A U.S. district court is scheduled to consider whether to approve the settlement next week, in a case that marked the first substantive decision on how fair use applies to generative AI systems.
In one of the largest copyright settlements involving generative artificial intelligence, Anthropic AI, a leading company in the generative AI space, has agreed to pay $1.5 billion to settle a copyright infringement lawsuit brought by a group of authors.
If the court approves the settlement, Anthropic will compensate authors around $3,000 for each of the estimated 500,000 books covered by the settlement.
The settlement, which U.S. Senior District Judge William Alsup in San Francisco will consider approving next week, is in a case that involved the first substantive decision on how fair use applies to generative AI systems. It also suggests an inflection point in the ongoing legal fights between the creative industries and the AI companies accused of illegally using artistic works to train the large language models that underpin their widely-used AI systems.
The fair use doctrine enables copyrighted works to be used by third parties without the copyright holder’s consent in some circumstances, such as when illustrating a point in a news article. AI companies trying to make the case for the use of copyrighted works to train their generative AI models commonly invoke fair use. But authors and other creative industry plaintiffs have been pushing back.
“This landmark settlement will be the largest publicly reported copyright recovery in history”, the settlement motion states, arguing that it will “provide meaningful compensation” to authors and “set a precedent of AI companies paying for their use of pirated websites.”
“This settlement marks the beginning of a necessary evolution toward a legitimate, market-based licensing scheme for training data”, said Cecilia Ziniti, a tech industry lawyer and former Ninth Circuit clerk who is not involved in this specific case but has been following it closely. “It’s not the end of AI, but the start of a more mature, sustainable ecosystem where creators are compensated, much like how the music industry adapted to digital distribution.”A case with split rulings
Authors Andrea Bartz, Charles Graeber and Kirk Wallace Johnson filed their complaint against Anthropic for copyright infringement in 2024. The class action lawsuit alleged Anthropic AI used the contents of millions of digitized copyrighted books to train the large language models behind their chatbot, Claude, including at least two works by each plaintiff.
