Weekly news roundup: Legal trouble for Google, New York pauses data centers and Muse Image retreat

This week in tech saw legal trouble for Meta, Google and the data center industry. Meta scaled back Muse Image capabilities following user backlash and then faced a lawsuit alleging it used AI to help make layoff decisions. Google is also feeling heat as a group of major book publishers brought fresh copyright claims. Meanwhile, New York became the first U.S. state to pause the construction of new large-scale data centers. Here's what you need to know from the week starting July 13, plus the latest updates in IPOs and executive leadership. Meta retreats on Muse Image Meta found itself on the defensive just a week after unveiling Muse Image, its new AI image-generation tool. Following a wave of criticism from users, the company removed one of the feature's most controversial capabilities. Muse Image, developed by Meta Superintelligence Labs, allows users to generate and edit images using AI. Users complained that the tool incorporates photos from public Instagram accounts unless account holders disable the feature. Meta listened to the complaints and updated their product launch blog post . “Our intent was to provide a useful creative tool and to give people control over whether their public content could be referenced in this way,” Meta wrote. “We’ve heard the feedback that this feature missed the mark, so it’s no longer available.” As organizations continue to deploy sophisticated generative AI tools, ethical practices and transparency are becoming just as important as technical capability. Meta sued over AI-led layoff decisions Artificial intelligence in the workplace is common across the world for recruitment and employee support. Meta has allegedly taken this one step further, using AI to determine which employees face redundancy. Meta is facing a federal lawsuit from 26 current and former employees who claim the company relied on AI-driven metrics when selecting staff for layoffs, unfairly affecting workers who had taken medical or family leave. The plaintiffs are seeking financial compensation, back pay and potentially reinstatement. Meta denies that AI made layoff decisions, insisting that humans made the final calls. But the case raises important questions about how automated decision-making is being used within the workplace and broader workplace AI governance. New York puts the brakes on AI data centers The data center industry is facing public backlash across the country, but this week encountered its biggest political obstacle yet. New York became the first U.S. state to introduce a one-year moratorium on the construction of new data centers. Governor Kathy Hochul's executive order pauses new facilities consuming 50 megawatts or more while the state develops stronger regulations and guardrails. The executive order also paves the way for environmental impact reports and new energy transparency standards . The decision has sparked criticism, notably from President Donald Trump who wrote in a Truth Social post that, “One of the biggest Driving Forces in the Future for Jobs, are Data Centers,” and that “New York should change its Policy, IMMEDIATELY.” However, New York is not the only state to consider a pause on data centers. Maine approved a moratorium, though its governor vetoed the decision. Other states that have proposed moratoriums include Minnesota, New Hampshire and Oklahoma. More than a dozen states have proposed similar legislation to New York. Book publishers take Google to court A group of major publishers filed a lawsuit accusing Google of using copyrighted books to train its Gemini AI models without permission. The publishers -- Hachette Book Group, Cengage Learning and Elsevier, along with author Scott Turow -- claim that Google took advantage of its access to books through services like Google Play Books and Google Scholar to train Google Gemini without consent. Historically, courts have sided with AI companies in similar instances, finding that companies using content to train AI models came under “fair use” under U.S. copyright law. Executive moves Tom Blomfield. Former Monzo CEO Tom Blomfield has been recruited by AI company Anthropic to join its AI research team, effective immediately. Kyle Roche. Kyle Roche was appointed as chief AI officer at Foundry, a creative software development company. Roche was formerly CEO at Griptape. Matthew Mengerink. Fintech company, Jiko, appointed author and previous Uber vice president, Matthew Mengerink as their new CTO. IPO watch The U.S. IPO market remains a key indicator of broader tech sentiment. Here's a look at the latest listings and activity from the past week, based on data from the Nasdaq IPO calendar: Research Alliance Corp. IV A special purpose acquisition company. Opening/trading day: July 13. IPO price: $10/share. Jones Ventures INTL Acquisition1 Corp. A blank check company. Opening/trading day: July 14. IPO price: $10/share. QumulusAI, Inc. AI and cloud infrastructure company. Expected opening/trading day: July 16. IPO price: TBC. Standard Nuclear, Inc. Nuclear fuel manufacturer. Expected pening/trading day: July 16. IPO price: $15/share. MetaOptics Ltd. A semiconductor optics company. Expected opening/trading day: July 16. IPO price: $5-7/share. Csquare, Inc. A fintech company. Expected opening/trading day: July 16. IPO price: $21/share. Southern Cross Acquisition I Corp. A blank check company. Expected opening/trading day: July 17. IPO price: $10/share. Market Technology Acquisition Corp. A blank check company. Expected opening/trading day: July 17. IPO price: $10/share. Rosa Heaton is a content manager and writer for the IT Strategy team at TechTarget.