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Legal News for Tues 11/4 - SBF Appeal, Getty Loses to Stability AI, PA Rushes Regulations for "Skill Games" to Avoid Higher Tax
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Legal News for Tues 11/4 - SBF Appeal, Getty Loses to Stability AI, PA Rushes Regulations for "Skill Games" to Avoid Higher Tax

Sam Bankman-Fried’s appeal, Getty’s partial UK loss to Stability AI, and Pennsylvania’s rushed regulation of so-called “skill games.”

This Day in Legal History: Massachusetts Institutes Death Penalty for Heresy

On November 4, 1646, the Massachusetts General Court enacted a law that imposed the death penalty for heresy, marking one of the most extreme expressions of religious intolerance in early American colonial history. The law required all members of the colony to affirm the Bible as the true and authoritative Word of God. Failure to do so was not merely frowned upon—it was made a capital offense. This legislation reflected the theocratic underpinnings of the Massachusetts Bay Colony, which had been established by Puritans seeking religious freedom for themselves but not necessarily for others.

The Puritan leadership equated dissent with disorder, and heresy with treason against divine authority. The law was aimed particularly at groups such as Quakers, Baptists, and others who challenged orthodox Puritan theology. While it is unclear whether anyone was actually executed under this specific statute, it laid the foundation for later persecution, including the execution of Mary Dyer, a Quaker, in 1660. The law exemplifies how early colonial governments wielded both civil and religious authority in tandem.

It also foreshadows the centuries-long struggle in American legal and cultural history to define the boundaries between church and state. Though the U.S. Constitution would later enshrine religious freedom in the First Amendment, this 1646 law demonstrates how precarious that freedom was in earlier periods. The harshness of the law also underscores the broader context of 17th-century Europe and its colonies, where religious uniformity was often enforced through state power. Massachusetts would gradually shift away from such punishments, but not without considerable resistance.


Sam Bankman-Fried’s legal team will argue before the 2nd U.S. Circuit Court of Appeals that his conviction for defrauding FTX customers should be overturned. The 33-year-old former crypto executive is currently serving a 25-year sentence after being found guilty in 2023 of stealing $8 billion from FTX users. His lawyers claim the trial judge unfairly excluded key evidence—specifically, information supporting Bankman-Fried’s belief that FTX had sufficient assets to cover customer withdrawals. Prosecutors counter that the evidence against him, including internal records and testimony from former associates, was overwhelming.

Bankman-Fried was once considered a leading figure in the crypto space, known for his high-profile donations and media presence before his downfall. During the trial, former executives at FTX and Alameda Research testified that he instructed them to misuse customer funds to cover hedge fund losses. He was convicted of two fraud counts and five conspiracy charges. Judge Lewis Kaplan, who sentenced him in March 2024, said Bankman-Fried knowingly acted criminally but underestimated the risk of detection. There are also unconfirmed reports that some in his circle are lobbying Donald Trump for a pardon, though Trump has not commented. Bankman-Fried is currently incarcerated at a low-security facility in California and is expected to be released in 2044.

Sam Bankman-Fried’s lawyers to argue for new fraud trial for FTX founder | Reuters


Getty Images has largely lost its high-profile UK lawsuit against Stability AI, the company behind the image-generating tool Stable Diffusion. Getty had accused Stability AI of copyright infringement, claiming the AI system was trained on millions of its images without permission. However, Getty dropped the core part of the case mid-trial due to insufficient evidence about where and how the AI was trained, leaving that central legal question unresolved. The remaining claims focused on trademark infringement and secondary copyright violations.

The High Court ruled that Getty partially succeeded on the trademark issue, noting Stable Diffusion sometimes generated images that included Getty’s watermark. But the judge emphasized that this finding was historically narrow and of limited scope. Getty’s broader copyright claim was dismissed, with the court finding that Stable Diffusion does not store or directly reproduce copyrighted works. Legal experts called the ruling disappointing for copyright holders and warned it exposed gaps in UK intellectual property protections regarding AI.

Both companies claimed aspects of victory: Getty pointed to the trademark ruling and the recognition that AI models can be subject to IP laws, while Stability AI emphasized that the decision effectively cleared the core copyright concerns. Getty warned the decision highlights the difficulty even well-funded companies face in protecting creative works and urged governments to strengthen transparency rules around AI training data. Legal analysts say the ruling leaves a major legal question unresolved—whether training AI on copyrighted content without consent constitutes infringement under UK law.

Getty Images largely loses landmark UK lawsuit over AI image generator | Reuters


Pennsylvania lawmakers are advancing a regulatory and fee-based proposal targeting “skill games”—arcade-style gambling machines—without first resolving the legal and oversight framework surrounding them. Senate Bill 1079, introduced by Senators Gene Yaw and Anthony Williams, proposes a $500 monthly fee per machine, capped at 50,000 terminals, potentially raising $300 million annually. However, I argue that this revenue-driven approach puts fiscal goals ahead of sound regulation. The bill includes some regulatory provisions like machine limits, ID checks, and a centralized monitoring system, but these appear to have been crafted after the fee structure, not as foundational policy.

Skill games have operated in a legal gray area since a 2023 court ruling found they don’t meet the state’s definition of gambling devices. That ambiguity has persisted, leaving the machines largely unregulated but widespread. Instead of clarifying the legal status of these machines and building a regulatory framework first, lawmakers now seem focused on monetizing them quickly—potentially to preempt a stricter tax plan proposed by Governor Shapiro. The bill notably keeps enforcement under the Department of Revenue rather than the more experienced Gaming Control Board, raising questions about effective oversight.

This structure may incentivize the rapid deployment of machines to meet revenue goals, risking poor compliance and ineffective safeguards. In sum, I go on to say the proposal uses regulation to justify revenue collection, rather than using revenue to support a robust regulatory system. Without a clear legal definition, licensing process, and proper enforcement authority, the current plan prioritizes money over governance.

Pennsylvania Skill Game Fee Regulations Have Questionable Timing