U.S. ruling a step forward in litigating AI copyright disputes

By Tony Poland, LegalMatters Staff • A ruling in a U.S. class action lawsuit has created a “roadmap” that may guide artificial intelligence (AI) copyright infringement cases going forward, says Toronto intellectual property lawyer John Simpson.

Earlier this month a Northern District of California judge ruled that a groundbreaking copyright infringement lawsuit filed by visual artists against Stability AI, Midjourney and other AI-related companies can move forward to the discovery phase on a number of contentious issues.

The artists allege generative artificial intelligence services violate copyright laws. They are seeking damages over uncompensated and unauthorized use of billions of images downloaded from the internet to train AI systems.

“This is a decision that should capture the attention of the various stakeholders in the AI industry, both developers and users of it,” says Simpson, principal of IP boutique Shift Law Professional Corporation. “This is an area that copyright lawyers around the world are extremely interested in. Up to this point, much of what has been talked about and written about has been hypothetical and theoretical.

‘This is where the rubber hits the road’

“This is where the rubber hits the road on many of these issues,” he tells LegalMattersCanada.ca. “Now we can see how the issues surrounding AI can be worked out. This is just one judge in one court, but it does create a roadmap that will likely be relied on in future decisions.”

Simpson, who was not involved in the case but comments generally, cautions that the ultimate issues of liability are still to be decided.

“This was a motion by the defendants to strike allegations arguing there is no cause of action here,” he says. “This is all about what aspects of this case are allowed to proceed. It is not as if these plaintiffs have successfully sued Stability AI and the artificial intelligence industry will now crumble. We are quite a way off from anything like that.”

“What it means is that at least this court is allowing these important allegations to proceed and there is going to be discovery on the issues.”

Discovery is where “we get to open the box and see what’s going on with these AI data sets and with this technology,” Simpson says.

Will get to see how the technology works

“The lawyers will get the opportunity to explore how the material in question is being used,” he explains. “Many of the allegations regarding how this technology actually works have been unproven to this point. But now, through discovery, the plaintiffs will get to see what is happening to the works at issue. How is this technology using them? Is it actually making copies of works?”

“This ruling is almost entirely a very positive development for creators of original works,” Simpson adds. “It creates a structure around how these cases can be pleaded and advanced.”

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There are a number of legal and factual issues to be explored, Simpson says. For instance, is the data set itself an infringing work?

“Are AI companies infringing on protected works with their technology or are they just inducing consumers of the technology to infringe?” he asks. “And obviously, the major issue is does the creation of the data set involve copying of protected works?” 

Simpson says he will be watching to see how intellectual property law will be applied in the case and others like it.

‘Yet another frontier of technology’

“It is interesting from a copyright lawyer’s perspective,” he says. “It is yet another frontier of technology where old legal concepts will need to be moulded into tools that can be applied to modern disputes.”

Copyright law was developed “many years before any of this technology was even contemplated,” Simpson says.

“Our thinking about these things has been largely set in stone,” he says. “Copyright law, to a great extent, was written by people who were thinking about newspapers and books.

“Now we are having to deal with that bedrock of law and apply it to very new situations,” Simpson says.

He says he expects the recent court decision will “catch the attention of all of the various stakeholders in the AI industry.”

“This is not a promising decision for everyone. I am sure that developers of AI and many users would have preferred to see the case tossed in its entirety,” says Simpson. “But for creators of original works, it is unquestionably a positive development.”