1. Disney et al. v. MiniMax & Hailuo AI
Current Status: Defendants file their motions to dismiss. This week, Defendants filed two motions to dismiss Disney’s claims. The first motion concerns MiniMax and Shanghai Xiyu Jizhi Technology (“SXJT”). According to the motion, MiniMax is not a legal entity at all (it is, apparently, a brand name) and thus a Court cannot exercise jurisdiction over it. With respect to SXJT, the motion argues that the Court does not have personal jurisdiction because SXJT is a Chinese company and has not directed any of its activities to the United States. Instead, according to the motion, any US contacts stem from Nanonoble.
The second motion concerns Nanonoble and argues failure to state a claim. Its first major argument is that Disney has not demonstrated that it has registered copyrights on its characters (as opposed to the works in which those characters appear) and, further, that Disney has failed to demonstrate that it even could copyright those characters under Ninth Circuit law. Second, the motion argues that any copying related to Disney’s direct infringement claim did not occur in the United States because the associated models are trained in China. Third, the motion argues that Disney’s secondary infringement claims should be dismissed because (among other reasons) their contributory infringement claims fail the Cox Communications, Inc. requirement that a service be tailored to infringement or that a Defendant affirmatively induced infringement. With respect to induced infringement, Nanonoble argues that Disney failed to plausibly allege that they actively encouraged any users to infringe Disney’s works.
We’ll see how the court reacts to these claims. We think it’ll be difficult to convince the court that Disney doesn’t have a copyright interest in Darth Vader. Stay tuned for Disney’s response brief.
2. UMG Recordings v. Suno
Current Status: No “Copyright Abuse” defense for Suno—at least not yet. After several uneventful weeks, this week saw a lengthy order ruling on various ongoing discovery disputes between UMG Recordings and Suno. Suno had argued that documents related to Plaintiffs’ ongoing business relationships would go to Suno’s developing theory of “copyright abuse.” “Copyright abuse” is an equitable defense to copyright infringement that accuses the copyright holder of using its copyright in a manner that violates public policy, or anticompetitively extending the copyright beyond the scope of copyright law. In the seminal case Lasercomb America, Inc. v. Reynolds, the copyright holder had used a license agreement to try to impose a ninety-nine-year non-competition agreement, which the 4th Circuit rejected as beyond the scope and purpose of the Copyright Act.
Here, Suno argued that UMG is trying to destroy or stifle AI-based innovations in the music industry by refusing to negotiate with AI companies over training data. The Order noted two problems with this theory. First, “copyright abuse” has not been adopted in the First Circuit. Second, the Magistrate Judge pointed out that Plaintiffs have demonstrated that they have executed license agreements with other AI companies, thus calling into question the foundation of the theory. Nonetheless, this is an interesting new theory to see an AI company deploy—one that may either continue to develop in this case or arise in other cases governed by different Circuit precedent.
Plaintiffs did not come out much better than Defendants. Their request for Suno’s settlement agreement with Warner Music Group was denied because disclosing the agreement would tend to chill settlement while providing little probative value. Plaintiffs’ request for additional custodians from Suno was also denied.
Suno has not given up on establishing that UMG is engaged in a campaign to stifle the development and adoption of generative AI outputs. Following this Order, the parties submitted joint letter briefs including Suno’s requests for Plaintiffs’ licensing practices. Suno focused on UMG’s recent removal of its catalogue from TikTok unless TikTok abandons its current plan to allow AI content to be “paid on the same basis as artists’ [music].”
Suno’s argument is both novel and interesting. On the one hand, the Copyright Act protects specific works, and one could argue that the overriding purpose of GAI is not to replicate or replace a specific work, but to replace the worker. On the other hand, it’s hard to see how it would be “abusive” to deny a license to a competitor who wants to use your work to replace your entire catalog. We’ll see how Suno’s novel argument develops.
3. Sarah Andersen et al. v. Stability AI, et al.
Current Status: Many discovery issues loom large with the close of discovery approaching. With fact discovery still ongoing, this week saw several different discovery disputes raised by various parties, starting with a joint status report reflecting many issues which the parties are still working to resolve. The parties also submitted joint letter briefs regarding Midjourney’s request for additional deposition time with plaintiffs Sarah Andersen, Karla Ortiz, Gerald Brom, and Julia Kaye, citing case complexity as justifying the extra time. Plaintiffs have opposed the request, claiming that it is belated and burdensome. Plaintiffs also appear to be having difficulties scheduling depositions with two DeviantArt witnesses who are in Canada and filed a motion requesting the issuance of Letters Rogatory to secure their appearance.
