The current wave of startup lawsuits is dominated by AI copyright fights, with a record $1.5 billion settlement against Anthropic, consolidated federal litigation against OpenAI, studio suits against Midjourney, publisher claims against Perplexity, and a steady background of patent troll filings aimed at early-stage companies. Here is what is on the docket and what each case is actually deciding.
Anthropic’s $1.5 Billion Copyright Settlement
The largest copyright settlement in U.S. history came out of Bartz v. Anthropic, filed in the Northern District of California. Authors Andrea Bartz, Charles Graeber, and Kirk Wallace Johnson alleged that Anthropic trained Claude on hundreds of thousands of books pulled from pirate repositories Library Genesis and Pirate Library Mirror.1Lieff Cabraser Heimann & Bernstein LLP. Authors Secure $1.5 Billion Settlement in Landmark AI Piracy Case
In June 2025, Judge William Alsup split the question in a ruling that has shaped every AI copyright case since. Training on lawfully acquired books was “quintessentially transformative” and protected by fair use. Downloading and keeping pirated copies was not.2Authors Alliance. What Authors Need to Know About the Anthropic Settlement The court certified a class covering 482,460 books in August, and the $1.5 billion deal followed in September.
Anthropic agreed to pay roughly $3,000 per work in four installments running through September 2027, to destroy all pirated files and derivatives, and to accept that the settlement covers only past conduct through August 25, 2025. No future training license comes with it.3Authors Guild. What Authors Need to Know About the Anthropic Settlement At the fairness hearing on May 14, 2026, lead counsel reported a 92.77% claims rate and only 53 objections. Final approval is widely expected.4Publishing Perspectives. Anthropic Settlement Appears to Cruise Through Its Final Fairness Hearing
Disney, Universal, and Warner Bros. v. Midjourney
In June 2025, Disney and Universal jointly sued Midjourney in federal court in Los Angeles. The 110-page complaint, brought by entities including Marvel Characters, Lucasfilm, Twentieth Century Fox, and DreamWorks Animation, accused the AI image-generation startup of training on “countless” copyrighted works and generating unauthorized images of characters including Shrek, Darth Vader, Homer Simpson, and Spider-Man.5NPR. AI Disney Universal Midjourney Copyright Infringement Lawsuit
Warner Bros. filed a parallel complaint in September 2025. The two actions were consolidated in November under Judge John A. Kronstadt, with Disney as the lead case.6Copyright Alliance. AI Copyright Lawsuit Developments Midjourney filed an answer with a jury demand in August 2025 and has not moved to dismiss. The court sent the consolidated case to private mediation, ordered to occur no later than August 19, 2026.7CourtListener. Disney Enterprises Inc. v. Midjourney Inc.
The studios also sued China-based Minimax over its “Hailuo AI” video model in September 2025. After months of service problems, the court deemed service effective in February 2026, and Minimax filed motions to dismiss in April 2026, arguing the Chinese parent has no U.S. contacts and that any alleged copying happened in China.8McKool Smith. AI Litigation Update — Disney v. MiniMax
The Consolidated OpenAI MDL
Copyright claims from The New York Times, The Center for Investigative Reporting, and others against OpenAI and Microsoft are consolidated before Judge Sidney H. Stein in the Southern District of New York as In Re: OpenAI, Inc. Copyright Infringement Litigation (No. 25-MD-3143).9CourtListener. In Re: OpenAI, Inc. Copyright Infringement Litigation
The case has already produced a sharp discovery fight. In May 2025, Magistrate Judge Ona T. Wang ordered OpenAI to preserve and segregate all ChatGPT output logs that would otherwise be deleted, covering free, paid, and Plus-tier users. OpenAI moved for reconsideration on proportionality and privacy grounds; Judge Wang denied it. The court then ordered production of massive subsets covering tens of millions of records.10Midpage. In Re: OpenAI, Inc., Copyright Infringement Litigation As of June 2026, the case remains in active discovery.
Perplexity AI: Publisher Suits and a Dropped Privacy Class Action
The New York Times sued Perplexity on December 5, 2025, in the Southern District of New York, alleging the AI search startup repeatedly scraped Times articles to generate user answers and that those answers directly competed with the paper’s own content. The Times said it had asked Perplexity to stop over an 18-month period.11The New York Times. New York Times Perplexity AI Lawsuit Dow Jones sued in 2024, the Chicago Tribune filed one day before the Times, and Encyclopedia Britannica and Merriam-Webster filed in September 2025.6Copyright Alliance. AI Copyright Lawsuit Developments The Times case is in its early stages, with a February 2026 response deadline.12CourtListener. The New York Times Company v. Perplexity AI, Inc.
