Copyright, Blockchain, and the Future of AI-generated Content
Cover: An anarcho-capitalist black and gold flag, held by Lady Liberty. By Libertatis. January 4, 2010. CC0 1.0. Source: Wikimedia Commons.
Maurício Pinheiro
The landscape of intellectual property is undergoing a profound transformation as generative AI models like ChatGPT reshape the way content is produced and disseminated. A brewing legal dispute between The New York Times and OpenAI has brought to light the intricate interplay between copyright protection, AI-generated content, and the emergence of blockchain technology as a potential solution.
In recent weeks, negotiations between The New York Times and OpenAI have escalated into the possibility of a lawsuit, spotlighting the evolving tensions around copyright infringement and AI-generated content. At the heart of the matter is the concern that AI models like ChatGPT are repurposing original content, thereby encroaching on intellectual property rights. With companies like Microsoft integrating ChatGPT into search engines, there’s a growing worry that AI-generated answers could deter users from visiting original content sources, thus impacting revenue streams for media organizations.
Generative AI models function by gathering data from across the internet, often without explicit authorization. This raises questions about the legality of data aggregation and its potential violation of copyright regulations. Federal law sanctions the removal of infringing content and imposes substantial financial penalties in case of infringement.
Daniel Gervais, an AI researcher and intellectual property expert, predicts that copyright issues will linger unless AI companies navigate these challenges. This underscores the urgency of addressing copyright concerns to ensure the fair and ethical use of AI-generated content.
As The New York Times explores potential legal avenues, it’s essential to consider the broader context of blockchain technology. Blockchain offers a decentralized and transparent system for recording transactions, which could potentially revolutionize copyright management. By recording content ownership and usage rights on a blockchain ledger, media organizations and creators can ensure accountability and fair compensation when their content is used in AI models.
A solution envisions a digital ecosystem where copyright rights are replaced by blockchain registers, fostering an unregulated free-trade environment on the web. Through blockchain, content creators could monetize their work directly, while AI companies could access a vast array of content while respecting ownership rights.
The legal precedents of “fair use” doctrine, such as Google’s book scanning case and the Andy Warhol Foundation case, will inevitably influence the upcoming copyright disputes involving AI. AI companies are likely to invoke “fair use” as a defense, asserting that their use of copyrighted material serves educational, critical, or research purposes.
Ultimately, the impending legal clash between The New York Times and OpenAI shines a spotlight on the evolving dynamics of copyright protection in the age of AI. It prompts us to explore innovative solutions like blockchain technology that could balance the interests of content creators, AI developers, and consumers in a new era of digital anarcocapitalism. As this landscape continues to unfold, collaborative efforts are crucial to shaping a future where AI-generated content respects intellectual property while embracing the potential of the digital frontier.
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Glossar
Fair Use Doctrine
The “fair use” doctrine is a legal principle that provides exceptions to copyright law, allowing limited use of copyrighted material without the need for permission from the copyright holder. This doctrine recognizes that certain uses of copyrighted works contribute to societal benefits, such as education, criticism, research, and news reporting. Fair use is based on the idea that not all uses of copyrighted material should be subject to strict copyright restrictions, as it serves the public interest in promoting free expression and innovation.
The four factors commonly considered in determining whether a use falls under fair use are:
- Purpose and Character of Use: Courts assess whether the use is transformative, meaning it adds new meaning or value to the original work. Uses that are for non-commercial, educational, or transformative purposes are more likely to be considered fair use.
- Nature of the Copyrighted Work: The nature of the copyrighted work is examined to determine if it is more factual or creative in nature. Uses of factual works are more likely to be deemed fair use.
- Amount and Substantiality of the Portion Used: The extent of the portion used in relation to the entire copyrighted work is considered. Using only a small portion, especially if it is not the “heart” of the work, is more likely to be considered fair use.
- Effect on the Market: Courts analyze whether the use negatively impacts the market value of the original work. If the use does not substitute for the original work or harm its potential market, it is more likely to be deemed fair use.
It’s important to note that fair use is a complex and nuanced legal concept, and each case is evaluated individually. It’s not an absolute right but rather a defense against copyright infringement claims. Determining whether a specific use qualifies as fair use involves a careful consideration of these factors and may involve legal proceedings. In the context of AI-generated content, companies and creators often invoke the fair use doctrine as a defense when using copyrighted material in their AI models, particularly for educational, research, or transformative purposes.
