1. Hendrix v. Apple - MAJOR NEW CASE ALERT!
Current Status: Another group of authors take a bite at Apple — the first AI copyright infringement case against Tim Cook and his Cupertino crew! Last week saw the filing of another class action lawsuit by book authors against companies developing LLM-based tools. This case targets Apple for work that it has done training its family of OpenELM models, which are hosted on HuggingFace and which Apple has discussed in published papers. The Plaintiffs in this class allege similar theories to those in prior cases: that the training of the OpenELM models was based on illicitly obtained books from the books3 database. Their complaint alleged only one cause of action: direct copyright infringement under 17 U.S.C. § 501. Check back in the coming weeks as this new matter develops.
2. Bartz v. Anthropic
Current Status: Anthropic chooses to pay the largest known copyright settlement in history — but so far, the Court won’t let them! A few weeks ago, we saw that the Bartz plaintiffs (book authors and rights-holders) and Anthropic had reached a proposed settlement of $1.5 Billion. There are roughly 500,000 copyrighted works subject to the settlement, resulting is about $3,000 per work. Although this is certainly an historic and watershed moment in AI training litigation, we need to put it in context. But last week, Judge Alsup refused to approve the settlement. The Judge instead demanded more information about the settlement. So will it happen? Won’t it? Stay tuned for more.
But recall that Judge Alsup’s summary judgment ruling didn’t fault Anthropic for training its AI on copyrighted works. Rather, Alsup found that pirating copyrighted works to create a general-purpose digital library for Anthropic to use however it wanted was not “fair use.” In another case decided that same week several weeks ago, Judge Vince Chhabria (in the same federal district) ruled that Meta’s acquisition of copyrighted materials through torrenting was not copyright infringement because the purpose of the acquisition was to train an AI system, which both Chhabria and Alsup found to be fair use. According to Alsup, Anthropic’s violation here is not training its AI, but taking hundreds of thousands of copyrighted works for whatever purpose it wanted. Arguably, if Anthropic had simply purchased the copyrighted works (likely for far less than $3,000 a copy) it would have been clear to train its AI however it chose — although, to be clear, Judge Chhabria would likely reach a different result.
3. Warner Bros. Discovery v. Midjourney
Current Status: Warner Bros. Discovery joins the fight against Midjourney! On September 4th, Warner Bros. Discovery sued Midjourney in the United States District Court for the Central District of California alleging direct and secondary copyright infringement. The complaint is similar in many ways to Disney and Universal’s showing dozens of strikingly similar images where Midjourney’s outputs mimic Warner Bros. copyrighted characters. The fact that Warner Bros. also picked Midjourney as a sole target speaks volumes about Midjourney’s uniquely dismissive attitude towards copyright and generative AI.
The next step will be for Midjourney to file an answer or other responsive pleading. We expect an answer from Midjourney will track the answer in the case against Disney and Universal, claiming fair use and that it does not control what its users create.
Three of the “Big Five” studios have now sued Midjourney, leaving only Sony and Paramount on the sidelines. We will see if they follow suit.
4. Concord Music Group, et al. v. Anthropic
Background: UMG, Concord Music and several other major music companies sued Amazon-backed OpenAI competitor Anthropic on October 18th, 2023 in the U.S. District Court (Middle District of Tennessee). The music companies assert that Anthropic is infringing their music lyric copyrights on a massive scale by scraping the entire web to train its AI, essentially sucking up their copyrighted lyrics into its vortex – all without any licensing, consent or payment. In its response, Anthropic claimed fair use. The case was transferred to the Northern District of California on June 26th, 2024 and closed in Tennessee. The judge assigned is Judge Eumi K. Lee. The parties have not yet had a case management conference.
