Workday, OpenAI, TikTok, and Aurobindo: Litigation Tracker — Week of June 22

At-a-glance docket

Case notes

1. Mobley v. Workday: AI hiring vendor may face California claims

• Parties: Derek Mobley and additional named applicants sue Workday in the Northern District of California. Reuters identifies the case as Mobley v. Workday Inc., No. 3:23-cv-00770. 1
• Claims: The plaintiffs allege Workday's AI-powered hiring tools screened out applicants for discriminatory reasons. The current fight centers on whether California's Fair Employment and Housing Act can apply when Workday screens out-of-state applicants for employers outside California. 1
• Current stage: At a June 16 hearing, U.S. District Judge Rita Lin appeared skeptical of Workday's position and signaled she would likely order the company to face the California claims. 1
• Recent developments: Lin had already ruled in 2024 that Workday could be treated as an employer under federal anti-discrimination laws because it performs screening functions customers would normally conduct themselves. 1
• Business impact: The case is no longer just about one employer's hiring pipeline. If the California theory survives, AI vendors that build and operate screening tools may need state-by-state liability maps, not just customer indemnity language.
• Precedent value: This is the week's most important AI-governance matter because it asks whether the vendor itself can be liable for algorithmic employment decisions, even when the employer makes the final hiring decision.
• Next milestone: Written ruling on Workday's dismissal arguments. The judge did not announce a decision date. 1

2. xAI v. OpenAI: trade-secret claims dismissed with prejudice

• Parties: Elon Musk's xAI sued OpenAI in the Northern District of California over alleged theft of chatbot-related trade secrets. 2
• Claims: xAI alleged that OpenAI induced former xAI engineer Xuechen Li to disclose confidential information related to Grok during recruitment, and that former xAI employees brought source-code and other confidential information to OpenAI. 3
• Current stage: Judge Rita Lin dismissed the case against OpenAI with prejudice on June 15, finding that another amendment would be futile. 2
• Recent developments: Lin held that asking a job candidate to discuss prior work is routine and does not plausibly show inducement to reveal trade secrets. Courthouse News also reported Lin's separate point that "mere possession of trade secrets is not sufficient to constitute misappropriation." 3
• Business impact: AI companies can still sue former employees directly, but this ruling makes claims against the hiring company harder without facts showing inducement, knowledge, or use.
• Precedent value: The order draws a line between aggressive AI talent acquisition and trade-secret theft. For hiring teams, the practical takeaway is documentation: interview protocols should avoid asking for confidential technical specifics, while companies pursuing claims need evidence of conduct by the new employer.
• Next milestone: Appeal rights remain the main path against OpenAI. xAI's separate case against Li continues on a different track; no next date was reported in the June 15 coverage. 2

3. AI.Law v. Eve: legal-AI patent fight moves into court

• Parties: AI.Law sued Butler Labs Inc., doing business as Eve Legal, in the Northern District of California. Reuters lists the case as www.ai.law Corp v. Butler Labs Inc d/b/a Eve Legal, No. 3:26-cv-05930. 4
• Claims: AI.Law alleges Eve infringes a patent covering the use of AI to transform unstructured materials into long-form, properly formatted legal documents. 4
• Current stage: The complaint was filed June 17. Reuters reported that attorney information for Eve was not yet available. 4
• Recent developments: Eve, which sells AI tools to plaintiffs' law firms, was valued at $1 billion last year after backing from investors including Spark Capital and Andreessen Horowitz. 4
• Business impact: Legal-AI vendors have spent the last two years selling speed. Patent litigation may now force them to disclose more about document-generation workflows, claim construction, and product differentiation.
• Precedent value: The case may become an early test of how broad AI-assisted legal-document patents can be against products that all promise similar drafting workflows.
• Next milestone: Eve's response deadline and counsel appearance were not public in the Reuters report. Watch for the answer or an early motion attacking patent eligibility or claim scope.

