This is the biggest US copyright infringement settlement ever, per the Authors Guild
US-headquartered artificial intelligence startup Anthropic is set to pay out US$1.5 billion to authors in what the Authors Guild described as the biggest US copyright infringement settlement ever.
The plaintiffs in Bartz et al. v. Anthropic PBC, No. 3:24-cv-05417-WHA (N.D. Cal.) announced the settlement, which is pending court approval, on Friday. Per the terms of the settlement, Anthropic will deposit the payout along with interest in cash into a settlement fund.
The US$1.5 billion will be divided among the rightsholders of all books in the class action once administration and lawyers’ fees and costs have been deducted, according to the Authors Guild. About US$3,000 will be allocated for each title in line with the settlement agreement, which concluded that at present, approximately 500,000 titles were eligible for inclusion in the suit.
The settlement does not license or permit Anthropic to use the works in question for future AI training; it also does not cover claims arising after August 25.
“This landmark settlement far surpasses any other known copyright recovery. It is the first of its kind in the AI era. It will provide meaningful compensation for each class work and sets a precedent requiring AI companies to pay copyright owners,” said Susman Godfrey LLP’s Justin Nelson, who acted as co-lead plaintiffs’ counsel, in a media release.
Authors Andrea Bartz, Kirk Wallace Johnson, and Charles Graeber first sued Anthropic in August 2024, claiming that the company infringed their copyrights by using pirated copies of their works to train its large language model Claude. Anthropic had obtained the works from piracy sites Library Genesis (LibGen), Pirate Library Mirror (PiLiMi), and Books3; the company then stored the copies in a central library.
Under the settlement agreement, Anthropic must destroy all the original files it downloaded from LibGen and PiLiMi, as well as any copies generated from these files.
“It is truly shocking that Anthropic and the other major LLM owners engaged in criminal-level piracy schemes to torrent millions of books knowingly from infamous foreign ebook piracy sites that the publishing industry has actively been trying to take down for years,” said Mary Rasenberger, Authors Guild CEO, in a statement. “Imagine the outrage if Anthropic and others had illegally siphoned off electricity to build their AI, claiming it was too expensive to pay for it? These vastly rich companies, worth billions, stole from those earning a median income of barely $20,000 a year. This settlement sends a clear message that AI companies must pay for the books they use just as they pay for the other essential components of their LLMs.”
The guild expected the settlement to result in additional licensing that grants authors “compensation and control over the use of their work by AI companies, as should be the case in a functioning free market society,” Rasenberger added.
The Authors Guild was not a party in the class action but was among the stakeholders consulted in the process of negotiating the settlement. A hearing on the Unopposed Motion for Preliminary Approval of Settlement has been scheduled for Monday September 8, to be held in San Francisco district court. A final approval hearing may be set for next year.
“I believe that settlement as presented is beneficial to all class members and I am hopeful that the settlement will receive wide support from copyright owners. Beyond the monetary terms, the proposed settlement provides enormous value in sending the message that Artificial Intelligence companies cannot unlawfully acquire content from shadow libraries or other pirate sources as the building blocks for their models,” said Maria Pallante, Association of American Publishers president and CEO, in a media release.
Lieff Cabraser Heimann & Bernstein, LLP’s Rachel Geman served as court-appointed co-lead class counsel alongside Nelson.
