Elon Musk-owned company xAI has filed a lawsuit against a user, South Carolina man Terry Hardwood, accusing him of using its chatbot Grok to create child sex abuse materials. The lawsuit alleges Hardwood violated the chatbot's terms of service by creating sexually explicit images without the subject's consent. Grok's main data centers, the Colossus and Colossus II supercomputers, are located in Memphis. Hardwood was arrested earlier in 2026 in South Carolina. This is one of the first lawsuits filed by a tech company against a user.