Court Rejects Fair Use Claim on Landmark Ruling on AI and Copyright

Takeaway:?A U.S. court ruled that ROSS Intelligence’s use of Westlaw headnotes to train its AI was not fair use, emphasizing market harm and setting a precedent that could impact future AI copyright cases, especially regarding training data.

A U.S. district court ruled against ROSS Intelligence in Thomson Reuters v. ROSS Intelligence, the first major decision on fair use in AI-related copyright cases. The court found that ROSS’s use of Westlaw headnotes to train its AI-driven legal research tool was not fair use, setting a precedent that could impact future AI litigation. The court determined that ROSS had copied 2,243 Westlaw headnotes and rejected defenses such as innocent infringement and fair use.

While ROSS claimed its AI transformed the headnotes into numerical data, the court ruled that the use was not transformative since it served the same purpose as Westlaw. The ruling emphasized that ROSS’s commercial intent and direct competition with Westlaw weighed against fair use. A key factor in the decision was market harm. The court found that ROSS could have developed its AI without infringing on Westlaw’s copyrights and that its use of the headnotes posed a threat to Westlaw’s business. While the ruling does not directly address generative AI, it signals that courts may take a strict approach when AI companies use copyrighted material for training, making future litigation likely.