A separate privacy class action had a much shorter life. A Utah plaintiff filed in San Francisco on March 31, 2026, alleging Perplexity shared complete chat transcripts with Meta and Google through embedded trackers, including when users had activated “Incognito Mode.” The complaint said the shared data included queries about health, finances, and legal matters.13Ars Technica. Perplexity’s Incognito Mode Is a Sham, Lawsuit Says After Judge Vince Chhabria denied anonymous status on April 3, 2026, the plaintiff was identified as David Noel. He voluntarily dismissed without prejudice on May 1, 2026, and the case was terminated May 6. A refile remains possible.14PACER Monitor. Noel v. Perplexity AI, Inc. et al
Meta’s Seeding Claims Survive Summary Judgment
Meta won on the headline copyright question in June 2025 when the court granted summary judgment in Kadrey v. Meta Platforms, finding LLaMA training “highly transformative.” Claims that Meta also uploaded (or “seeded”) copyrighted books to other BitTorrent users while downloading them survived.6Copyright Alliance. AI Copyright Lawsuit Developments
In March 2026, Judge Chhabria let plaintiffs file a Fifth Amended Complaint adding a contributory infringement claim built on the seeding theory, along with new named plaintiffs and a revised class definition. The court denied class discovery for now, holding that it would open only if the named plaintiffs survive summary judgment on both the distribution and contributory infringement claims. Meta has signaled another fair use defense.15Ars Technica (court order). Kadrey v. Meta Order Granting Motion for Leave
Getty Images v. Stability AI: A Narrow UK Win
Getty Images’ UK suit against Stability AI reached judgment in November 2025 with a mixed outcome. Getty abandoned its primary copyright and database-rights claims before closing arguments, conceding it had no evidence that Stable Diffusion training occurred in the UK. The High Court then dismissed Getty’s secondary copyright claim, ruling that AI model weights do not contain stored copies of copyrighted works.16High Court of England and Wales. Getty Images v. Stability AI, EWHC 2863 (Ch)
Getty did win on a narrower trademark point tied to watermarks appearing in outputs from older Stable Diffusion versions, though the court found no continuing issue past version 2.x. Getty said it will use the factual findings in its U.S. case against Stability.17Getty Images Newsroom. Getty Images Issues Statement on Ruling in Stability AI UK Litigation
Music Labels Settle With Udio and Suno
Two AI music startups chose licensing over litigation in late 2025. Universal Music Group and Warner Music Group settled with Udio in October and November 2025, with the deals powering a subscription service launching in 2026 that lets artists opt in. Warner also settled with Suno in November, with Suno committing to a licensed model in 2026 and phasing out current versions.6Copyright Alliance. AI Copyright Lawsuit Developments
ByteDance and the YouTube Scraping Theory
In December 2025, Ted Entertainment, filmmaker Matt Fisher, and Golfholics Inc. filed a class action against ByteDance in the Northern District of California. The complaint alleges ByteDance circumvented YouTube’s technical protections to scrape millions of videos used to train its “MagicVideo” model, invoking the DMCA’s anticircumvention provisions in Section 1201 and describing automated downloading combined with rotating IP addresses.18Ted Entertainment Class Action Complaint. Ted Entertainment Inc. et al. v. ByteDance — Complaint An amended complaint was filed in April 2026, and the case is active before Judge Jacqueline Scott Corley.19CourtListener. Ted Entertainment, Inc. v. ByteDance Inc.
Kove IO’s $673 Million Verdict Against Amazon on Appeal
A non-AI matter is also worth tracking. Kove IO, a data-storage startup, won a $525 million jury verdict against Amazon Web Services in April 2024 over three patents on network data distribution and location management. The trial court in the Northern District of Illinois later raised the judgment to $673 million.20Law360. Kove Wants Fed. Circ. to Back $673M IP Win Against Amazon Amazon’s Federal Circuit appeal argues the patents cover abstract ideas. At oral argument on May 8, 2026, the panel reportedly asked whether the inventions differed from a “library card catalog.” The decision is pending.21Law360. Kove IO, Inc. v. Amazon Web Services, Inc. — Case Articles
The Patent Troll Pressure on Startups
Below the headline fights, non-practicing entity suits against U.S. startups rose roughly 21–24% year over year between 2023 and 2025, with over 1,800 NPE suits filed in 2025. More than half targeted companies with under $10 million in annual revenue. A single assertion can cost an early-stage company $300,000 to $900,000 in legal fees and lost productivity, and startups sued by NPEs are 14–18% less likely to raise a follow-on round within a year.
Defensive responses have grown accordingly. Startups are joining patent pools like the LOT Network, buying litigation insurance, and building small strategic portfolios for deterrence. Companies with pre-arranged defense plans are reportedly 40–50% less likely to face existential disruption from a troll campaign. The America Invents Act’s post-grant review tools still matter, but Patent Trial and Appeal Board institution rates fell to 10.3% as of December 2025, which has encouraged more NPE filings.
Legislation could shift the balance. The RESTORE Patent Rights Act of 2025, reintroduced by Senators Chris Coons and Tom Cotton in February 2025, would create a presumption of permanent injunctions after a finding of infringement.22IPWatchdog. Coons, Cotton Reintroduce RESTORE Act for Injunctive Relief The EFF has flagged the Patent Eligibility Restoration Act and proposed USPTO rules limiting inter partes review as threats to startups’ ability to challenge weak patents.23Electronic Frontier Foundation. Resources for Patent Troll Victims
What the Rulings Mean for AI Startups
The 2025 and early 2026 decisions are drawing some workable lines. Training on copyrighted material can qualify as fair use when the output is transformative and does not substitute for the original. Bartz and Kadrey both characterized AI training as highly or “spectacularly” transformative.24Norton Rose Fulbright. An Update on AI Copyright Cases in 2026
How the data was obtained is a separate question, and it is the one that has produced the largest payouts. Pirated datasets drove the $1.5 billion Bartz settlement; lawfully sourced material received fair use protection. The spread of formal licensing deals, including Disney’s reported billion-dollar arrangement with OpenAI for Sora, may also make “no market harm” harder to argue in future cases.24Norton Rose Fulbright. An Update on AI Copyright Cases in 2026 And the Supreme Court’s March 2026 denial of certiorari in Thaler v. Perlmutter confirmed that AI-generated works without human authorship cannot be copyrighted, a constraint any generative-tool startup has to design around.25OSU Copyright Resources. Fair Use and Artificial Intelligence: 2026 Update