Federal Appeals Court Rules on AI-Generated Child Sexual Abuse Material

<p>A federal appeals court has ruled that the First Amendment protects the private possession of AI-generated child sexual abuse material (CSAM), provided that the images do not depict real children. This decision highlights a gap between established Supreme Court precedent and current developments in artificial intelligence.</p><p>The 7th U.S. Circuit Court of Appeals ruled on August 29, 2026, that the government cannot prosecute Steven Anderegg for possessing AI-generated images depicting children engaged in sexually explicit conduct, as Supreme Court precedent protects the private possession of such material.</p><p>Two judges on the panel expressed concern about the implications of this ruling, acknowledging the challenges posed by advancements in AI technology. Judge John Lee stated, "We now live in an age where GenAI models can render images depicting the abuse of virtual children that are virtually indistinguishable from those depicting the abuse of actual children." He noted that while they have concerns about the implications, they are bound by existing precedent.</p><p>The ruling stems from the prosecution of Anderegg, a Wisconsin man accused of using an AI image generator to create thousands of sexually explicit images depicting children. The investigation began after Meta, the parent company of Instagram, reported to the National Center for Missing and Exploited Children that an Instagram user had sent apparent AI-generated CSAM to a minor's account. Anderegg faced charges for producing and distributing the material, transferring it to a minor under 16, and possessing it.</p><p>A federal district court dismissed the possession charge, concluding that prosecuting Anderegg for privately possessing the AI-generated images violated the First Amendment. The Justice Department appealed this decision to the 7th Circuit, which upheld the dismissal.</p><p>Importantly, the court's decision does not imply that all of Anderegg's actions are protected by the First Amendment. The charges related to the production and distribution of the material, as well as allegedly sending it to a 15-year-old boy, are still pending.</p><p>The court emphasized a legal distinction: while the government can prosecute conduct related to the creation or distribution of AI-generated CSAM, once the material is privately possessed, existing Supreme Court precedent prevents criminalization of that possession.</p><p>The legal foundation for this ruling dates back to 1969, when the Supreme Court ruled in Stanley v. Georgia that the government generally could not criminalize an individual's private possession of obscene material in their home. In 2002, the Supreme Court addressed virtual child pornography in Ashcroft v. Free Speech Coalition, striking down parts of a federal law prohibiting sexually explicit depictions of fictional children when no actual child was involved in their production.</p><p>The Supreme Court reasoned that the justification for prohibiting child pornography—protecting children from exploitation—did not apply when no real child was involved. The 7th Circuit noted that this distinction has become increasingly difficult to maintain, as the technology available today was likely unimaginable at the time of the earlier rulings.</p><p>The court also referenced emerging evidence suggesting that AI-generated CSAM may not be entirely disconnected from the exploitation of real children. Judge Lee pointed out that researchers have found CSAM in datasets used to train image-generation models, raising concerns about the potential connection between virtual material and real-world abuse. However, this issue was not fully developed in Anderegg's appeal.</p><p>The 7th Circuit's opinion echoed a warning made by Supreme Court Justice Clarence Thomas in 2002, who cautioned that technological advances could complicate the enforcement of laws against child pornography involving actual victims if virtual images became sufficiently realistic. Judge Lee concluded by stating that according to some experts, that day may have arrived, citing the increasing volume of AI-generated material reported to the CyberTipline and the challenges it poses for law enforcement.</p><p>The judges ultimately decided that it is not their role to overrule or rewrite Supreme Court precedent. Judge Lee remarked, "The stakes are high, and we must be mindful of the ever-accelerating advancements in image generation technology." The decision leaves the matter for the Supreme Court to address.</p>