Wholestory

Concord, Universal Music Publishing Group and ABKCO filed a 71-page Second Amended Complaint against Anthropic in the Northern District of California, drawing on internal records obtained in discovery — including an alleged co-founder query for Bob Dylan lyrics and a decision to use an extraction tool that stripped copyright notices — and seeking statutory damages up to $150,000 per work. It follows a separate January 2026 suit by the same publishers covering more than 20,000 songs and seeking over $3 billion for alleged torrenting of lyrics.

Google and Character.AI agreed to a mediated settlement in principle resolving Megan Garcia's wrongful-death claims over Sewell Setzer III, together with related minor-harm suits from families in Colorado, Texas and New York; terms were not disclosed. The settlements followed the May 2025 denial of dismissal, a Texas attorney-general investigation, a September 2025 Senate hearing at which Garcia testified, and Character.AI's October 2025 move to bar under-18 users from open-ended chats.

In the UK, the High Court (Mrs Justice Joanna Smith) largely ruled for Stability AI, holding that a model such as Stable Diffusion, which does not store or reproduce the copyrighted works, is not an "infringing copy." The framing of the result as a sweeping AI "win" understated what happened: Getty had voluntarily withdrawn its main training-copyright claim mid-trial because the training occurred outside the UK, and the court actually ruled for Getty on some trademark (watermark) claims.

One year after vetoing SB 1047, Governor Newsom signed SB 53, the Transparency in Frontier Artificial Intelligence Act — also authored by Senator Wiener and the first state frontier-AI safety law in the nation. It requires large frontier developers to publish a safety framework, report critical safety incidents to the Office of Emergency Services, and protect whistleblowers, with civil penalties enforceable by the attorney general, and it establishes the CalCompute public computing consortium. A narrower, transparency-focused successor to the bill Newsom had rejected.

Anthropic agreed to pay about $1.5 billion to settle the Bartz class action over pirated books used to train Claude — the largest copyright recovery on record and the first major AI-era settlement. It covers an estimated 500,000 works at roughly $3,000 each, with Anthropic also agreeing to destroy the downloaded files, resolving the piracy liability that survived Alsup's June ruling and averting the December trial. Court filings had shown Anthropic downloaded more than 7 million books it knew were pirated (from Books3, LibGen and the Pirate Library Mirror) before shifting to buying and scanning physical books.

Getty Images filed a notice of voluntary dismissal without prejudice of its Delaware copyright suit against Stability AI, stating it intended to refile in the Northern District of California to move faster. Defendants had filed no answer or summary-judgment motion. The Delaware docket's termination was Getty's own venue-driven withdrawal, not a ruling on the merits.

The second major application phase of the EU AI Act began: obligations for general-purpose-AI models, the governance framework, rules on notified bodies, confidentiality and penalties started to apply. Providers of GPAI models already on the market before this date have until 2 August 2027 to comply.

The White House released America's AI Action Plan, the strategy mandated by EO 14179, organized around three pillars: accelerating innovation by removing regulation and promoting open-weight models; building AI infrastructure through faster data-center, semiconductor and grid permitting; and leading in international AI diplomacy while tightening compute export controls. It is policy direction, not law, and marks the deregulatory turn from the Biden-era order.

The European Commission published the General-Purpose AI Code of Practice — a voluntary tool drafted by independent experts in three chapters (Transparency, Copyright, and Safety and Security) to help GPAI providers show compliance with the AI Act. The Commission and AI Board confirmed it as an adequate compliance route; more than twenty providers signed, though some (notably xAI) signed only the Safety and Security chapter. Published after the Act's 2 May statutory readiness date.

Two days after Bartz, Judge Vince Chhabria granted Meta summary judgment that training Llama on books was fair use — but "on this record" only, and reluctantly, faulting the thirteen author-plaintiffs for failing to develop a market-harm case and noting Llama could not reproduce more than trivial snippets. He expressly disagreed with Alsup on pirated "shadow library" copies and rejected the "teaching children to write" analogy. The paired June rulings left US fair-use law genuinely unsettled.

