Federal Court Rules AI-Generated Child Abuse Images Protected

Court dismisses possession charge in Wisconsin AI case

A federal appeals court has upheld the dismissal of a possession charge against a Wisconsin man accused of creating thousands of explicit AI-generated images depicting children, ruling that such possession falls under First Amendment protection.

The decision affects the case of Steven Anderegg, 42, who was arrested in 2024 after prosecutors say he used artificial intelligence to create thousands of "photorealistic" abuse images. While a federal judge in Wisconsin initially dismissed the possession charge, the appeals court affirmed that decision last week.

Judge John Z. Lee grounded the ruling in Supreme Court precedents from 1969 and 2002, noting that the images do not depict actual children and that established case law protects the right to possess obscene material in one's home. "Given the relentless advancement in artificial intelligence... we have some concerns about the lines these cases draw, but we are not free to redraw them ourselves," Lee wrote in the opinion.

Why it matters

This ruling creates a legal distinction between possessing AI-generated child abuse material and producing or distributing it, potentially complicating law enforcement efforts as generative AI tools become more accessible. The decision highlights a gap between rapidly evolving technology and existing legal frameworks designed before such synthetic content was possible.

Remaining charges still stand

Anderegg continues to face three other federal charges: producing the AI-generated images, distributing them, and sending them to a minor. According to prosecutors, Anderegg allegedly sent some of the images to a 15-year-old boy and explained his AI creation process.

These charges remain unaffected by the appeals court decision, which addressed only the possession count.

Advocates express concern over community impact

Katelyn Wonderlin, sexual assault program director with Bolton Refuge House, said the ruling surprised and concerned her organization. "It creates a lot of vulnerabilities in our community," Wonderlin said. "It also contributes to a community consciousness or community belief that it is allowable to have child sex abuse materials."

Wonderlin emphasized that synthetic images can still enable real harm, including blackmail and extortion of children. "People who are going to hurt another person will use whatever method that they can," she noted.

She urged community members to engage with legislators about updating laws to address technology-enabled abuse. "It's really important for the community to see where these new laws are harmful and to talk to their legislators and to talk to their community leaders about how we're going to go forward to better protect the most vulnerable people in our society, which is children and youth," Wonderlin said.

The case details were first reported by WEAU in Eau Claire, Wisconsin.