Last week's landmark lawsuit by the New York Times against OpenAI and Microsoft's alleged copyright infringement in its LLM training, may prove to be the most serious threat the tech companies have faced to their AI business models and could reshape the industry. Cecilia Ziniti, former Amazon in-house counsel, and founder of General Counsel AI, has broken down the lawsuit in a recent X thread.

As Ziniti says, not only does the New York Times clearly lay out that it "is the single biggest proprietary data set in Common Crawl used to train GPT," but visual evidence is quite striking and will no doubt sway the jury. "My take? OpenAI can't really defend this practice without some heavy changes to the instructions and a whole lot of litigating about how the tech works. It will be smarter to settle than fight."

Beyond accusations of stolen labor, Ziniti says that the Times added a "clever twist" to their lawsuit: "Misinformation allegations add a clever twist. The complaint pulls in something people are scared of - hallucinations - and makes a case out of it, citing examples where elements of NYT articles were made up."

She continues that "the Times "got really good lawyers. Susman Godfrey has a great reputation and track record taking on tech. This isn't a quick cash grab like the lawsuits filed a week after ChatGPT; it's a strategic legal challenge." As Ziniti reiterates, this case could fundamentally change how AI and copyright work. "What's at stake?," she concludes. "The future of AI innovation and the protection of creative content. Stay tuned."

Of course, Ziniti is one of many IP and AI lawyers to weigh in on this case. Venture Beat spoke with Bradford Newman, a partner at the Palo Alto office of Baker McKenzie back in August 2022 (before ChatGPT was released). At the time, he noted that "there are the inevitable class actions, but the net net of it all is when you’re using the massive data sets that these AI applications are and you sprinkle on top of that open source licenses…the arguments are going to be fair use versus infringement.” Newman predicted that these cases would ultimately end up at the Supreme Court, and it may be that the New York Times's case makes its way up.

Marc Rotenberg, founder and President of the Center for AI and Digital Policy and an adjunct at Georgetown Law, sees the case a bit different. He begins by citing the 2015 Google Books case, which Google one on "fair use" grounds, but which is "the reason that the New York Times, which survived the first battle, even as many regional and local news organizations collapsed, is suddenly aware that they may be in trouble too.” He explained that "every 20 years or so, there’s a new, really significant question that comes along and forms how the commercial world works,” and the Times's lawsuit against OpenAI and Microsoft is part of "the next big wave of litigation over these tools that are going to, if you ask me, have a profound effect on society.”

Daniel Gervais, co-director of Vanderbilt University's IP program agrees. As he told NPR, "Copyright law is a sword that's going to hang over the heads of AI companies for several years unless they figure out how to negotiate a solution."

THE VERDICT:

The old Silicon Valley adage of “move fast and break things” still seems to be alive and well. The only difference today is the sheer amount of money and visibility these firms now have. If OpenAI wanted to ask for forgiveness rather than permission to “train” its hugely valuable systems on the New York Times’s data, it may end up costing the start-up more than it bargained for.