In Bartz v. Anthropic (N.D. Cal., No. 24-cv-5417), Judge William Alsup ruled on summary judgment that training Claude on books was "exceedingly transformative" fair use, and that digitizing lawfully purchased print books for training was also fair use. But he held that Anthropic's acquisition and retention of a permanent library of pirated books was not fair use, preserving liability for the piracy and setting a December 2025 trial on damages. In July the court certified a class for the piracy claim only, so the fair-use-on-training holding bound just the three named plaintiffs.

Governor Greg Abbott signed the Texas Responsible Artificial Intelligence Governance Act (TRAIGA / HB 149). A pared-back version of an earlier draft, it bars government use of AI for social scoring and non-consensual biometric identification, prohibits AI intentionally designed to cause harm, incite crime, or produce unlawful sexual content, amends Texas biometric and privacy law, creates a Texas AI Council and sets up a regulatory sandbox. Enforcement is by the attorney general, with a 60-day cure period.

Shira Perlmutter sued President Trump over her firing, arguing it was unconstitutional because the Copyright Office and Library of Congress sit within the legislative branch; the administration countered that the removals were lawful under the Federal Vacancies Reform Act. A federal judge denied her request for a temporary restraining order, with further hearings set for July 2025 — leaving the leadership of the US copyright system contested.

The Florida federal court denied the motion to dismiss the Garcia suit against Character.AI, Google and the founders, ruling the claims legally viable. The court questioned whether chatbot outputs are protected speech under the First Amendment, treated the AI system as a "product" for product-liability purposes, and kept the co-founders as defendants — an early, closely watched precedent for AI liability.

Register of Copyrights Shira Perlmutter was fired on 10 May 2025 — one day after the Part 3 AI report's release, and two days after Librarian of Congress Carla Hayden was dismissed. The administration named DOJ officials Todd Blanche as Librarian and Paul Perkins as Register; the Office then paused issuing roughly 20,000 registration certificates for about 12 business days. NPR reported the sequence between the report and the firing without asserting causation.

The U.S. Copyright Office released a "pre-publication version" of Part 3 of its AI report, on using copyrighted works to train generative AI. Its central conclusion: many training uses are likely transformative, but fair use turns case-by-case on the works used, the source, the purpose and output controls. The report introduced a "market dilution" concern — that AI output competing in the same market can harm the market for originals even without direct copying. Observers called the unusual pre-publication release, issued with a final version promised, unprecedented.

In Thomson Reuters v. ROSS Intelligence, Judge Stephanos Bibas (sitting in the District of Delaware) granted Thomson Reuters summary judgment on direct copyright infringement and rejected ROSS's fair-use defense — the first US merits ruling on fair use in an AI case. The court found ROSS copied 2,243 Westlaw headnotes, held the headnotes and Key Number System copyrightable, and found fair-use factors one (purpose) and four (market effect) favored Thomson Reuters, recognizing a potential market for AI training data. The ruling concerned non-generative AI, limiting how far it reaches.

The first application phase of the EU AI Act began: the bans on unacceptable-risk practices — such as government and commercial social scoring and certain manipulative or biometric-categorization uses — plus AI-literacy obligations, started to apply across the Union.

The U.S. Copyright Office published Part 2 of its AI report, addressing when works created with generative AI can be copyrighted — reaffirming that purely AI-generated output without sufficient human authorship is not protectable while human-arranged or -modified works may be.

President Trump signed EO 14179, "Removing Barriers to American Leadership in Artificial Intelligence" (published 31 January 2025, 90 FR 8741). It treats EO 14110 as revoked, directs agencies to suspend, revise or rescind actions taken under it that obstruct US "AI dominance," orders OMB to rewrite its AI memoranda within 60 days, and commissions an AI Action Plan within 180 days.

On his first day in office, President Trump revoked Executive Order 14110 through EO 14148 ("Initial Rescissions of Harmful Executive Orders and Actions"), erasing the reporting mandates and agency directives that had been the core of US federal AI policy. The single largest reversal of AI governance in the record — a governance-as-announced-versus-enforced turning point.

