Microsoft Entangled in Legal Battle Over AI Training Data

Microsoft finds itself at the center of a legal controversy involving its partnership with OpenAI. The tech giant is being sued for its alleged role in using copyrighted material to train OpenAI’s artificial intelligence models.

Key Takeaways:

  • Microsoft is sued for its involvement with OpenAI in using copyrighted content for AI training.
  • The lawsuit highlights Microsoft’s significant role in developing and commercializing GPT-based technology.
  • Author Julian Sancton, who filed the suit, claims Microsoft’s Azure cloud computing was crucial for training OpenAI’s models.
  • The lawsuit follows Microsoft’s hiring of former OpenAI CEO Sam Altman.
  • Sancton’s complaint focuses on nonfiction and academic works, differing from previous suits mostly by fiction writers.
  • The suit alleges Microsoft and OpenAI made unlicensed copies of copyrighted works for AI training.
  • Microsoft’s Bing Chat and OpenAI’s integration of ChatGPT with Bing are mentioned as examples of their close collaboration.
  • The lawsuit questions the fair use defense often cited by AI companies in similar cases.

The Lawsuit’s Implications

Julian Sancton, the plaintiff, is a senior features editor at The Hollywood Reporter and author of the nonfiction book “Madhouse at the End of the Earth.” His lawsuit against Microsoft emphasizes the company’s deep involvement in the training, development, and commercialization of OpenAI’s GPT-based products. Sancton alleges that Microsoft’s Azure cloud computing systems were instrumental in training OpenAI’s AI models, a process that he claims involved the mass copyright infringement of authors’ works.

Microsoft and OpenAI’s Partnership

The lawsuit brings to light the intricate relationship between Microsoft and OpenAI. Microsoft’s role went beyond providing technical support; it also played a key role in the commercialization of GPT-based technology. This includes the launch of Bing Chat, a human-mimicking AI chatbot, and the integration of ChatGPT with Bing’s browsing features. The recent hiring of Sam Altman, former CEO of OpenAI, by Microsoft further cements their close partnership.

The Core of the Controversy

At the heart of the lawsuit is the claim that Microsoft and OpenAI made tens of thousands of unlicensed copies of copyrighted works for the purpose of training their AI system. This challenges the common defense used by AI companies that their training processes do not involve direct copying but rather the development of parameters from the works. The lawsuit argues that this practice is a “manifestly unfair use” of copyrighted material, potentially depriving authors of licensing agreements and revenue.

The Fair Use Debate

The lawsuit also tackles the contentious issue of fair use in the context of AI. It argues that the commercial nature of Microsoft and OpenAI’s use of copyrighted material undermines the fair use defense. This is particularly relevant following the Supreme Court’s decision in Andy Warhol Foundation for the Visual Arts v. Goldsmith, which narrowed the scope of fair use in copyright infringement cases.

Looking Ahead

This legal battle could have significant implications for the AI industry, particularly in how AI companies use copyrighted material for training their models. The outcome of this case could set a precedent for future copyright infringement suits involving AI and reshape the landscape of AI development and commercialization.


The lawsuit against Microsoft and OpenAI raises critical questions about the ethical and legal boundaries of using copyrighted material in AI training. As the case unfolds, it will be closely watched by the tech and legal communities for its potential to redefine the rules of engagement in the rapidly evolving AI sector.