(Raw Story Media Inc., et al. v. OpenAI Inc., et al., No. 24-1514, S.D. N.Y.)
(Raw Story plaintiffs’ motion for reconsideration with attachments available. Document #46-250507-046B.)
The motion was filed April 18.
Raw Story Media Inc. and Alternet Media Inc. filed suit on Feb. 28, 2024, in the District Court claiming that OpenAI Inc., OpenAI GP LLC, OpenAI LLC, OpenAI OPCO LLC, OpenAI Global LLC, OAI Corp and OpenAI Holdings LLC used data scraped from “most of the internet” to train their artificial intelligence, ChatGPT. ChatGPT will sometimes produce “nearly verbatim” works that are subject to copyright, the plaintiffs alleged. This includes times that it will “regurgitate verbatim or nearly verbatim copyright-protected works of journalism.” If a user asks ChatGPT for current events, it will at times “mimic significant amounts of material from copyright-protected works of journalism.” To the extent that ChatGPT was trained on journalism articles, it can re-create this information unless the defendants have specifically trained it to do otherwise. It will do so without crediting the author or title and without copyright notice or disclaimer, the plaintiffs said.
The plaintiffs allege that the defendants knew that users would broadcast ChatGPT results, at least in part because the defendants advertise and market ChatGPT as a tool to generate content that can then be put in front of additional audiences. Raw Story and Alternet alleged violation of Section 1202(b)(1) of the DMCA, 17 U.S.C. § 1202(b)(1).
Dismissal
U.S. Judge Colleen McMahon of the Southern District of New York granted a motion to dismiss. “Let us be clear about what is really at stake here. The alleged injury for which Plaintiffs truly seek redress is not the exclusion of CMI from Defendants' training sets, but rather Defendants' use of Plaintiffs' articles to develop ChatGPT without compensation to Plaintiffs. . . . Whether or not that type of injury satisfies the injury-in-fact requirement, it is not the type of harm that has been ‘elevated’ by Section 1202(b)(i) of the DMCA [Digital Millennium Copyright Act]. . . . Whether there is another statute or legal theory that does elevate this type of harm remains to be seen. But that question is not before the Court today,” Judge McMahon said.
Judge McMahon granted the motion to dismiss and denied the plaintiffs’ request to replead without prejudice to a proper filing that includes an explanation “why the proposed amendment would not be futile.” Judge McMahon said she agreed that the plaintiffs lacked article III, U.S. Const., art. III, standing to pursue the claim for damages or injunctive relief.
“I am not convinced that injury for interference with property provides the necessary ‘close historical or common-law analogue’ to Plaintiffs' alleged injury. For one thing, Plaintiffs are wrong that Section 1202 grant[s] the copyright owner the sole prerogative to decide how future iterations of the work may differ from the version the owner published. Other provisions of the Copyright Act afford such protections but not Section 1202. . . . Section 1202 protects copyright owners from specified interferences with the integrity of a work's CMI. In other words, Defendants may, absent permission, reproduce or even create derivatives of Plaintiffs' works — without incurring liability under Section 1202 — as long as Defendants keep Plaintiffs’ CMI intact,” Judge McMahon said.
The Raw Story plaintiffs moved for leave to file an amended complaint, which Judge McMahon denied in an April 3 decision and order. After that court issued its ruling, the Judicial Panel on Multidistrict Litigation consolidated several copyright lawsuits against OpenAI in the Southern District of New York.
New Circumstance
In their motion, the Raw Story plaintiffs say the creation of multidistrict litigation constitutes a change in circumstances sufficient for reconsideration of the ruling denying leave to amend.
When actions are transferred, the new court may override rulings of the transferee court, the Raw Story plaintiffs say. Further, given consistency and finality goals of an MDL, consolidated litigation motions for reconsideration are not always viewed with the same restraint. Reconsideration is warranted here because different courts have reached different conclusions about the importance of removal of CMI. Reconsideration would cure inconsistencies in this case with those transferred to the MDL, the Raw Story plaintiffs say.
Secondly, reconsideration will assist the judicial efficiency OpenAI sought in requesting an MDL, the Raw Story plaintiffs say. The plaintiffs say that should the court grant the motion for reconsideration in a reasonably timely fashion, they can participate in the scheduled MDL discovery. The plaintiffs say that if they are forced to appeal the ruling, by the time an appellate court issues an opinion, the MDL might be concluded. In that case, OpenAI would have to waste resources by going through discovery again.
“OpenAI cannot deny this. It moved for, and obtained, an MDL for precisely these reasons. Indeed, OpenAI’s success in obtaining an MDL for these purposes judicially estops it from objecting to these benefits of reconsideration,” the Raw Story plaintiffs tell the court.
Counsel
The Raw Story plaintiffs are represented by Jonathan Loevy, Michael Kanovitz, Stephen Stich Match, Thomas Kayes, Steven Art, Keyle Wallenberg and Shelley Geiszler of Loevy & Loevy in Chicago.
The defendants are represented by Joseph C. Gratz and Vera Ranieri of Morrison & Foerster LLP in San Francisco and Allyson R. Bennett and Rose S. Lee of its Los Angeles office.
(Additional documents available: April 3 ruling. Document #46-250507-051Z. Raw Story plaintiffs’ motion for leave to amend. Document #46-250507-047M. Raw Story plaintiffs’ memorandum in support. Document #46-250507-048B. OpenAI’s opposition. Document #46-250507-049B. Raw Story plaintiffs’ reply. Document #46-250507-050B. Nov. 7 decision and order. Document #46-241113-086Z. Raw Story, et al.’s complaint. Document #46-240306-052C.)