Copyright creators, including the pop culture Giants Walt Disney Company and Universal Studios Inc., recently sued several artificial intelligence media creators who are allegedly profiting from 100 years of copyright protection on hundreds of millions of dollars in songs.
Some suits may have benefits. A copy is copied. However, the theory of expansionism, asserted by copyright creators, was able to undermine core copyright principles aimed at expanding rather than creative expression, rather than expanding.
Worse, the theory threatens to cut off the burgeoning AI media generators while sacrificing a unique opportunity to cash out the creative boom generated by AI-USER.
Plaintiff’s perspective
Primarily, copyright creators claim that AI media generators are committing double-layered copyright infringement. It illegally copies the work during the input/learning stage, allowing users to create or create illegal derivative work during the output/generating stage.
Disney and Universal don’t punch their lawsuit. They are actively branding AI media generators as “the bottomless hole of typical copyright-free riders and plagiarism.”
Regarding the AI training phase, copyright creators claim they are scraping, downloading and reformatting huge amounts of images and text data from the web.
Copyright concerns
The copyright creator is literally correct. It is rarely necessary to violate the copyright owner’s rights. An unauthorized copy is sufficient. Also, unlike some foreign copyright frameworks, the United States does not exempt private use from technical copyright infringement, even if the copy is not shared with others.
But not all copies are illegal. AI training on copyrighted works could constitute fair use, a multifactor defense of joint infringers Du Jour.
Training innovative AI media generator models using copyrighted works is undoubtedly very transformative. The goal is to create something new, not replace the original work.
Therefore, AI training (and specific output) is not a replacement for the legitimate market for copyright creator intellectual property. For example, are fans really going to skip the installment of the next Marvel Cinematic Universe due to the image generated by Iron Man AI on the beach while sipping Mai Tai?
Policy concerns also exist. Copyright Act aims to fulfill its constitutional obligations to “promote the advancement of science and useful art.” AI is another tool for creators, and if overly limited, it suppresses creative expression.
And just because AI models model training on copyrighted works doesn’t always generate copyright intrusion work. All artworks created by AI, whether human, are inspired by previous works. Inspiration is different from infringement.
The courts have faced these AI training copyright concerns in the context of training AI models on copyrighted literary works. These include recent decisions involving Meta Platforms Inc. and the large-scale language model of human PBC.
Threat to AI
If a copyright creator succeeds in a lawsuit, the profitability of an AI media generator can be cratered.
Determining copyright ownership, placing copyright ownership positions, negotiating copyright licenses, managing license payments/loyalty, and establishing system protocols that identify and exclude unauthorized copyright works of countless images across the web are subject to impractical and economically imperative.
Even if that was possible, it appears that the consumer’s interest in AI media generators will likely remain at a lower consumer revenue due to creative restrictions, as the need to exclude unlicensed copyrighted works, the need to exclude the overall performance of the AI media media generator model, or both.
All this disproportionately affects small and growing AI developers who lack the resources to solve these copyright challenges at scale, limiting innovation and fostering an exclusive environment where only the largest AI players can compete.
Disney and Universal have asserted that AI media creators can easily stop the breach. But they don’t claim that AI media generators can stop cheaply or survive by doing it.
I missed the opportunity
The AI-Media-Generation Piracy conflict can be an opportunity to grow pie for everyone if it is not seen through a zero-sum lens.
Queue could be adopted from the music industry, which experienced the threat of existential copyright infringement in the 2000s. You can create Display-Rights organizations to track AI-generated content and monetize it for copyright creators via blanket licenses.
Congressional actions are necessary. However, this training and collaborative operational dispute requires long-term solutions. AI doesn’t go anywhere.
Cases are Disney Enterprises, Inc. v. Midjourney, Inc., Cd Cal. , No. 2:25-CV-05275, complaint 6/11/25; Bartzv. EnthropicPBC, Nd Cal. , No. 3:24-CV-05417, 6/23/25 has been decided. and Kadreyv. MetaPlatforms, Inc, Nd Cal. , No. 3:23-CV-03417, 6/25/25 have been decided.
This article is based on Bloomberg Act, Bloomberg Tax, Bloomberg Government, or its owner, Bloomberg Industry Group, Inc. It does not necessarily reflect the opinions of the
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Nicholas J. Schneider is a member (partner) of the Intellectual Property and Commercial Litigation Group of Eckert Seamans.
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