Google’s Book Scanning Case
The Google’s book scanning case refers to a legal dispute involving Google’s initiative to digitize and make available a vast collection of books through its Google Books Library Project. In 2004, Google began scanning millions of books from various libraries, allowing users to search for and view excerpts from these books online. However, this project faced legal challenges from authors and publishers who claimed that Google’s scanning without explicit permission constituted copyright infringement.
The case began in 2005, when the Authors Guild and several publishers filed a class-action lawsuit against Google, alleging that its book scanning project violated their copyrights. The case was initially settled in 2008, when Google agreed to pay $125 million to the plaintiffs and create a Book Rights Registry to distribute royalties to authors and publishers. However, this settlement was rejected by Judge Denny Chin in 2011, who found it unfair to the rights holders who did not opt out of the class action.
The case culminated in a landmark decision by the United States Court of Appeals for the Second Circuit in 2015. The court ruled that Google’s book scanning project fell under the “fair use” doctrine, allowing Google to continue digitizing books without obtaining permission from copyright holders. The court argued that Google’s use of scanned books was transformative in nature, providing a valuable research tool and not a substitute for the original books. The Second Circuit’s decision affirmed Judge Chin’s ruling in 2013, which granted summary judgment to Google on the basis of fair use.
The Google’s book scanning case has significant implications for the boundaries of fair use in the digital age. It established that transformative uses of copyrighted works, especially for educational and research purposes, can be considered fair use even if they involve scanning and digitizing entire books. This case has had a lasting impact on discussions surrounding the digitization of cultural heritage and the access to information in the digital realm. The Supreme Court declined to hear the case in 2016, effectively ending the legal battle and allowing Google to continue its book scanning project without further challenges.
Andy Warhol Foundation Case
The Andy Warhol Foundation Case pertains to a legal dispute involving the appropriation of a photograph by renowned American pop artist Andy Warhol to create a series of artworks. In 1964, photographer Lynn Goldsmith captured an image of music icon Prince, a photograph later licensed to Vanity Fair magazine in 1984. In 1984, Andy Warhol used this photograph as a basis to produce a series of paintings and silkscreens portraying Prince.
The controversy gained prominence in 2017 when the Andy Warhol Foundation for the Visual Arts filed a lawsuit against Lynn Goldsmith. The foundation sought a declaratory judgment stating that Warhol’s works did not infringe upon their copyright. Goldsmith, in turn, countersued, asserting that Warhol had copied her photograph without permission.
The initial outcome transpired in 2019 when the District Court for the Southern District of New York ruled in favor of the foundation, deeming Warhol’s works transformative and falling within the realm of “fair use.” However, this decision was overturned by the Second Circuit Court of Appeals in 2021, which concluded that Warhol’s works were not sufficiently transformative and infringed Goldsmith’s copyrights.
This Second Circuit’s decision was grounded in a reevaluation of a prior ruling, the Cariou v. Prince case (2013), which established that a secondary work is not necessarily transformative merely due to its distinct aesthetic from the original. The court emphasized that the purpose and meaning of the secondary work must diverge from the original, and the market impact of the secondary work must also be considered.
Importantly, the Supreme Court declined to hear the case in 2021, leaving the Second Circuit’s decision as the final word on the matter. The Andy Warhol Foundation Case also holds significant implications for the boundaries of the “fair use” doctrine and the discussion surrounding the appropriation of artworks in the contemporary era, highlighting the intricacies of evaluating the transformation of derivative works and the need to consider multiple factors when determining copyright infringement.
News
Report: Potential NYT lawsuit could force OpenAI to wipe ChatGPT and start over | Ars Technica
OpenAI Doesn’t Care about NYT Enough…because Google does.
New York Times Reportedly Considering Lawsuit That Could Throw OpenAI Into Chaos.
References
Appel, G., Neelbauer, J. and Schweidel, D.A. (2023) ‘Generative AI has an intellectual property problem’, Harvard Business Review, 7 April.
European Commission (2020) Study on copyright and new technologies. Luxembourg: Publications Office of the European Union.
Gervais, D.J. (2021) ‘The Human Cause’, Vanderbilt Law Research Paper No. 21-39, Forthcoming Chapter in Research Handbooks on Intellectual Property and Artificial Intelligence (R. Abbott, ed), pp. 1-25
Salah, K., Nizamuddin, N., Al-Fuqaha, A. and Guizani, M. (2019) ‘Convergence of blockchain, IoT, and AI’, Frontiers in Blockchain, 2(27), pp. 1-18.
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