms of a product or service, or takes unfair advantage of: a person’s lack of understanding of the material risks, costs, or terms of a product or service, the person’s inability to protect the person’s interests in selecting or litigating a product or service, or the person’s reasonable reliance on another person who engages in acts or practices that act in the dependent person’s interests.
The law makes clear that only the Attorney General can bring allegations of unfair or abusive conduct, and that private conduct remains limited to deceptive conduct. The FAIR Business Act further removes restrictions previously imposed by state courts that limited the attorney general’s law enforcement authority to actions that are “consumer-oriented” or that affect the general public. The new law states that the attorney general is responsible for protecting businesses, nonprofit organizations, and even individual consumers.
Attorney General James said the legislation would strengthen enforcement against hidden fees, unreasonable charges and fraud by lenders, servicers and health care companies, especially as enforcement of federal consumer protections faces uncertainty and suggests increased scrutiny of companies doing business in New York.
As the Trump administration seeks to roll back many regulations, many state agencies are looking to fill regulatory gaps.
The state will challenge the CFPB’s suspension of funding. Court rules funding suspension illegal
A coalition of 21 Democratic state legislatures and the District of Columbia has challenged the Trump administration’s defunding of the Consumer Financial Protection Bureau (CFPB). The complaint alleges that the CFPB’s closure is illegal and could cause “irreparable harm” to consumers’ financial protections. The state auditor’s office argues that the CFPB’s suspension of funding undermines fair loan enforcement, financial product transparency, and protections from unfair practices.
The complaint alleges that the action to defund the CFPB violates the Administrative Procedure Act and that there is no constitutional provision or law that allows the CFPB to refrain from fulfilling its statutory obligations.
In a separate lawsuit brought by the Treasury Employees Union and other private groups, a federal district court issued an opinion and order on December 30, 2025, ruling that it would be illegal for the Trump administration to completely revoke funding to the CFPB, pending the final outcome of the lawsuit. Following this decision, CFPB Acting Chairman Russell Voigt requested $145 million from the Federal Reserve to keep the CFPB adequately funded for the foreseeable future.
III. civil rights
New Jersey adopts disparate impact rule
The New Jersey Division of Civil Rights, under Attorney General Matthew Platkin, has adopted new rules interpreting the New Jersey Anti-Discrimination Act (LAD).
This regulation codifies and clarifies New Jersey’s long-standing approach to disparate impact discrimination under the LAD, formalizing how seemingly neutral practices and policies will be evaluated when they disproportionately harm members of protected classes across employment, housing, public accommodations, financial lending, and contracting contexts.
Under this rule, a disparate impact violation occurs when a facially neutral act results in a material adverse effect on a protected group, unless the covered entity demonstrates that the act is necessary to achieve a substantial, legitimate, nondiscriminatory interest and that there are no less discriminatory alternatives. The framework generally follows a burden-shifting approach that is rooted in existing case law, with regulations that clarify legal standards, burdens of proof, and specific examples to help both individuals and regulated entities understand their compliance obligations.
Importantly, the rule clearly recognizes artificial intelligence and automated decision-making tools as potential sources of disparate impact liability, and signals increased enforcement attention to AI-driven recruitment and selection systems that inadvertently produce biased results.
Other practices that may raise disparate impact concerns include policies related to criminal records, credit or income standards, language or citizenship requirements, and workplace dress or physical standards that disproportionately impact protected groups. Although this regulation does not create any new liability beyond current law, it serves to solidify New Jersey’s civil rights protections as federal disproportionate impact enforcement is curtailed, ensuring that discriminatory impacts remain actionable under state law, regardless of intent.
New consumer protection mandates: state agencies focus on affordability
Connecticut Attorney General William Tong, the newly elected president of the National Association of Attorneys General, announced the president’s initiative, “Reducing Costs for America’s Families” and signaled that affordability is another key issue for state attorneys general.
In addition, the Democratic Attorneys General Association established a Consumer Protection and Affordability Task Force led by Rohit Chopra, former Director of Consumer Financial Protection and former Commissioner of the Federal Trade Commission.
IV. Upcoming State Attorney General Events
DAGA Winter Policy Conference, February 18-19 (San Francisco, CA) AGA Chair’s Initiative February 24-27 (Santa Fe, NM)
View the complete 2026 State Legislature events calendar
(View source.)
