Anthropic Settles Authors’ Class Action Piracy Lawsuit for Undisclosed Sum
Anthropic has reached a settlement in a class-action lawsuit brought by a group of authors, avoiding a potentially massive financial penalty. The case centered on the company’s use of copyrighted materials to train its artificial intelligence models. The terms of the settlement were not disclosed, but it resolves a significant legal threat for the AI developer.
The lawyer representing the authors, Justin Nelson, called it a historic settlement that will benefit all class members. He stated that details of the agreement are expected to be announced in the coming weeks.
The lawsuit had been navigating a complex legal landscape. In a previous ruling in June, Judge William Alsup delivered a mixed outcome. He ruled that Anthropic’s act of training its large language models on copyrighted texts likely constituted fair use. However, the judge also found that the company’s method of obtaining those materials could be pursued as a case of piracy. This distinction opened the door for the authors to seek statutory damages.
This ruling had placed Anthropic in a position of considerable financial risk. US copyright law sets statutory damages for piracy starting at 750 dollars per infringed work. With the plaintiffs alleging Anthropic’s training library contained an estimated 7 million pirated books, the company was potentially facing liability running into the billions of dollars. The settlement allows Anthropic to sidestep this enormous financial uncertainty.
This case is part of a broader, ongoing legal battle across the tech and creative industries regarding AI and copyright law. Clear legal precedents have yet to be established, leaving many companies to navigate these waters through litigation and settlement. This is not Anthropic’s first settlement related to its training data. The company was previously sued by members of the music industry in 2023 and reached a partial resolution earlier this year.
The final outcome of this settlement for both sides remains to be seen. Its impact will largely depend on the specific financial terms, which are confidential, and how many authors ultimately come forward to make a claim. Depending on those details, either Anthropic or the class of authors could emerge feeling like the victor once the process is complete. For now, the settlement removes a major legal challenge for Anthropic as it continues to develop its AI technology.