Current Status: The dispute over adding Bartz claims continues. As we discussed previously, Plaintiffs have attempted to amend their complaint to add claims directed to torrenting activities like those that prompted Anthropic to enter into a $1.5 billion settlement agreement in Bartz v. Anthropic. Last week, Plaintiffs submitted their reply brief supporting their motion to amend in which they argued that any delay in bringing these claims was attributable to discovery failures by Anthropic. The parties also submitted a joint discovery dispute statement regarding what Anthropic has called deficient damages disclosures by Plaintiffs.
5. Kadrey et al. v. Meta
Background: Author Richard Kadrey, comedian Silverman, and others sued Mark Zuckerberg’s Meta on July 7, 2023 in the U.S. District Court (Northern District of California) for mass infringement - i.e., unlicensed “training” of their generative AI model on millions of copyrighted works, including their own. Meta’s defense is “fair use.” The judge assigned is Judge Vince Chhabria.
At first, in November 2023, the Court dismissed the bulk of plaintiffs’ claims against Meta. But the Court gave plaintiffs a chance to amend their complaint to add a more direct link to actual harm - and they filed their amended complaint in December 2023.
Current Status: Judge Chhabria charts a course to summary judgment on copying and uploading of books. In the aftermath of Meta’s success on summary judgment regarding the use of books as training data, Plaintiffs have continued to litigate issues related to the distribution of pirated books by Meta in the course of torrenting them. Two weeks ago, the parties managed to agree on an expert discovery schedule, though they were unable to agree on a schedule for summary judgment briefing. This past Friday, Judge Chhabria adopted the parties’ proposed deadlines and set summary judgment briefing to begin about a week later, with the hearing set for February 12th next year.
6. SDNY Multi-District Litigation
Background: Federal Judge Stein (Southern District of New York) is the multi-district litigation (MDL) judge for twelve high-profile generative AI cases. On April 3rd, the MDL panel consolidated the following cases for pretrial proceedings:
1. TREMBLAY, ET AL. v. OPENAI, INC., ET AL., C.A. No. 3:23−03223
2. SILVERMAN, ET AL. v. OPENAI, INC., ET AL., C.A. No. 3:23−03416
3. CHABON, ET AL. v. OPENAI, INC., ET AL., C.A. No. 3:23−04625
4. MILLETTE v. OPENAI, INC., ET AL., C.A. No. 5:24−04710Southern District of New York
5. AUTHORS GUILD, ET AL. v. OPENAI, INC., ET AL., C.A. No. 1:23−08292
6. ALTER, ET AL. v. OPENAI, INC., ET AL., C.A. No. 1:23−10211
7. THE NEW YORK TIMES COMPANY v. MICROSOFT CORPORATION, ET AL.,C.A. No. 1:23−11195
8. BASBANES, ET AL. v. MICROSOFT CORPORATION, ET AL., C.A. No. 1:24−00084
9. RAW STORY MEDIA, INC., ET AL. v. OPENAI, INC., ET AL., C.A No. 1:24−01514*
10. THE INTERCEPT MEDIA, INC. v. OPENAI, INC., ET AL., C.A. No. 1:24−01515
11. DAILY NEWS LP, ET AL. v. MICROSOFT CORPORATION, ET AL.,C.A. No. 1:24−03285
12. THE CENTER FOR INVESTIGATIVE REPORTING, INC. v. OPENAI, INC., ET AL.,C.A. No. 1:24−04872
DENIAL v. OPENAI, INC, MICROSOFT CORPORATION
Current Status: Denial stayed and discovery letter briefs galore. This week, the Denial Plaintiffs, OpenAI, and Microsoft submitted a joint stipulation to stay their case during the pendency of the multi-district litigation. The Court adopted their stipulation and proposed order.
