Generative AI and Copyright: Copyright Infringement

Do you think courts will continue to apply traditional fair use factors as-is, or will they adapt the fair use doctrine to account for AI’s unique characteristics? Although AI itself cannot infringe, can a user who "creates" a work through a series of prompts infringe (perhaps unknowingly) if the AI-generated content itself incorporates infringing material?

Great questions. Courts cannot change the statutory factors in the fair use test, but they can of course change how they apply them. Although the Supreme Court's recent decision in Andy Warhol Foundation v. Goldsmith clarified how to apply the first fair use factor (purpose and character of the use), by stressing the commercial aspects and explaining that the meaning or message alone does not make a use transformative, since then, we have seen a court in the Northern District of California (Kadrey) find that AI training on copyrighted materials was a fair use because the technology is new and thus highly transformative, and a second court (Bartz) find more or less the same ("quintessentially transformative" with little explanation), as far as books that were pirated (but not for books that were purchased properly, scanned, and trained on). But depending on the AI system, you are right, certain parts of the fair use test may be harder to apply. For example, for the "amount and substantiality of the potion used" factor, a diffusion model is not necessarily "remembering" what it was trained on, but rather the steps it took to noise and denoise an image. We are now seeing Midjourney's attorneys make that very argument in one of the infringement suits against Midjourney. With respect to the second question, AI can itself infringe: developers of the generative AI model or system could be liable for direct infringement or contributory or vicarious infringement, based on how the system is trained, configured, and then deployed & used by users. Similarly, someone who generated an output using the AI system could also be liable for infringement, even if they did not know about the underlying works that were used to train or create the infringing output; this is why many generative AI systems have in their terms of service or terms of use an indemnity provision for IP infringement, though there are carve outs to that that users should also be aware of. In practice, it may make more sense for the plaintiff to go after the AI system/model developer rather than the user (or go after both).