Self-generated issue map summarizing how this week's AI matters split across vendor liability, trade secrets, and legal-tech patents.

4. Florida v. TikTok: state AG opens a new youth-safety front

• Parties: Florida Attorney General James Uthmeier sued TikTok and parent ByteDance in state court in St. Lucie County, Florida. 5
• Claims: Florida alleges TikTok violates H.B. 3 by allowing children under 14 to create accounts and by misrepresenting the amount of violent or sexual content young users may see. 5
• Current stage: The complaint was filed June 15 and seeks an order requiring TikTok to change its practices, plus financial damages. 5
• Recent developments: TikTok told Reuters it had informed Florida users under 14 that their accounts would be suspended and said it was prepared to defend its minor-safety record. 5
• Business impact: The complaint ties platform safety to account-opening controls, not just content moderation. That is operationally harder for platforms because it points to age assurance, parental-consent flows, and Florida-specific enforcement.
• Precedent value: The case will show whether state consumer-protection enforcers can turn children's social-media laws into affirmative compliance orders against a major platform while constitutional challenges to those laws remain active.
• Next milestone: TikTok's responsive pleading date was not reported. The related fight over Florida's H.B. 3 remains in the appellate pipeline after a federal judge blocked enforcement and that ruling was temporarily halted. 5

5. NetChoice v. Ohio: Sixth Circuit lets parental-consent law take effect

• Parties: NetChoice challenged Ohio's Social Media Parental Notification Act; its members include TikTok, YouTube, Facebook, and Instagram. 6
• Claims: NetChoice argued the law was vague and improperly restricted minors' access to First Amendment-protected content. Ohio defended the law as a parental-consent measure for platforms accessed by children under 16. 6
• Current stage: A divided Sixth Circuit panel overturned the lower-court order that had blocked enforcement and held the law did not violate free-speech protections at this stage. 6
• Recent developments: Judge Eric Clay wrote that the act imposes a parental-consent requirement and places a marginal burden aimed at children's unsupervised assent to platform terms and conditions. 6
• Business impact: Platforms now face a live compliance problem in Ohio, not only a litigation risk. The law requires covered operators to verify age and obtain parental consent for users under 16. 6
• Precedent value: The decision gives states a defense template: frame the law as consent and contract oversight rather than direct content regulation. The split with other platform-law challenges will matter if this reaches the Supreme Court.
• Next milestone: NetChoice said it remains confident the law will be struck down permanently, but Reuters did not report a specific rehearing or Supreme Court schedule. 6

Self-generated issue map summarizing the two platform youth-safety matters covered above.

6. FTC review of Aurobindo / Lannett: four-drug divestiture in a generic-pharma deal

• Parties: The FTC issued a complaint and proposed consent agreement covering Aurobindo Pharma's $250 million acquisition of Lannett Company. 7
• Claims: The agency alleged the deal would combine two of a limited number of competitors in four generic-drug markets and could eliminate competition or reduce independent competitors for those products. 7
• Current stage: Under the proposed order, Aurobindo must divest four products to Quagen Pharmaceuticals and Aurobindo and Lannett must provide transition services; a monitor will oversee compliance. 7
• Recent developments: The divested products include mycophenolate mofetil oral suspension, niacin extended-release tablets, pilocarpine tablets, and rabeprazole sodium delayed-release tablets. 7
• Business impact: The order is targeted, but it matters for generic-drug M&A because the agency did not need a mega-merger to intervene. A narrow overlap in medicines used for organ transplant rejection, cholesterol management, radiation-related dry mouth, and acid reduction was enough. 8
• Precedent value: Generic-drug acquirers should expect product-by-product market analysis and a credible divestiture buyer before closing. The FTC's remedy also shows continued reliance on transition services and monitors in pharma competition settlements.
• Next milestone: The proposed consent agreement is open for 30 days of public comment after a 2-0 Commission vote. 7

Watch points for the next cycle

Self-generated issue map summarizing the remedy structure in the Aurobindo / Lannett matter discussed above.