Migliaccio & Rathod LLP is investigating reports that xAI asked employees to provide their personal tax returns as training data for Grok, the company’s AI chatbot, in exchange for a promised $420 payment.
According to Bloomberg News, xAI made the offer earlier this year as the company sought to improve Grok’s tax-related capabilities before the April 15 U.S. tax filing deadline. Bloomberg reported that the offer was discussed in internal company chats and that, approximately two months later, the promised payments had not been made.
This investigation concerns whether xAI employees who provided personal tax-return information were denied promised compensation, whether the terms of the offer were clearly disclosed, and whether employees’ sensitive financial information was adequately protected after submission.
What Consumers Report About xAI
xAI operates Grok, an AI chatbot available through Grok’s web, mobile, and X integrations. The company publicly describes itself as an AI company building Grok and related AI products.
Reports indicate that xAI requested employee tax returns to help train Grok on tax-related tasks. Tax returns contain highly sensitive personal and financial information, including income, deductions, dependents, addresses, Social Security-related information, and other private data. If employees provided this information in reliance on a promised payment, failure to pay may support claims related to unpaid compensation, breach of promise, unjust enrichment, or related state-law wage and contract theories.
The investigation is also examining whether employees were told how their tax returns would be used, who would have access to them, whether the data would be anonymized or retained, and whether employees had any meaningful opportunity to withdraw consent.
Potentially Affected Individuals
Potentially affected individuals may include:
- current or former xAI employees;
- xAI AI tutors, data annotators, or human-data workers;
- employees who submitted personal tax returns to train Grok;
- employees who were promised $420 or another payment for providing tax materials;
- contractors or temporary workers asked to provide tax documents;
- employees who signed arbitration agreements or class-action waivers.
Legal Issues Under Investigation
The firm is investigating whether xAI:
- failed to pay employees promised compensation;
- obtained sensitive tax-return information without adequate disclosure;
- used employee-provided personal financial information for AI training without proper safeguards;
- retained or shared tax-return data beyond what employees understood;
- required employees to sign arbitration agreements affecting their ability to bring claims in court;
- may be subject to mass arbitration if class or collective claims are waived.
Contact
If you worked for xAI and provided your personal tax return or other sensitive financial information after being promised payment, we would like to hear from you. Please complete the contact form on this page, send us an email at [email protected], or give us a call at (202) 470-3520.