IP Law Daily, COPYRIGHT NEWS: Britannica and Merriam-Webster sue Perplexity AI for infringing copyrighted works and trademarks, (Sep 12, 2025)

By Carolin Dennis, B.Sc., LL.B., LL.M.

The complaint alleges copyright violations at the “input” and “output” stages, as Perplexity copies and paraphrases the publication companies’ copyrighted works from their websites by crawling and falsely attributes them to the publication companies’.

Encyclopaedia Britannica, Inc. (Britannica) and Merriam-Webster, Inc. (Merriam-Webster) (collectively, publication companies) filed a complaint against Perplexity AI, Inc. (Perplexity), in the U.S. District Court for Southern District of New York, alleging copyright infringement in violation of the Copyright Act and false designation of origin/trademark dilution in violation of the Lanham Act. The publication companies seek to hold Perplexity responsible for the substantial harm it is causing and illicit profits it is reaping by infringing on their copyrights and trademarks and to protect the public’s continued access to high-quality and trustworthy online information (Encyclopaedia Britannica, Inc. v. Perplexity AI, Inc., No. 1:25-cv-07546 (S.D.N.Y. filed Sept. 10, 2025)).

Perplexity is a generative artificial intelligence company that purports to revolutionize Internet search by providing its users with a so-called “answer engine.” According to Perplexity, when you ask Perplexity a question, it uses advanced AI to search the internet in real-time, gathering insights from top-tier sources. It then distills this information into a clear, concise summary, delivering exactly what you need in an easy-to-understand, conversational tone.

The publication companies contend that Perplexity engages in massive copying of the publication companies and other web publishers’ protected content without authorization or remuneration. The publication companies allege that Perplexity accesses as much content as it can from them and other original sources of trusted, reliable information and then makes copies of that content, feeds the content to its retrieval-augmented generation or “RAG” model, and repackages the original content in written responses to users. The publication companies also allege that Perplexity’s responses or outputs often are verbatim or near-verbatim reproductions, summaries, or abridgements of the original content, including the publication companies’ copyrighted works.

According to the complaint, Perplexity’s conduct violates the publication companies’ exclusive rights under the Copyright Act in three ways: (1) at the curation stage when it uses a software program called “PerplexityBot” to crawl and scrape the publication companies’ websites for Perplexity’s answer engine; (2) at the input stage when it copies the publication companies’ copyrighted articles that are responsive to user searches to prompt responses from its RAG model; and (3) at the output stage when its RAG model generates outputs that are substantially similar to those inputs.

In addition, Perplexity also violates the publication companies’ trademarks under the Lanham Act when its AI products generate made-up content or hallucinations; or misleadingly omit portions of the publication companies’ content without disclosing those omissions and display the incomplete and inaccurate reproductions and falsely attribute them to the publication companies’ by displaying them alongside the publication companies’ famous trademarks. Further, Perplexity’s use of the publication companies’ trademarks constitutes false designations of origin, and confuses and deceives Perplexity users into believing that the hallucinations and/or undisclosed omissions are associated with, sponsored by, or approved by the publication companies.

The publication companies contend that they are directly injured by Perplexity’s misuse of their copyrighted works because it deprives them of immediate and potential advertising and subscription revenues. In addition, to the massive misappropriation of revenue, when outputs from Perplexity’s machine contain hallucinations attributed to the publication companies via their trademarks or undisclosed omissions in reproductions of the publication companies content, they are further harmed by false attributions and dilution.

The publication companies argued that Perplexity’s conduct also harms the public by eroding the economic incentives necessary for the creation and publication of trustworthy, informative content. In the long term, the publication companies and other publishers will not be able to generate high-quality content because they will not receive a sufficient return on investment via advertising and subscription revenues. The publication companies contended that less content of poorer quality will further result in reduced revenue, and thus less spending on content creation, spawning even less content of even poorer quality and even less revenue, and so on in a downward spiral for content creators.

Claims, remedies sought. The publication companies are seeking a jury trial and assert three causes of action: (1) copyright infringement for Perplexity’s copying of their copyrighted works to create “inputs” for its RAG content, (2) copyright infringement for Perplexity’s copying of their copyrighted works to create “outputs” to user queries, and (3) false designation of origin and dilution of their trademarks. The publication companies ask the Court to permanently enjoin Perplexity from engaging in the unlawful conduct alleged in the complaint. They also seek statutory damages, actual damages, restitution of profits, costs, expenses, and attorneys’ fees as permitted by law, and such other or further relief as the Court may deem just.

The Case is No. 1:25-cv-07546.

Attorneys: Gloria Park, Ian Crosby, and Davida Brook (Susman Godfrey L.L.P.) for Encyclopaedia Britannica, Inc. and Merriam-Webster, Inc.

Companies: Encyclopaedia Britannica, Inc.; Merriam-Webster, Inc.; Perplexity AI, Inc.

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