The legal pressure on generative AI developers continues to escalate. The Seattle Times and Newsday have officially filed a joint federal copyright infringement lawsuit against OpenAI and Microsoft. They accuse the tech giants of methodically scraping their news reporting without permission or financial compensation to train AI models.
The complaint was filed in the U.S. District Court for the Southern District of New York (via Reuters). The lawsuit alleges that OpenAI and Microsoft ingested copyrighted articles at scale—including stories protected behind digital paywalls—to train and operate commercial products like ChatGPT, Microsoft Copilot, and AI-powered Bing search features.
Paywalls, hallucinations, and economic impact
In the filing, the newspapers describe generative AI as a “snake eating its own tail.” They argue that training models on stolen reporting threatens the very existence of the journalism feeding them.
The publishers assert that AI tools reproduce full passages, closely paraphrase original reporting, and deliver direct answers to users. This cuts off referral traffic and digital advertising revenue while bypassing paid subscriptions.
Beyond lost web traffic, the complaint highlights how AI hallucinations create further harm by wrongly attributing false or fabricated information to the news outlets, as well as stripping out copyright management information from articles.
Seattle Times President and CEO Alan Fisco said in a memo to employees that the company feels an obligation to defend content that costs millions of dollars a year to produce.
Seeking dataset destruction amidst an industry split
The Seattle Times and Newsday are asking the federal court for monetary damages and an order requiring the destruction of all training datasets, copies, and AI models incorporating their copyrighted work.
The case mirrors the ongoing landmark lawsuit filed by The New York Times in late 2023. There is also similar legal action taken by CNN against Perplexity.
The filings highlight a growing split across the publishing industry. Outlets like the Associated Press, Axel Springer, and Vox Media have inked lucrative licensing deals with OpenAI. However, regional newsrooms are increasingly turning to litigation to establish legal boundaries.
Responding to the filing, an OpenAI spokesperson stated that its models rely on publicly available data grounded in legal fair use principles. A Microsoft spokesperson expressed surprise at the lawsuit, noting that the company values local journalism and would be willing to sit down and find amicable solutions to content disputes.
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