Key takeaways
- Sony Music Publishing and Warner Chappell accuse Anthropic of obtaining copyrighted songs through torrenting, scraping and unauthorized downloads.
- The publishers are seeking up to $150,000 for each infringed composition and an order preventing Anthropic from using their works.
- The case could help determine whether AI developers must license copyrighted material before using it to train commercial models.
Sony Group Corporation’s (NYSE:SONY) music-publishing division and Warner Music Group Corporation’s (NASDAQ:WMG) Warner Chappell have sued Anthropic, alleging the artificial-intelligence company unlawfully copied tens of thousands of songs to develop its Claude models.
The lawsuit, filed in the U.S. District Court for the Northern District of California, also names Anthropic chief executive Dario Amodei and co-founder Benjamin Mann as defendants.
The publishers claim Anthropic built a valuable commercial product using copyrighted material without obtaining permission or paying licensing fees.
Publishers allege widespread piracy
According to the complaint, Anthropic allegedly acquired lyrics and sheet music through BitTorrent downloads, pirate libraries and large internet datasets.
The company is also accused of scraping authorized lyric services, including Musixmatch and LyricFind, and removing information identifying the works and their copyright owners.
Songs cited in the filing include Mariah Carey’s “All I Want for Christmas Is You,” Survivor’s “Eye of the Tiger,” Leonard Cohen’s “Hallelujah,” Bon Jovi’s “Livin’ on a Prayer” and Taylor Swift’s “Paper Rings.”
The publishers allege that Claude can reproduce some protected lyrics verbatim or nearly verbatim. They also argue that training Claude on their catalogues enables the chatbot to generate new lyrics that compete with human-written compositions.
Anthropic disputes the allegations. A spokesperson described the filing as the third lawsuit from the same lawyers containing claims already before the courts and said the company would defend itself “robustly.”
Fair use may not resolve the dispute
Anthropic maintains that training AI models on copyrighted material qualifies as fair use.
A federal judge previously agreed that using legally acquired books to train Anthropic’s language models could constitute fair use because the process was sufficiently transformative.
However, the same ruling found that creating a permanent library from millions of pirated books was not protected merely because those books might later be used for lawful AI training.
Anthropic subsequently agreed to pay $1.5 billion to settle claims brought by authors whose books allegedly appeared in the pirated collection. It did not admit liability.
That distinction is likely to become central to the music publishers’ case. Courts may treat the act of training an AI model differently from illegally obtaining the material used for that training.
Potential damages could reach billions
Sony and Warner are seeking statutory damages of up to $150,000 for each composition found to have been willfully infringed.
They also seek as much as $25,000 for each alleged removal or alteration of copyright-management information, along with an injunction preventing Anthropic from continuing to use the protected works.
Those maximum awards are not automatic. The publishers must establish infringement, prove ownership of the relevant copyrights and overcome Anthropic’s fair-use arguments.
However, applying even part of the maximum penalty across thousands of works could produce a multibillion-dollar judgment or create pressure for another substantial settlement.
Why investors should care
The case could strengthen music publishers’ ability to charge AI companies for access to song catalogues.
A ruling requiring licences would create a new revenue opportunity for Sony Music Publishing, Warner Chappell and other rights holders. It could also improve the value of existing catalogues by establishing that AI training represents a separately licensable use.
For AI developers, the opposite applies. Mandatory licensing and possible damages would increase model-development costs while creating uncertainty around training datasets assembled years earlier.
Anthropic remains privately held, so investors cannot directly trade its shares. Its most prominent financial backers include Amazon.com Inc. (NASDAQ:AMZN) and Alphabet Inc. (NASDAQ:GOOGL).
Shares of the two listed music companies were mixed Monday. Sony’s U.S.-listed shares fell approximately 1 per cent, while Warner Music gained around 0.8 per cent, showing no unified market reaction to the lawsuit.
The legal battle is unlikely to produce a quick answer. Its importance lies in whether the courts distinguish between transformative AI training and the allegedly unlawful acquisition of the material that makes that training possible.