The start of depositions by the News Plaintiffs this week brought a slew of discovery dispute letters to the Court (some courts use a simple letter instead of formal briefs to resolve basic discovery issues). Among these letters were motions by OpenAI and Microsoft to compel various Plaintiffs to produce documents relating to their allegations of market harm. The News Plaintiffs also submitted letters asking that the Court facilitate discovery into documents on which Defendants might rely for their affirmative defenses as well as for copies of Common Crawl documents craped from Plaintiffs’ websites. The News Plaintiffs additionally submitted a letter brief seeking documents related to so-called “pink-slime entities’” reliance on OpenAI’s tools to produce AI-generated and misinformation-laden news articles. Ziff Davis also got involved, submitting a letter brief asking that OpenAI be compelled to identify custodians and search terms for ESI discovery and alleging that OpenAI was withholding discovery pending its motion to stay. Several more letter briefs were so heavily redacted that we had trouble figuring out what they were trying to accomplish.
It seems likely that the parties will resolve many of these disputes without the need for court intervention. In fact, by the end of the week the parties had already resolved he “pink slime entities” dispute on which the News Plaintiffs moved earlier in the week. Check back soon as depositions continue to ramp up.
7. The New York Times v. Microsoft & OpenAI
Background: On December 27, 2023, The New York Times sued Microsoft and OpenAI in the U.S. District Court for the Southern District of New York for copyright infringement and other related claims. The Times alleges that the companies used “millions” of its copyrighted articles to train their AI models without its consent. The Times claims this has resulted in economic harm by pulling users away from their paywalled content and impacting advertising revenue. The complaint alleges several causes of action, including copyright infringement, unfair competition, and trademark dilution. In its pleadings, The Times asserts that Microsoft and OpenAI are building a “market substitute” for its news and further that their AI generates “hallucinations” based on The Times’ articles also substantially damage its reputation and brand. The Times seeks “billions of dollars of statutory and actual damages.” Microsoft and OpenAI assert the defense of “fair use” - i.e., no license, payment or consent is needed.
On September 13, 2024, the Court granted a motion to consolidate the case with another brought by the Daily News and other publications (see the MDL discussion above in Summary 1). The judge assigned to the consolidated cases is Judge Sidney Stein.
Current Status: OpenAI objects to preservation order. As we discussed previously, the Court has maintained its order for OpenAI to preserve chat logs that would otherwise be deleted under its privacy policies, citing concerns that the same users who might use ChatGPT to circumvent The New York Times’ paywall protections would be more likely to request deletion of their chat logs. OpenAI has maintained its objections to this order.
In its Objection to Preservation Order, OpenAI raised three main arguments. First, that the preservation order does not serve a useful purpose because the idea that certain users attempt to “cover their tracks” is far-fetched. Second, they argued that the Order is not proportional to the needs of the case, because it would require OpenAI to make infrastructural changes to support the retention and would strain user trust in OpenAI. Finally, OpenAI argued that the preservation order was based on false premises, stating that OpenAI did not “destroy” any data, and certainly did not delete any data in response to litigation events.
OpenAI’s false-premises argument cites support from a non-public declaration, but it appears that OpenAI may be relying on a narrow distinction between “deleting” data (which it is arguing is needed to maintain customer trust) and “destroying” data which the News Plaintiffs could argue gives rise to adverse inference.
8. Disney & Universal v. Midjourney
Background: Disney and Universal filed suit for copyright infringement against Midjourney, an AI image generation platform. This case is unique because, although the AI litigation battlefield has seen major plaintiffs in news media entities such as The New York Times, so far no major traditional Hollywood studio has entered the fray. Disney and Universal are alleging straightforward claims of direct and secondary copyright infringement based on Midjourney’s unlicensed use of copyrighted works for training its models, which lead to an ability to generate the unlicensed likeness of the Plaintiffs’ characters.
The copyright infringement in Disney and Universal’s complaint also stands out from that alleged by author and news plaintiffs in other cases because it relies on what could be considered “normal use” of the Midjourney product. The complaint is filled with examples of images depicting Marvel, Star Wars, and DreamWorks characters. These images were not generated in response to prompts crafted by attorneys preparing the complaint — they were generated by normal Midjourney users who wanted to see what Shrek would look like as a 1950s greaser, as an example.
