The First Big A.I Copyright Ruling Has Landed
Future Rise Newsletter #29 | Aug 26th (2025)
A federal judge recently handed down the first major legal decision on
A.I training and copyright. And it's a big moment for the future of
how machines learn. The short version is this: A.I companies like
Anthropic are now legally allowed to train their models on copyrighted
materials, but only if they acquire the material legally.
The case was brought by three authors who found that their books had
been used to train Claude, Anthropic's large language model. The
court ruled that training on copyrighted content is considered
fair use if the books were bought and scanned. Because A.I is not
replicating or redistributing the work directly, the usage was ruled as
transformative. Think of it like SparkNotes: it's not a copy of the
book, but a summarized understanding built from it.
The judge even used a powerful metaphor. Training A.I on a large
library of books is not all that different from a teacher assigning
students to read novels so they can learn to write. It's a process of
transformation, not duplication.
But…there's a catch! Fair use only applies when the source material is
obtained legally. And Anthropic reportedly used over seven million
pirated books to train Claude. This part is not protected. A second trial
is set for December 2025 to deal with these allegations, and the
damages could reach hundreds of millions of dollars.
For now, this ruling is a partial win for A.I labs. It opens a legal path
forward for training datasets in the future, as long as they are
purchased and not scraped. But it also signals the possible end of the
scrape-now-ask-later era that has defined much of the A.I boom.
Actionable Insight
Plan for Possible Rising A.I Costs in Your Budget
With the possibility that A.I companies may be required to buy and
license content rather than scrape it, the cost of training data may rise.
And these costs are likely to be passed on to clients.
It means that we should be aware of possible higher A.I costs when we
formulate our upcoming budgets and ROI projections.
Until next time...keep future rising