Observed Signal · Sep 2, 2026 · Policy Update · Source: techcrunch · Impact: 3/5 · Sentiment: Positive
US Government Sides With OpenAI in Copyright Training Lawsuit
The Trump administration has filed a 20-page legal brief in the copyright lawsuit brought by The New York Times against OpenAI, arguing that AI companies should be allowed to train large language models on copyrighted material without explicit permission. The brief asserts that the United States has a strong interest in maintaining global leadership in artificial intelligence and warns against constraining LLM development under what it calls a misunderstanding of fair use doctrine. It is not a ruling; the case is pending in the U.S. District Court for the Southern District of New York. The intervention could influence the ongoing fair-use debate, which centers on whether training AI on copyrighted works is transformative. The article also notes a related case in which Anthropic was ordered to pay a $1.5 billion settlement to writers, but the penalty was tied to its use of illegal shadow libraries, not to the act of training models on copyrighted texts.
US government intervention in a landmark AI copyright case could shape fair-use precedent for training large language models, influencing AI development across the technology and advertising industries.
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Key Takeaways & Evidence Grounding
- The Trump administration filed a 20-page brief in The New York Times v. OpenAI lawsuit supporting OpenAI's unlicensed use of copyrighted works for AI training.
- The brief argues the United States has a strong interest in retaining global leadership in artificial intelligence.
- The case is being tried in the U.S. District Court for the Southern District of New York; the brief is not a ruling.
- A prior ruling ordered Anthropic to pay a $1.5 billion copyright settlement to writers, but the penalty was for using illegal shadow libraries, not for AI training itself.
Connected Companies & Entities
3 Entities mapped“OpenAI is the defendant in a copyright lawsuit filed by The New York Times over unlicensed use of copyrighted material to train its LLMs.”
“The New York Times filed a lawsuit against OpenAI over the use of its copyrighted material to train AI models.”
“Anthropic was ordered to pay a $1.5 billion copyright settlement to a group of writers whose works were used to train its AI models.”
Ontology Mapping & Concepts
Related Market Signals & Shifts
Recent verified developments and strategic activity across this market segment.
OpenAI Defends AI Training as Fair Use
OpenAI has published excerpts from amicus curiae briefs filed by various groups and individuals in support of its position that training AI models on copyrighted works constitutes fair use. The briefs, submitted in the copyright lawsuit brought by The New York Times, argue that AI training is transformative and does not harm the market for original works. Supporters include non-profit organizations like Public Knowledge, trade associations like the Consumer Technology Association, and prominent individuals such as Pulitzer Prize-winning journalist Ron Suskind and author Kevin Kelly. The submissions emphasize the broader societal benefits of AI, including accessibility, medical research, and innovation, and argue that restricting fair use would stifle progress. The U.S. government's brief also cautions against narrowing fair use doctrine, highlighting potential harm to American prosperity and scientific advancement.
Legal Complexity of Training AI on Copyrighted Books
Courts and legal experts remain divided over whether training large AI models on copyrighted books constitutes infringement. Recent rulings have produced mixed signals: Judge William Alsup ordered Anthropic to pay a $1.5 billion settlement to writers but ruled the company’s model training itself lawful, penalizing the use of pirated “shadow libraries.” Other cases, such as Thomson Reuters v. Ross Intelligence, found that copying proprietary content to build a competing AI product was not fair use. The 1976 Copyright Act has not been updated for modern AI use-cases, so judges are applying century-old doctrines—especially the fair-use “transformative” test—to novel technical processes. Legal uncertainty persists (including questions about the copyrightability of fully AI-generated works), and ongoing litigation will continue to shape industry practices for model training and content use.
NYT-Opening Documents Reveal AI Scraping, Fair-Use Impact on Publishers
Newly unsealed documents in The New York Times' lawsuit against OpenAI and Microsoft reveal internal admissions that AI products are 'largely substitutive' and pose an 'existential threat' to publishers. Legal experts say this eviscerates the fair-use defense, especially given evidence of paywall circumvention, which may violate the DMCA. The filings could catalyze more publisher lawsuits and force AI companies into paid licensing markets. Executives from OpenAI, Microsoft, and other AI firms are shown acknowledging the commercial value of news content while using it without permission. The case, presided over by Judge Sidney Stein, may set precedent for AI training on copyrighted works, reshaping the terms of trade between AI and publishing.
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