The complaint incorporates all of the grievances we have already seen from other plaintiffs, such as the use of copyrighted material for training and the generation of works that seem to mirror copyrighted training data. However, Disney and Universal are uniquely positioned to argue that Midjourney is engaged in and profiting from the massive distribution of works that infringe their copyrights. The facts, combined with Disney’s behemoth status in the media industry, will likely lead to unique dynamics not seen in the other cases.
Current Status: No major substantive developments this past week. As we reported two weeks ago, the most recent movement was Midjourney’s answer where Midjourney likened the process of training an LLM to the process of a human being learning, echoing the reasoning underlying the fair use defenses of other AI companies. At the same time, Midjourney described its product as a tool used by artists. Midjourney suggested that, to the extent that any produced images infringed Disney’s copyrights, they were only created at the instruction of its users. Midjourney raised a particularly interesting affirmative defense: unclean hands. Apparently Disney’s own purported use of training an AI model on copyrighted works precludes Disney from enforcing its own copyrights. We suspect that the unclean hands defense may be more marketing than lawyering, but we’ll see.
9. Thomson Reuters v. Ross Intelligence
Background: On February 11th, 2025, in a case that comes tantalizingly close to deciding the issue of “fair use” in generative AI model training (with many taking the position that now that issue is firmly decided, as laid out below), Circuit Judge Bibas of the District of Delaware ruled that the “fair use” doctrine does not protect the use of West Headnotes in determining what to display as a result of a user query. Thomson Reuters v. Ross Intelligence involves an AI search tool made by the now-defunct Ross Intelligence (“Ross”). Ross’ tool accepted user queries on legal questions and responded with relevant case law. To determine what cases to provide in response to user queries, Ross compared the user queries to “Bulk Memos” from LegalEase, which were written using Westlaw Headnotes. Boiling it down, when a user’s query contained language similar to a West Headnote, Ross’ tool would respond by providing the cases that the West Headnote related to.
While Ross’s tool was not a modern generative AI model (it didn’t use a transformer model or perform next-token prediction to generate unique output for queries), an important similarity exists between Ross’ use of West Headnotes and the way generative AI models train on other copyrighted materials. Ross’ tool did not actually reproduce the West Headnotes in response to a user’s query. Ross used the Headnotes just for “training,” that is, to determine what to produce in response to a user's query. It is easy to draw an analogy between Ross’ use of West Headnotes to determine what cases are responsive to a user’s query, and OpenAI’s use of The New York Times articles to determine how to respond to a question about politics (see the separate The New York Times case against OpenAI summary below). The technology is different, but the themes are similar.
In that context, the Court’s grant of summary judgment against Ross’ fair-use defense — as a matter of law — provides insight into how another court might rule in a generative AI training case. “Fair use” is based on four factors: (1) the purpose and character of the use, (2) the nature of the copyrighted work, (3) the amount of the work used, and (4) the potential impact on the market. The Thompson Reuters Court found that factors two and three favored Ross because of the low degree of creativity involved in carving out headnotes from cases, as well as the fact that Ross did not output the headnotes themselves but rather judicial opinions. However, factor one favored Thomson Reuters because of the commercial nature of Ross’ product and the fact that it was not transformative. The Court noted that Ross’ product was not generative AI, suggesting that a generative AI product could be more transformative than the simpler lexical searching tool that Ross made. Finally, the fourth factor and “undoubtedly the single most important element of fair use” favored Thomson Reuters because of the potential impact on Thomson Reuters’ ability to sell its own data for use in training AI if Ross’ use was permissible. On balance, the Court flatly rejected Ross’ “fair use” defense as a matter of law. That question will not go to a jury.
AI developers will undoubtedly focus on the issue of transformative-use in generative AI fair-use battles to come, but the “commercial use” and “market impact” factors will continue to favor content owners over generative AI companies. We have already seen several massive licensing deals where companies like Reuters and Reddit are profiting from the sale of their own data. If courts continue to favor the “market impact” factor as we see in Thompson Reuters, then OpenAI, Suno, and the like will have an uphill battle to prove their “fair use” defense.
