OpenAI's Copyright Situation Appears to Be Putting It in Huge Danger

"AI's appetite for raw data has been a huge legal sticking point, to put it mildly."

"Courts might accept copying for transformative learning, but they may be less forgiving when AI models generate recognizable... images where infringement risk is likely higher."

"SpongeBob, a character who's featured heavy in AI-generated meth lab scenes lately, has generated $16 billion in retail sales since his franchise's launch 26 years ago."

AI systems require massive quantities of data drawn from books, films, music, and social media. That demand for raw training material has created persistent legal conflicts over copyright. The industry has relied on claims of transformative learning and fair use to justify using copyrighted works for model training. The generation of highly recognizable images and videos, especially of valuable franchise characters, raises new infringement concerns that courts may view less favorably. Judges tend to treat visual content as more expressive and more protectable than text. Strong commercial value behind characters increases the likelihood of legal scrutiny and enforcement.

Read at Futurism