Court Advances The New York Times Lawsuit Against OpenAI

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A federal judge has denied OpenAI’s attempt to throw out a copyright case filed by The New York Times, which alleges that the technology firm illegally utilized their content to educate its AI system, without seeking permission or providing payment.

On Wednesday, U.S. District Judge Sidney Stein moved forward with the main arguments by The New York Times regarding copyright violation and limited the focus of the lawsuit. She stated that her decision would be made promptly.

On Wednesday, Judge Sidney Stein supported the key points brought up by The New York Times about copyright infringement and reduced the issues in the court case. She said she will make a quick decision.

By making this determination, the publication surmounts a significant obstacle in the legal proceedings, as it aims to find resolution regarding ‘fair use’ – a crucial aspect in AI disputes which queries if utilizing copyrighted content for training AI systems without prior permission can be justified.

2023 saw the lawsuit being initiated by the publication, following a standstill in negotiations with OpenAI and Microsoft regarding an agreement aimed at addressing issues surrounding their use of the publication’s articles to educate automated chatbot systems. After the widespread launches of ChatGPT and BingChat, The Times brought attention to the companies about potential infringements on its content. The proposed settlement included a licensing contract and the establishment of boundaries for generative AI technologies, but the discussions failed to reach an amicable resolution.

The ongoing lawsuit against OpenAI, also reported by various other news outlets, may significantly impact the future of the news industry. At risk is the economic sustainability of media, especially when readers increasingly opt for AI-generated search results instead of accessing information directly from sources. If courts rule in favor of publications, OpenAI might be compelled to negotiate expensive licensing agreements.

In the lawsuit, The Times demonstrated a vast amount of proof showing that products from OpenAI and Microsoft replicate entire passages from articles when prompted, enabling users to bypass paywalls. According to The Times, these responses surpass the brief text previews usually seen with standard search results. For instance, Bing Chat repeated almost all (save for two) of the initial 396 words from its 2023 article titled “The Secrets Hamas knew about Israel’s Military.” An exhibit displayed around a hundred instances where OpenAI’s GPT was trained on and memorized articles from The Times, with the identical passages highlighted in red and any discrepancies shown in black.

After the legal action, OpenAI adjusted their chatbot’s responses to avoid directly repeating text from articles.

Instead of suing tech companies, The Times has chosen a different path by opting to engage in licensing deals, unlike other publications such as News Corp (owner of The Wall Street Journal and New York Post), Condé Nast (The New Yorker’s owner), and Dotdash Meredith. Last year, Dotdash Meredith revealed that their annual earnings from the OpenAI licensing deal were approximately $16 million. News Corp has positioned its deal with Sam Altman-led firm as a means to further its media interests.

In the midst of a legal dispute, The Times revealed back in early 2024 that they had invested approximately $10.8 million in expenses related to generative AI litigation, as per their quarterly financial report.

If a violation is found to have occurred, it could lead to substantial penalties as each willful infringement has a potential fine of up to $150,000. This lawsuit alleges copyright infringement, contributory copyright infringement, and trademark dilution. In Tuesday’s decision, the court discarded the claims of unfair competition and violation of the Digital Millennium Copyright Act permanently, meaning these specific accusations cannot be brought up again in future proceedings.

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2025-03-27 00:54