Current Status: We are still awaiting the “fair use” determination by the Third Circuit Court of Appeals, after the federal district court had certified Ross’ fair-use and copyrightability arguments for interlocutory appeal. On April 4th, the federal district court judge granted Ross Intelligence’ motion for interlocutory appeal off the Court’s summary judgment ruling against Ross’ “fair use” and copyrightability arguments. The Court stated that “Though I remain confident in my February 2025 summary judgment opinion, I recognize that there are substantial ground for difference of opinion on controlling legal issues in this case.” The two questions certified are “(1) whether the West headnotes and West Key Number System are original; and (2) whether Ross’s use of the headnotes was fair use.”
We’re not particularly surprised at this development. The country is watching this case rather closely because of its proximity to the generative AI training cases, and the hundreds of billions of dollars at stake there. Trying the case without considering the certified questions, and then having those issues reversed on appeal could waste everyone’s resources.
10. Reddit v. Anthropic
Background: Reddit, which has an ongoing generative AI licensing program, recently filed state court claims against Anthropic. Reddit filed its new state court action in California alleging breach of contract, unjust enrichment, trespass to chattels, tortious interference, and unfair competition. Reddit is an online forum and link-sharing site with millions of daily users and which recently held its initial public offering. Reddit offers materials posted by its users as training data available for licensing to companies like Anthropic, and its central complaint is that Anthropic has circumvented its licensing process in order to scrape training data without compensating Reddit, in violation of its User Agreement.
According to Reddit, although Anthropic has publicly stated that it does not scrape Reddit for training data, Reddit’s audit logs show that Anthropic has continued to deploy “automated bots to access Reddit content more than one hundred thousand times” in the months following these statements. Reddit alleges that this access outside its permitted licensing channels posses a risk to its users’ privacy as well as to the performance of the site itself, which must process these incoming automated requests in order to serve responses to them.
This case is distinct from other cases reported here because — unlike many other Plaintiffs — Reddit has an established channel through which Anthropic could pay for and benefit from Reddit’s data. Reddit’s position, therefore, is not one of an unwilling participant in the development process of AI, but rather that of a company which very much wishes to be a go-to source for training data and which is attempting to ensure that this benefit is only provided to paying partners in this enterprise. We will continue to report as this case develops.
Current Status: The parties fight over removal. This case has been removed to the Northern District of California after it was originally filed in California state court. Reddit was expected to file a motion to remand the case to state court on October 29th, which it did. Its motion argued that its claims involved non-copyright components which prevented pre-emption and that, even if the Court found some preemption, the Court should not exercise supplemental jurisdiction over the remaining causes of action. We expect the federal court may hold on to this one, but we will report back whenever we find out.
11. UMG Recordings v. Uncharted Labs (d/b/a Udio)
Background: This case was brought on June 24, 2024, in the Southern District of New York, by a group of major record companies against the company behind Udio, a generative AI service launched in April 2024 by a team of former researchers from Google Deepmind. Much like Suno (above), Udio allows users to create digital music files based on text prompts or audio files. And as with the complaint against Suno, Plaintiffs rely on tests comprising targeted prompts including the characteristics of popular sound recordings — such as the decade of release, the topic, genre, and descriptions of the artist. They allege that using these prompts caused Udio's product to generate music files that strongly resembled copyrighted recordings. The claims are for direct infringement and related causes of action. The judge assigned is Judge Alvin K. Hellerstein.
Current Status: No major substantive developments this past week. The docket in his case has seen very little development in the past months. However, the parties have agreed to an extension of time for document production, pushing the completion date out to October 10th.
12. UMG Recordings v. Suno
Background: The RIAA on behalf of the major record labels filed their lawsuit in the federal district Court in Massachusetts on June 24th, 2024, for mass copyright infringement and related claims based on alleged training on their copyrighted works. Suno is a generative AI service that allows users to create digital music files based on text prompts. This is the first case brought against an AI service related to sound recordings. In its answer on August 1st, 2024, Suno argued that its actions were protected by fair use. The judge assigned is Chief Judge F. Dennis Saylor, IV.
