Recent Legal Developments in Artificial Intelligence and Intellectual Property

Here’s an update on recent legal developments involving artificial intelligence (AI) and intellectual property (IP).

Human Authorship and Copyright

The DC Circuit Court has affirmed the denial of copyright registration for work created via AI.

The case is Thaler v. Perlmutter.

According to Art News, AI developer Dr. Stephen Thaler created the DABUS system in his garage in 1992. “DABUS” stands for “Device for the Autonomous Bootstrapping of Unified Sentience.”

Thaler has spent years attempting to secure copyright or patent protection for works generated by DABUS and related tools in the US and other countries.

As the latest opinion explains, Thaler also created a generative artificial intelligence named the “Creativity Machine,” and the Creativity Machine generated a picture that Dr. Thaler titled “A Recent Entrance to Paradise.”

Thaler sought US copyright protection for the picture and, on the copyright application, listed the Creativity Machine as the work’s sole author.

The US Copyright Office denied the application on the grounds that it violated the requirement for human authorship.

The court affirmed the denial and held:

The Creativity Machine cannot be the recognized author of a copyrighted work because the Copyright Act of 1976 requires all eligible works to be authored in the first instance by a human being.

The court also found that Thaler himself could not be the author of the work because he’d waived that argument before the Copyright Office.

As the court explained,

The Constitution’s Intellectual Property Clause gives Congress authority to “promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries.” U.S. CONST. Art. I, § 8, cl. 8.

The reason for this, as the court explained, is that

Copyright law incentivizes the creation of original works so they can be used and enjoyed by the public. Since its founding, Congress has given authors short-term monopolies over their original work. See Act of May 31, 1790, ch. 15, 1st Cong., 1 Stat. 124. This protection is not extended as “a special reward” to the author, but rather “to encourage the production of works that others might reproduce more cheaply.”

The court noted that, even before the advent of generative AI (GAI) systems like ChatGPT, Copyright Office regulations have long required that any registered work be authored by a human.

Works cannot be protected by copyright if “produced by a machine or mere mechanical process that operates randomly or automatically without any creative input or intervention from a human author.”

Thaler argued that “the Human Authorship Requirement is unconstitutional and unsupported by either statute or case law.” He claimed that judicial opinions “from the Gilded Age” could not settle the question of whether computer-generated works are copyrightable today.

Thaler also argued that he should be deemed the owner of the AI-created work under the “work made for hire” doctrine.

As the court explained,

The Copyright Act’s work made-for-hire provision allows “the employer or other person for whom the work was prepared” to be “considered the author” and “own all of the rights comprised in the copyright.” 17 U.S.C. § 201(b).

The district court had held that Dr. Thaler could not rely on the work-made-for-hire provision because that provision “presupposes that an interest exists to be claimed.”

The circuit court noted that the “image autonomously generated” by the Creativity Machine was not such an interest because it “was never eligible for copyright.” Thus, the Machine had no copyright to transfer to Dr. Thaler even if he were the Creativity Machine’s “employer.”

The circuit court accepted that the Copyright Act does not define the word “author.” However, said the court,

traditional tools of statutory interpretation show that, within the meaning of the Copyright Act, “author” refers only to human beings.

Also, said the court,

Numerous Copyright Act provisions both identify authors as human beings and define “machines” as tools used by humans in the creative process rather than as creators themselves. Because many of the Copyright Act’s provisions make sense only if an author is a human being, the best reading of the Copyright Act is that human authorship is required for registration.

New York Times Copyright Infringement Case

While the Thaler case deals with copyright protection for AI outputs – what the AI generates – the New York Times case deals with AI inputs – the materials used to train GAI.

As NPR reported,

A federal judge on Wednesday rejected OpenAI's request to toss out a copyright lawsuit from The New York Times that alleges that the tech company exploited the newspaper's content without permission or payment.

The Times has joined with other publications and publishers, including The New York Daily News and the Center for Investigative Reporting, to challenge the unauthorized use of its copyrighted materials to train ChatGPT.

As NPR reported,

Lawyers for The New York Times believe that the paper's articles are one of the biggest sources of copyrighted text that OpenAI used to build ChatGPT into the premier AI chatbot, and they allege that OpenAI violated copyright laws in its siphoning of the newspaper's journalism.

OpenAI, the creator of ChatGPT, claims that its use of copyrighted material from the Times and other sources was legal within the scope of the “fair use” exception to copyright protection.

As the Copyright Alliance explains,

Fair use permits a party to use a copyrighted work without the copyright owner’s permission for purposes such as criticism, comment, news reporting, teaching, scholarship, or research. These purposes only illustrate what might be considered as fair use and are not examples of what will always be considered as fair use. In fact, there are no bright-line rules in determining fair use, since it is determined on a case-by-case basis. But copyright law does establish four factors that must be considered in deciding whether a use constitutes a fair use. These factors are:

• The purpose and character of the use, including whether such use is of a commercial nature or is for non-profit educational purposes;
• The nature of the copyrighted work;
• The amount and substantiality of the portion used in relation to the copyrighted work as a whole; and
• The effect of the use upon the potential market for or value of the copyrighted work.

Although one factor or another may weigh more heavily in a fair use determination, each of the factors must be considered, and no one factor alone can determine whether the use falls within the fair use exception.

The Times has argued that by creating near-verbatim versions of its articles, ChatGPT damages the market for the originals, reduces advertising revenues, and is thus outside the scope of fair use.

The case can now proceed to trial, but a trial date has not yet been set.