U.S. appeals court sides with Thomson Reuters in landmark copyright battle over AI training

A U.S. appeals court on Tuesday upheld the ruling in favour of Thomson Reuters in its copyright dispute with former legal-search rival Ross Intelligence, as Reuters reports. The 3rd Circuit Court of Appeals in Philadelphia rejected Ross’s argument that its search engine made “fair use” of material from Thomson Reuters’ Westlaw platform.

This is the first ruling of its kind by a U.S. appeals court in the wave of high-stakes lawsuits over copyrighted material used to train artificial intelligence, according to Reuters’ reporting. The court’s reasoning is for now sealed, closed to the public.

Thomson Reuters’ 2020 lawsuit accused Ross Intelligence of copying Westlaw’s “headnotes” — summaries of legal points in court decisions — and misusing thousands of them to train its competing AI-based legal search engine. Ross shut down its platform in 2021, citing the costs of Thomson Reuters’ lawsuit, as Reuters reports.

A federal judge in Delaware last year rejected Ross’s “fair use” defence, pushing the company towards the appeal. According to the judge, “Ross took the headnotes to make it easier to develop a competing legal search tool. So Ross’s use is not transformative.”

The context is broad: authors, media outlets, record labels and others have filed dozens of lawsuits against tech companies over the unauthorised use of copyrighted works to train AI systems. The Thomson Reuters case is the first of its kind to reach an appeals court, although unlike the other disputes, this case does not involve generative AI, according to Reuters.

Tech companies argue that generative AI systems make fair use by transforming the material, while rights holders say the companies use their works to produce competing content. (Thomson Reuters is the parent company of Reuters News.)