Current Status: No major substantive developments this past week. we discussed months ago, the Court adopted the parties’ joint stipulation and proposed order stipulating that digital copies of the works would suffice as deposit copies. Though the parties have continued discovery in the background, this has resulted in relatively few filings.
13. Sarah Andersen v. Stability AI
Background: Visual artists filed this putative class action on January 13th, 2023, alleging direct and induced copyright infringement, DMCA violations, false endorsement and trade dress claims based on the creation and functionality of Stability AI’s Stable Diffusion and DreamStudio, Midjourney Inc.’s generative AI tool, and DeviantArt’s DreamUp. On August 12th, 2024, the Court dismissed many of the claims in Plaintiffs’ first amended complaint, leaving the claims for direct copyright infringement, trademark, trade dress, and inducement. The assigned judge is Judge William H. Orrick.
Current Status: Dr. Zhao is still out. The Plaintiffs’ long battle to use Dr. Zhao as an expert may finally be over. The Court denied Plaintiffs’ motion to overturn the “very thorough” order by Magistrate Judge Cisneros denying Dr. Zhao permission to view confidential material as Plaintiffs’ expert. Check back next week to see where the parties take their dispute now that this issue has been decided with finality.
14. Dow Jones & Co, et al v. Perplexity AI
Background: On October 21st, 2024 The Wall Street Journal and The New York Post sued generative search company Perplexity AI in the U.S. District Court for the Southern District of New York for copyright infringement and other related claims. A new twist in this litigation is the focus on Retrieval Augmented Generation (“RAG”) AI. RAG GenAI not only uses an LLM trained on copyrighted material to respond to individual prompts, but also goes out to the web to update itself based on the relevant query. Perplexity even said the quiet part out loud, encouraging its users to “skip the links” to the actual sources of the copyrighted content. Based on Perplexity’s RAG model, the media Plaintiffs allege that Perplexity is infringing on their copyrights at the input and output stage, sometimes reproducing copyrighted content verbatim. Plaintiffs cited their parent company News Corp’s recent licensing agreement with OpenAI in explaining that GenAI technology can be developed by legitimate means.
Current Status: Going into deep freeze. It has been several months since Plaintiffs submitted their memorandum of law opposing Defendant’s motion to dismiss or transfer the case. We’re going to put this case on the back burner until there is some substantial movement on the docket.
15. Getty Images v. Midjourney and Stability AI
Background: Getty Images filed this lawsuit against image generator Stability AI on February 2nd, 2023, accusing the company of infringing more than 12 million photographs, their associated captions and metadata, in building and offering Stable Diffusion and DreamStudio. Getty’s claims are similar to those in The New York Times v. Microsoft & OpenAI case above, but here they are in the context of visual images instead of written articles - i.e., unlicensed scraping by their AI with an intent to compete directly with, and profit from, Getty Images (i.e., market substitution). This case also includes trademark infringement allegations arising from the accused technology’s ability to replicate Getty Images’ watermarks in the AI outputs. Getty filed its Second Amended Complaint on July 8th, 2024, and the parties are currently engaged in jurisdictional discovery related to Defendants’ motion to transfer the case to the Northern District of California. The judge assigned is Judge Jennifer L. Hall.
Current Status: Still no update for Getty. With no notable updates for Getty in over a third of a year, this case on the back-burner. As a final update on where we last left off: Getty had submitted a letter to the Court on November 25th, 2024 explaining its frustration with Stability AI’s refusal to participate in discovery or participate in a Rule 26(f) conference. In August 2024, Stability AI had argued that they were under no obligation to commence fact discovery until the Court issued its ruling on jurisdiction. Getty had requested that the Court order Stability to stop delaying and proceed with the case, but after several months with no response from the Court, it appears unclear when things will begin moving forward again.