Anthropic judge rejects $1.5B AI copyright settlement

Summary

The federal judge overseeing Anthropic PBC’s proposed $1.5 billion copyright settlement is concerned class lawyers are striking a deal behind the scenes that will be forced “down the throat of authors.” Judge William Alsup at the hearing said the motion to approve the deal was denied without prejudice, but in a minute order after the hearing said approval is postponed pending submission of further clarifying information.During the first hearing since the deal was announced on Sept. 5, Alsup said he felt “misled” and needs to see more information about the claim process for class members. “I have an uneasy feeling about hangers on with all this money on the table,” he said.The agreement is “nowhere close to complete,” said Alsup of the US District Court for the Northern District of California.Authors’ counsel, Justin Nelson of Susman Godfrey LLP, assured Alsup that the attorneys “care deeply that every single proper claim gets compensation.”In an order docketed the evening before the hearing, Alsup said he was “disappointed” that the parties left “important questions” for the future, including a list of works covered by the deal and the processes for notifying potential class members. Those “critical choices” will need to be made before preliminary approval can be granted, he said.His criticism forces attorneys to recalibrate a proposed settlement touted as among the largest copyright deals in US history and a template for similar AI copyright litigation.Maria A. Pallante, president and CEO of the Association of American Publishers, said in a statement that the court “demonstrated a lack of understanding of how the publishing industry works.” The court “seems to be envisioning a claims process that would be unworkable, and sees a world with collateral litigation between authors and publishers for years to come,” she added. The deal would resolve authors’ class action over the AI company’s downloading of millions of pirated books, one of the first settlements of a cop...