Finally, Plaintiffs filed a motion requesting the extension of the upcoming June 1st fact discovery cut-off date to ensure that time is available to complete depositions and allow Plaintiffs’ recently-retained technical expert to examine relevant evidence.
4. Disney, Universal, and Warner Bros. v. Midjourney
Current Status: Disney opposes Midjourney’s request for in-house AI materials. AS discussed recently, Midjourney filed a motion seeking documents related to the development of Disney’s own Generative AI development and its in-house use of such technologies. This week, Disney filed an opposition brief in which it argued that in-house development and use of AI tools was irrelevant to any claim or defense in the case, accusing Midjourney of attempting to distract from its own unlawful behavior.
We tend to agree with Disney on this one. What Disney does in-house with its own intellectual property seems to have nothing to do with whether Midjourney’s use of Disney’s copyrighted materials is fair use.
5. SDNY Multi-District Litigation
Current Status: In-person status conference scheduled. With the close of fact discovery, the docket in the multi-district litigation has slowed considerably, though a small number of discovery issues still remain unresolved. This week, Magistrate Judge Wang ordered that an in-person Status Conference would be held on May 12, presumably to resolve these remaining issues. The Order also set a briefing schedule ahead of the conference, with opening briefs due April 29, opposition briefs due May 4, and a joint dispute chart from the parties due on May 5.
6. Richard Kadrey, et al. v. Meta
Current Status: No major substantive developments this past week. Last week, Plaintiffs filed their Fourth Amended Complaint, which added contributory infringement claims based on Meta’s seeding of torrented books. That amendment was only “reluctantly” permitted to avoid absent class members being precluded from bringing such a claim in the event that the Kadrey plaintiffs fail to prove their case at trial. This week, however, was largely uneventful—the only notable new filing was an order by Magistrate Judge Hixson which sustained Meta’s claims of attorney-client privilege with respect to documents for which in camera review was ordered some weeks ago.
7. Sony v. Uncharted Labs (d/b/a Udio)
Current Status: No major substantive developments this past week. Following a number of settlements, recent weeks have seen few new filings. Late last year, Plaintiffs UMG Recordings, Capitol Records, Atlantic Recording Corp., Rhino Entertainment Co., and Warner Music all filed stipulations of dismissal, leaving Sony Music Entertainment as the lone plaintiff in the case.
In the past few weeks, Sony submitted a supplemental filing in connection with Udio's pending motion to dismiss, citing a recent California decision (Cordova v. Huneault) where a court allowed a similar DMCA claim to proceed. Sony argues this case supports its claim that Udio illegally bypassed YouTube's security measures to download copyrighted music for AI training.
In response, Udio filed a letter in further support of its motion to dismiss, arguing the Cordova decision is not persuasive. Udio’s key argument is that Cordova is not applicable because it failed to address a critical distinction in the law—the difference between “access controls” (which cannot be bypassed) and “copy controls” (which can be freely circumvented). Udio contends that YouTube's “rolling cipher” technology is a copy-prevention measure, not an access-control measure, and therefore bypassing it is not illegal under the DMCA. Udio maintains that Sony’s DMCA claim should be dismissed with prejudice.
8. Concord Music Group, et al. v. Anthropic
Current Status: No major substantive developments this past week. Over the past few weeks, we have discussed Plaintiffs’ motion for partial summary judgment, which arguments related to copyright infringement and fair use (including a market dilution argument). Additionally, two amicus briefs have been filed so far, both supporting Plaintiffs’ fair use arguments. This week, however, the docket included no notable new filings. The next major milestone is likely to be Anthropic’s summary judgment briefing, which will be due soon.
9. Hendrix v. Apple
Current Status: No major substantive developments this past week. Early in February, the parties filed an amended consolidated complaint which included additional factual allegations regarding the ways in which Apple integrates its models into its products and the manner in which these models have impaired the market for Plaintiffs’ works. Last week, Apple filed an answer in which it admitted that its models were trained on copyrighted works but which largely disclaimed Plaintiffs’ allegations as conclusory or simply reciting text from sources which speak for themselves. This week, however, saw no new filings on the docket.
10. Reddit v. Anthropic
Current Status: No major substantive developments this past week. This case remains dormant while it works through the remand to state court ordered last week.