A federal court approved a stipulation requiring Anthropic to maintain guardrails meant to stop its Claude model from reproducing copyrighted song lyrics, in the suit brought by music publishers Concord, Universal Music Publishing Group and ABKCO over some 500 songs (filed October 2023). It resolved only the injunction question; in March 2025 the court denied the publishers a preliminary injunction against training, finding any harm compensable by damages, and the case continued into discovery.

Megan Garcia filed a wrongful-death and product-liability suit in Florida federal court against Character.AI, Google and Character.AI's co-founders after the suicide of her 14-year-old son, Sewell Setzer III, alleging the chatbot's anthropomorphic design was defective and unsafe for minors. The first major suit framing an AI companion product as a defective product in a user's death.

Governor Gavin Newsom vetoed SB 1047, the Safe and Secure Innovation for Frontier Artificial Intelligence Models Act by State Senator Scott Wiener, which would have required developers of the largest frontier models to build in safety protocols including full-shutdown capability and submit to audits against "critical harms." The same day he signed AB 2013, requiring public disclosure of generative-AI training-data summaries (effective 2026), and SB 896, directing state risk analysis of GenAI threats to critical infrastructure. The veto was the year's pivotal moment in US frontier-AI regulation.

The FTC announced Operation AI Comply, a law-enforcement sweep against five operations using AI to power deceptive or unfair conduct — most notably DoNotPay, marketed as "the world's first robot lawyer," which per the complaint never tested whether its output matched a human lawyer's and hired no attorneys; DoNotPay settled for $193,000 with a notice requirement. Others (Ascend Ecom, Ecommerce Empire Builders, FBA Machine, Rytr) faced complaints, receiverships or bars. The sweep established that there is no AI carve-out from consumer-protection law.

The Council of Europe Framework Convention on Artificial Intelligence — the first-ever international legally binding treaty on AI — was opened for signature. It sets principles of human dignity, non-discrimination, privacy, transparency, accountability and reliable, safe innovation, with remedies, procedural safeguards and risk assessments, and lets authorities impose bans or moratoria ("red lines") on certain applications. It binds only once ratified; early signatories included the EU, US, UK, Canada, Japan, Israel and Ukraine.

US District Judge William Orrick denied Stability AI's and Midjourney's motions to dismiss the artists' copyright claims in Andersen v. Stability AI, finding both direct and induced-infringement claims plausible and letting the case proceed to discovery. Trial was later set for September 2026, keeping the image-generation copyright question alive alongside the text cases.

The European Union's Artificial Intelligence Act entered into force — the first comprehensive, horizontal legal framework for AI anywhere, built on a risk-based approach (minimal, limited/transparency, high and unacceptable risk). Proposed by the Commission in April 2021 and agreed by Parliament and Council in December 2023, its obligations apply on a staggered timeline: prohibited practices first, then general-purpose-AI and governance rules, with high-risk-system requirements last.

The U.S. Copyright Office published Part 1 of its report "Copyright and Artificial Intelligence," addressing digital replicas and recommending a new federal digital-replica law. It was the first installment of a three-part study that would become central to the US copyright debate — and, with Part 3, to a governance crisis inside the Office itself.

Governor Jared Polis signed SB24-205, the Colorado AI Act, making Colorado the first US state to enact broad legislation governing high-risk AI and algorithmic discrimination in "consequential decisions" — employment, housing, credit, education and healthcare. It requires developers and deployers to use "reasonable care" against discrimination, complete impact assessments, disclose to consumers and offer appeal rights; the attorney general has exclusive enforcement. Operative obligations were later delayed, initially to 2026.

The UN General Assembly adopted, without a vote, a US-led resolution promoting "safe, secure and trustworthy" AI — the first time the Assembly addressed AI governance. Co-sponsored by more than 120 member states, it emphasizes human-rights protection and closing the digital divide. It is recommendatory only, carrying no binding force.

