Weekly News Roundup: OpenAI launch, AI lawsuits and frameworks and Pentagon AI alliances

Apple settlement signals rising AI accountability risks

Apple agreed to settle a class action lawsuit this week and could pay some iPhone buyers up to $95 over allegations that the company overstated and misled customers about new AI capabilities and functionality.

Lawyers claimed that ads promising Apple Intelligence and an enhanced Siri on the iPhone 16 were false and amounted to false advertising. In the settlement on May 5th, Apple denied the lawsuit's allegations but agreed to a deal to resolve claims.

The case highlights the increasing legal and regulatory scrutiny facing vendors marketing generative AI functionality.

Big Tech opens AI models for government testing

On Tuesday, May 5, the National Institute of Standards and Technology announced that Microsoft, Google and xAI have agreed to allow the U.S. government to evaluate and test advanced AI models before public release.

The initiative is designed to assess national security and cybersecurity risks before models become accessible to consumers and signals a new phase in AI regulation.

The deal follows cybersecurity concerns around Anthropic’s powerful Claude and the company's decision not to allow the Pentagon access to its AI models.

For CIOs, this news signals increased compliance requirements as governments move to establish clearer AI governance frameworks.

Pentagon deepens AI push with Big Tech alliances

The Pentagon expanded its AI partnerships with eight major technology companies, including Microsoft, Google, OpenAI and NVIDIA, to accelerate deployment of AI across defence and intelligence operations.

Anthropic was notably absent from the agreements, following Anthropic’s decision to decline the government’s request to use its AI models. This deal underscores the growing competition over who shapes the future of government AI infrastructure.

The Pentagon said that this agreement will "accelerate the transformation toward establishing the United States military as an AI-first fighting force."

OpenAI releases GPT-5.5 Instant

OpenAI launched GPT-5.5 Instant as the new default model powering ChatGPT, promising faster response times, improved reasoning and lower operational costs. OpenAI claims that the new model also reduces hallucination in high-stake areas such as medicine, finance and law.

The model scored 81.2 in the AIME math test -- a prestigious math competition that tests mathematical problem solving -- compared to 65.4 for the company’s older model.

AI platforms are evolving quickly and OpenAI claims that it's new model promises accuracy, low latency and stronger knowledge work. This update demonstrates how quickly AI models must evolve to keep up with consumer demand.

Coinbase and Cloudflare cut staff

Coinbase is cutting approximately 14% of its workforce -- becoming the latest tech company to face layoffs -- as it responds to continued volatility across both the cryptocurrency and AI markets. The company cited the need to streamline operations and rebalance investment priorities amid shifting market conditions and rising costs.

Coinbase CEO Brian Armstrong shared the staff email on X which said “we are not just reducing headcount and cutting costs, we’re fundamentally changing how we operate: rebuilding Coinbase as an intelligence, with humans around the edge aligning it.”

In a blog post released on May 7, Cloudflare announced a layoff of over 1,100 employees globally. “We have to be intentional in how we architect our company for the agentic AI era,” the blog post says, “we are reimagining every internal process, team, and role across the company.”

The Coinbase and Cloudflare layoffs are another example of tech companies facing pressure to balance investment with operational efficiency and AI.

Executive moves

• Rishad Sadikot. On May 5, Tufts University appointed Rishad Sadikot as its new CIO. Sadikot was previously managing director at Cambridge Associates. Sadikot is a Tufts University alumnus and will oversee the university's investment strategy.
• Pushkar Ranade. Intel named Pushkar Ranade as chief technology officer after five months of holding the position at interim level.
• Javed Khan. Video technology company Neat named Javed Khan as CEO, as the company deepens its investment in AI.

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:

Rare Earths Americas, Inc.

• Exploration-stage mining company.
• Opening/trading day: May 6.
• IPO price: $19/share.

Vernal Capital Acquisition Corp.

• A blank check company.
• Opening/trading day: May 6.
• IPO price: $10/share.

HawkEye 360, Inc.

• A defense technology company.
• Expected opening/trading day: May 7.
• IPO price: $24-26/share.

Shreya Acquisition Group

• A blank check company focusing on businesses in the health and wellness, hospitality, media and infrastructure sectors.
• Expected opening/trading day: May 7.
• IPO price: $10/share.

Suja Life, Inc.

• Manufacturer and marketer of plant-based beverages.
• Expected opening/trading day: May 7.
• IPO price: $21-24/share.

Odyssey Therapeutics, Inc.

• A clinical-stage biotechnology company.
• Expected opening/trading day: May 8.
• IPO price: $16-18/share.

Mobia Medical, Inc.

• A commercial-stage medical device company.
• Expected opening/trading day: May 8.
• IPO price: $14-16/share.

Rosa Heaton is a content manager and writer for the IT Strategy team at TechTarget.