Legal Implications Of New York Times vs. OpenAI – Copyright

The New York Times recently filed a landmark lawsuit against
OpenAI and Microsoft, accusing them of copyright infringement in
the training of the chatbot ChatGPT which launched just over a year
ago.

The case promises to create debate on par with Section 230 of
the Communications Decency Act (CDA), internet legislation from the
1996 Telecommunications Act allowing website platforms to exist
without being held liable for user content. While Section 230 has
helped foster free expression and innovation on the internet, it
has faced criticism for allowing platforms to avoid responsibility
for harmful content.

Similarly, this complex case will have far-reaching
implications, most notably the potential to rewrite the rules of
intellectual property in the age of artificial intelligence.
Businesses are wise to take note.

The Claim

The Times claims that millions of their online articles were
crawled to train ChatGPT, a generative language model capable of
crafting human-like text. They’ve documented examples of
alleged plagiarism where ChatGPT returns factual content and
phrasing directly from New York Times articles. They also state
that ChatGPT is diverting traffic, depriving them of advertising,
licensing, and subscription revenue. The Times argues that this
goes beyond fair use and undermines their investment in original
journalism.

OpenAI, the not-for-profit research company behind ChatGPT,
counters that training on publicly available information such as
news articles falls under fair use.

What’s At Stake

A victory for The Times could establish a precedent requiring
compensation for journalists and writers for copyrighted content
used in AI training, impacting development of other large language
models (LLMs) such as Google’s Gemini and Meta’s LLaMA.
Conversely, a win for OpenAI could reinforce the current practice
of using massive datasets without explicit permission from
publishers, further muddying intellectual property rights in these
digital times.

Why it Matters for Businesses

The New York Times vs. OpenAI lawsuit, while focused on
journalism and AI, holds significance for companies across many
sectors that are utilizing AI in conducting business and developing
products. Here are key themes businesses should be aware of:

• Copyright Landscape: A victory for The Times could set a
  precedent for financial compensation for any copyrighted content
  used in AI training, including marketing materials, internal
  documents, and product manuals. This could significantly impact
  companies relying on AI for content creation and analysis.




• Data Privacy: The case raises questions about data ownership
  and control. Businesses heavily invested in collecting and using
  data might face stricter regulations or limitations on how it can
  be used for AI development.




• Fair Use vs. Commercial Value: Companies using AI for
  monetization purposes may need to re-evaluate their data sourcing
  practices and ensure proper licensing or compensation for any
  copyrighted material used in training.




• AI Development Costs: If compensation becomes the norm, the
  cost of developing and deploying AI solutions could rise
  significantly. Businesses might need to factor in new budgeting
  lines or adjust their reliance on AI-powered tools.




• Financial Risks: Depending on the outcome, businesses adopting
  AI could face lawsuits claiming copyright infringement or demands
  for licensing fees.




• Technology Advancements: The future of AI development hinges on
  this case. A restrictive ruling could dampen innovation and limit
  the capabilities of AI tools available to businesses. Yet a clear
  fair use framework could boost responsible AI development.

New York Times vs. OpenAI is a watershed moment for
intellectual property law and artificial intelligence. Savvy
business leaders should monitor the case to assess potential risks
and compliance needs. The outcome could be years away, but the
ramifications are broad and deserve proactive attention from
businesses of all sizes.

Originally published February 1, 2024

The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.

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