Seattle Times and Newsday Sue OpenAI and Microsoft in Escalating Copyright Battle Over AI Training

Reviewed byNidhi Govil

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The Seattle Times and Newsday filed a copyright lawsuit against OpenAI and Microsoft, alleging unauthorized use of journalism to train AI models. The case joins nearly 400 news outlets in legal action against the tech giants, with court filings revealing sharp divisions over fair use and the future of the journalism industry.

Seattle Times and Newsday Join Growing Legal Battle Against AI Giants

The Seattle Times and Newsday have filed a copyright lawsuit against OpenAI and Microsoft, marking another significant escalation in the ongoing legal dispute over AI training practices

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. The two news organizations sue AI companies for allegedly using their journalism without permission to train AI models like ChatGPT and Copilot. Filed on Friday, the lawsuit describes generative AI as "a snake eating its own tail" that could "destroy the very organizations" producing the content it consumes

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. This legal action against OpenAI adds to nearly 400 local newspapers that recently sued the two companies, claiming chatbots reduce traffic to their sites and cost them valuable subscription revenue

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Source: GeekWire

Source: GeekWire

Copyright Infringement Claims Target Core Business Models

The copyright lawsuit alleges that OpenAI and Microsoft were "methodically scraping" news articles in ways that bypass paywalls, fundamentally harming business models for news organizations

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. The Seattle Times and Newsday claim these practices give users AI-generated alternatives to news articles, reducing digital advertising revenue and website traffic

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. The lawsuit further alleges that AI models create hallucinations attributing false information to the outlets and remove copyright management information from articles

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. As part of their legal action, the publishers seek destruction of any copies of their works the companies hold, along with training data and AI models incorporating them

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Source: MediaNama

Source: MediaNama

Microsoft Funding Creates Uncomfortable Irony in Legal Battle

The Seattle Times lawsuit carries particular significance because OpenAI and Microsoft have previously funded some of the organization's journalism projects and fellowships

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. A Microsoft spokesperson told GeekWire the company is "surprised by the lawsuit" but remains "always happy to sit down and explore solutions to this type of dispute"

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. This creates an uncomfortable dynamic where a company that has supported journalism now faces accusations of undermining the journalism industry through its use of copyrighted material to train AI models.

Fair Use Defense Sets Stage for Landmark Legal Test

OpenAI, Microsoft, The New York Times, and a group of prominent authors laid out sharply differing views on AI training under copyright law in court filings submitted to U.S. District Judge Sidney Stein in Manhattan

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. Both sides requested rulings on the companies' "fair use" defense, which will likely determine the outcome

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. The New York Times, whose lawsuit was first filed in 2023, accuses OpenAI and Microsoft of using millions of newspaper articles without permission to train ChatGPT

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. Authors including John Grisham, Jonathan Franzen, and George R.R. Martin separately sued the companies the same year for using their books to train AI models

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Diverging Judicial Opinions Create Legal Uncertainty

The pending cases will likely turn on whether AI systems make fair use of copyrighted material by creating transformative use of content

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. Two judges who considered the issue issued diverging rulings last year. U.S. District Judge William Alsup in San Francisco called Anthropic's use of books for AI training "quintessentially transformative"

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. Judge Vince Chhabria, also in San Francisco, ruled for Meta two days later, calling its use of copyrighted books transformative but warning that AI training would not be fair use "in many circumstances" and raising concerns that generative AI could "flood the market" with content competing with human creators

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Tech Companies Defend Transformative Nature of AI Training

Citing Alsup's ruling, OpenAI told the Manhattan court that using copyrighted material for AI training is "among the most transformative many of us will see in our lifetimes" and claimed its technology has not harmed writers

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. "The purpose of OpenAI's pretraining process was to derive broad, unprotectable statistical patterns related to language that can be used to create new text, not reproduce protected expression," OpenAI stated in its brief

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. Microsoft argued that existing copyright law "does not permit rights holders to block transformative technologies" like Copilot

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. The company further stated that "neither LLM training nor the use of LLMs in products substitutes for copyrighted books"

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Source: Engadget

Source: Engadget

News Organizations Argue AI Threatens Creative Incentives

The Times claimed in court filings that its articles were not transformed by the tech companies and not subject to fair use protections under copyright law

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. "The future not just of journalism but of responsible A.I., too, depends on preserving incentives for humans to produce the creative works on which a healthy society depends," The Times wrote

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. Authors echoed concerns that AI is "diluting the market for books across the board," arguing that fair use "does not countenance such catastrophic threats to the incentive to create"

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. News outlets said ChatGPT diverts users from their websites and displaces the market for their work, with The Times arguing its business was harmed through substantially lower click-through rates when traditional search links were replaced with AI-generated summaries

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Industry Split Emerges as Some Publishers Partner with AI Companies

While news organizations sue OpenAI and Microsoft in growing numbers, other outlets have taken a different approach. AP and Vox Media have partnered with OpenAI, allowing the AI giant to train models on their material

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. This split strategy reveals deep divisions within the journalism industry about how to respond to AI's disruption. Judge Stein is expected to rule on summary judgment motions in the coming weeks, with the decision likely to have far-reaching implications for how copyright law applies to AI training practices

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. The outcome will shape whether AI companies must negotiate licenses for training data or can continue current practices under fair use protections, fundamentally affecting both the economics of journalism and the development trajectory of AI systems.

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