Second Ruling this Week on AI and Copyright Law

As detailed in our recent article, a federal judge in the Northern District of California issued a landmark order in Bartz et al. v. Anthropic (3:24-cv-05417) on June 23, 2025, entering summary judgment in favor of Anthropic, a large language model (“LLM”) artificial intelligence company, on the basis that Anthropic’s use of certain authors’ books to train Anthropic’s large language model AI service, Claude, did not violate the authors’ copyrights because such use constituted “fair use” under Section 107 of the Copyright Act.

The Bartz Court’s order decided that, as to legitimately purchased books, three of the four factors for determining fair use (purpose and character of use, amount and substantiality of the portion used in relation to the copyrighted work as a whole, and effect of the use upon the market for or value of the copyrighted work) weighed in favor of a determination of fair use, while only one factor (nature of the copyrighted work) did not.

While the Bartz Court took a dim view of Anthropic’s use of stolen (pirated) copyrighted works to train its LLM service, the Bartz Court overall seemed impressed with the potential benefits of AI technology, acknowledging that the LLM AI technology at issue “was among the most transformative many of us will see in our lifetimes.” (Order at p. 30, ll. 23-24.)

California Court Order More Skeptical on LLM AI

Just two days after that order, on June 25, 2025, another federal judge in the Northern District of California issued an order on a similar issue in Kadrey v. Meta Platforms, Inc. (3:23-cv-03417).

The court in Kadrey also entered summary judgment for the defendant, on the similar basis that tech giant Meta’s use of certain authors’ books to train Meta’s large language model AI service did not violate the authors’ copyrights because such use also constituted “fair use” under Section 107 of the Copyright Act. However, the Court’s order in Kadrey differs from the order in Bartz in one key aspect: the Kadrey Court expresses a more skeptical view of LLM AI technology. Specifically, the Court opens its order by stating:

Companies are presently racing to develop generative artificial intelligence models — software products that are capable of generating text, images, videos, or sound based on materials they’ve previously been “trained” on. Because the performance of a generative AI model depends on the amount and quality of data it absorbs as part of its training, companies have been unable to resist the temptation to feed copyright-protected materials into their models — without getting permission from the copyright holders or paying them for the right to use their works for this purpose. This case presents the question whether such conduct is illegal.

. . .

Although the devil is in the details, in most cases the answer will likely be yes.

(Order at p. 1.) And in its conclusion, the Kadrey Court states: “In cases involving uses like Meta’s, it seems like the plaintiffs will often win[.]” (Order at p. 39.) The Kadrey Court acknowledged Meta’s use of the works at issue was “highly transformative,” thus the Court advised that the plaintiffs needed to win decisively on the fourth factor of the fair use test (market effects). (Order at p. 40.)

While “the plaintiffs presented no meaningful evidence on market dilution at all,” the Kadrey Court indicated it might have denied Meta’s motion for summary judgment “had the plaintiffs presented any evidence that a jury could use to find in their favor on the issue [of market dilution].”

The Future of AI and Copyright Law

The Kadrey Court’s order may provide guidance for other plaintiffs who claim an AI service’s use of their works (such as music recordings, video recordings, and books) violated their copyrights. And difference in tone between the Bartz and Kadrey Courts’ orders indicates that not all courts will be equally impressed by the potential benefits of AI.

Ultimately, as more cases on this issue are litigated, these differences of judicial opinion may create a circuit split, necessitating guidance from the Supreme Court of the United States. Only time will tell.

With the evolution of LLM AI models and their ease of use, there will be many more concerns about their use in the future. If you have questions about intellectual property law, including copyright, and artificial intelligence, the attorneys of Riley Bennett Egloff are available to assist you.

© Riley Bennett Egloff LLP

Disclaimer: Article is made available for educational purposes only and is not intended as legal advice. If you have questions about any matters in this article, please contact the author directly.

Permissions: You are permitted to reproduce this material in any format, provided that you do not alter the content in any way and do not charge a fee beyond the cost of reproduction. Please include the following statement on any distributed copy:  “By Justin O. Sorrell & Donald S. Smith © Riley Bennett Egloff LLP — Indianapolis, Indiana. www.rbelaw.com”

Posted on June 26, 2025 by Justin O. Sorrell