In Moffatt v. Air Canada (2024 BCCRT 149), the British Columbia Civil Resolution Tribunal held Air Canada liable for negligent misrepresentation after its website chatbot gave passenger Jake Moffatt incorrect advice about claiming a bereavement fare retroactively, and awarded C$812.02. The first widely cited ruling holding a company legally responsible for its AI chatbot's statements to a customer.

The New York Times sued OpenAI and Microsoft in the Southern District of New York, alleging millions of Times articles were copied without authorization to train ChatGPT and related models that now compete with the Times. The complaint seeks no fixed figure but says defendants should be liable for "billions of dollars" in statutory and actual damages and asks the court to order destruction of models and training data built from Times material. It was the first major American news organization to bring such a suit.

The FTC filed a complaint and proposed order in the Eastern District of Pennsylvania banning Rite Aid from using facial-recognition technology for surveillance for five years, to settle charges it deployed the technology from 2012 to 2020 in hundreds of stores without reasonable safeguards — generating thousands of false matches that led staff to wrongly accuse, search, eject and call police on customers, disproportionately in non-white and lower-income neighborhoods. The first major US enforcement order over a deployed AI system.

President Biden signed Executive Order 14110, "Safe, Secure, and Trustworthy Development and Use of Artificial Intelligence" (published in the Federal Register 1 November 2023, 88 FR 75191). It imposed mandatory Defense Production Act reporting on developers of dual-use foundation models — training activities, model-weight security and red-team results — for models trained above 10^26 operations (10^23 for biological-sequence data) or clusters above 10^20 operations/second, and directed NIST to write red-teaming guidance and the Department of Energy to build model-evaluation testbeds for nuclear, bio, chemical and cyber threats. The foundational US federal AI action, and the one later reversals would be measured against.

Microsoft announced its Copilot Copyright Commitment: if a third party sues a commercial customer for copyright infringement over the use of Microsoft's Copilots or their output, Microsoft will defend the customer and pay adverse judgments or settlements — provided the customer used the built-in guardrails and did not try to generate infringing material. In November 2023 it expanded the pledge (as the Customer Copyright Commitment) to Azure OpenAI Service outputs. A private-ordering response to legal uncertainty, not law.

China's Interim Measures for the Management of Generative AI Services took effect (promulgated 10 July 2023 by the Cyberspace Administration of China and six other ministries) — among the world's first binding national rules aimed specifically at generative AI. They require providers of public services to use lawful training data, uphold "Core Socialist Values" and bar content undermining state power, label AI-generated images and video, and — for services with "public opinion properties or the capacity for social mobilization" — pass security assessments and file their algorithms.

New York City's Department of Consumer and Worker Protection began enforcing Local Law 144, barring employers from using an automated employment decision tool unless it has passed an independent bias audit within the prior year, the audit results are posted publicly, and candidates are notified. It was the first US law to put an enforced compliance obligation on algorithmic hiring tools.

The Federal Trade Commission issued a policy statement warning that misuse of biometric information — including facial recognition — may violate the FTC Act, and that false or unsubstantiated claims about the accuracy of biometric technologies are actionable. It was the "announced" precursor to the agency's first major AI enforcement action seven months later.

Getty Images (US) filed a copyright and trademark complaint against Stability AI in the U.S. District Court for the District of Delaware (No. 1:23-cv-00135), alleging Stability copied more than 12 million Getty photographs — with captions and metadata — to train Stable Diffusion, and that the model reproduces distorted Getty watermarks. Claims were brought under the Copyright Act, the Lanham Act and Delaware unfair-competition law, with copyright-management-information removal alleged and a jury demanded.

The National Institute of Standards and Technology published the AI Risk Management Framework 1.0 (NIST AI 100-1), developed through a consensus-driven public process. The framework is explicitly voluntary and non-sector-specific — guidance rather than binding rule — and later became the reference NIST was directed to build on under Executive Order 14110.

Sarah Andersen and other visual artists filed a class-action copyright suit against Stability AI, Midjourney and DeviantArt in the U.S. District Court for the Northern District of California, alleging their works were used without permission to train image-generation models. It was among the first US cases to test whether training generative AI on copyrighted works is infringement.