Corporate Counsel Daily, New York Times sues Microsoft, OpenAI for alleged copyright infringement, (Jan 3, 2024)

By Jonathan Anderson

The lawsuit alleges that ChatGPT and other AI-powered tools use the newspaper’s articles without authorization and reproduce the material verbatim.

On December 27, 2023, The New York Times Company sued Microsoft Corporation and entities affiliated with the artificial intelligence (AI) tool ChatGPT alleging copyright infringement. The complaint accuses defendants of training ChatGPT and other large-language models (LLMs) like Bing Chat by using Times content without authorization and reproducing that content verbatim. The complaint advances seven counts against defendants: copyright infringement, vicarious copyright infringement, contributory copyright infringement, violations of the Digital Millennium Copyright Act, common law unfair competition by misappropriation, and trademark dilution. The complaint seeks unspecified statutory damages, compensatory damages, restitution, disgorgement, and an injunction from further infringement (New York Times Co. v. Microsoft Corp., filed December 27, 2023).

Background. Co-defendant, OpenAI Inc., indirectly owns and controls ChatGPT. Microsoft has invested at least $13 billion in OpenAI and owns a stake in the company. Microsoft also operates AI-powered tools like the Bing search engine and Bing Chat, recently rebranded as “Copilot.”

The complaint alleges that defendants built popular AI tools by copying and using millions of the newspaper’s articles without authorization, that the tools reproduce Times content verbatim, and attribute inaccurate information to the Times. “Defendants seek to free-ride on The Times’s massive investment in its journalism by using it to build substitutive products without permission or payment,” the complaint states.

Copyright infringement. The first count in the complaint alleges copyright infringement under 17 U.S.C. § 501 against all defendants. The complaint alleges that defendants infringed on the Times’ rights by building training datasets with millions of copyrighted works scraped from the Times’ websites and reproducing those works in datasets. The complaint further alleges that defendants infringed on the Times’ rights by storing, processing, and reproducing the training datasets to train GPT models; storing processing, and reproducing the GPT models, which have allegedly memorized the Times works; and disseminating generative output containing copies and derivatives of Times works.

Vicarious copyright infringement. The second count alleges vicarious copyright infringement against Microsoft and certain OpenAI defendants. The complaint asserts that “Microsoft controlled, directed, and profited from the infringement perpetrated by the OpenAI Defendants.” This is because Microsoft allegedly controls and directs the supercomputing platform used to store, process, and reproduce the training datasets at issue.

Contributory copyright infringement against Microsoft. The third count, contributory copyright infringement, alleges that “Microsoft materially contributed to and directly assisted in the direct infringement attributable to the OpenAI Defendants.” The complaint alleges that Microsoft provided computing infrastructure and assisted the other defendants in building training datasets; storing, processing, and reproducing the training datasets; providing computing resources to host, operate, and commercialize GPT models and AI products; and provided a plug-in to facilitate infringement and generate infringing output.

Contributory copyright infringement against all defendants. Count four alleges contributory copyright infringement against all defendants. The complaint states that “to the extent an end-user may be liable as a direct infringer based on output of the GPT-based products, Defendants materially contributed to and directly assisted with the direct infringement perpetrated by end-users of the GPT-based products by way of: (i) jointly-developing LLM models capable of distributing unlicensed copies of Times Works to end- users; (ii) building and training the GPT LLMs using Times Works; and (iii) deciding what content is actually outputted by the GenAI products, such as grounding output in Times Works through retrieval augmented generation, fine-tuning the models for desired outcomes, and/or selecting and weighting the parameters of the GPT LLMs.”

Digital Millennium Copyright Act. The fifth count alleges violation of the Digital Millennium Copyright Act, 17 U.S.C. § 1202. The complaint alleges that defendants removed the Times’ copyright-management information from the scraped content in violation of 17 U.S.C. § 1202(b)(1) and distributed the content without the copyright-management information in violation of 17 U.S.C. § 1202(b)(3).

Common law unfair competition by misappropriation. Sixth, the complaint alleges that defendants’ conduct constitutes unfair competition because taking the Times’ content and republishing it competes directly with the Times for web traffic, resulting in loss of advertising revenue. Further, the complaint alleges that defendants have deprived the Times of the opportunity to receive referral revenue for links in product reviews.

Trademark dilution. Count seven alleges trademark dilution against all defendants under 15 U.S.C. § 1125(c) by using the Times’ trademarks in outputs without authorization, including on lower-quality and inaccurate material.

Relief requested. The complaint seeks unspecified statutory damages, compensatory damages, restitution, disgorgement, and any other permitted relief; a permanent injunction from the alleged unlawful and infringing conduct; an order for destruction under 17 U.S.C. § 503(b) of all GPT or other LLM models and training sets that incorporate the Times works; as award of costs, expenses, and attorney fees permitted by law; and any other relief the court deems appropriate.

The Case is No. 1:23-cv-11195.

Attorneys: Jennifer Maisel (Rothwell Figg Ernst & Manbeck, PC) for New York Times Co.

Companies: New York Times Co.; Microsoft Corp.; OpenAI, Inc.; OpenAI LP; OpenAI GP, LLC

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