Alerts6.30.25
Federal Courts Issue First Key Rulings on Fair Use Defense in Generative AI Copyright Claims
Highlights
- The courts held that training large language models (LLMs) on copyrighted materials can be “transformative,” a central consideration in the fair use analysis.
- However, the judges diverged on the legal significance of that finding, particularly when weighted against potential market harm to authors.
- One court found fair use in training LLMs with legally acquired content, but not with pirated materials.
- Another court emphasized potential market dilution as a decisive factor, despite granting summary judgment based on evidentiary failings.
- Companies developing or deploying generative AI tools should carefully review these rulings to assess risk and refine litigation strategies.
Until last week, federal courts handling copyright infringement claims against AI companies had not decided whether developers’ primary legal shield — the “fair use” defense absolving one from liability — could apply in litigation involving generative AI.
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