The U.S. Department of Justice sided with AI corporations in a copyright infringement lawsuit that The New York Times (NYT) filed against OpenAI and Microsoft (MS).
According to the NYT on the 2nd (local time), the U.S. Department of Justice asked the court not to accept the NYT's claim that using NYT content to train large language models (LLMs) violates the Copyright Act, in a brief submitted to the U.S. District Court for the Southern District of New York the day before.
The Department of Justice is not a party to the lawsuit, but under U.S. court procedures, the government can submit a brief in cases involving the public interest.
In 2023, the NYT filed suit claiming OpenAI and MS used millions of its articles without permission to train AI models such as ChatGPT and Copilot. The NYT sought damages and demanded an end to the unauthorized use of its content for AI training.
However, the Department of Justice viewed the use of works in AI model training as "transformative" for a new purpose and therefore falling under "fair use" permitted by the Copyright Act.
Fair use is a principle under the Copyright Act that exceptionally allows the use of a work without the copyright holder's permission depending on factors such as the purpose and manner of use and the effect on the market for the original work.
The Department of Justice in particular framed the development of the AI industry as a matter directly tied to U.S. national security. Deputy Attorney General Stanley Woodward said on social media that "the administration will never allow the United States to be placed at a disadvantage to foreign adversaries because of a plainly incorrect interpretation of the Copyright Act."
The Department of Justice also expressed opposition to requiring AI corporations to pay mandatory licensing fees for using news content. It said massive licensing expense could limit competition in the LLM market and block market entry by smaller AI corporations with less capital.
The Department of Justice argued that mandating payment of content fees could result in large technology companies that can bear massive licensing expense oligopolizing the LLM market.
It also noted that such a system could grant excessive benefits to existing major media companies.
The NYT pushed back immediately. NYT Spokesperson Graham James criticized, saying, "The government is siding with a handful of AI corporations with corporate values totaling trillions of dollars at the expense of countless American creators whose works have been misappropriated."
He added, "AI and creators can both thrive. AI corporations should simply pay fair compensation for the content that makes their products possible."