On the back of the proposed Anthropic copyright settlement
there is almost certainly a long line forming outside the Association of
American Publishers (AAP) headquarters to get a piece of the action. In the
form of a large copyright penalty discount that is.
Despite the strong objection of Judge William Alsup, who has
temporarily rejected the $1.5Billion settlement between Anthropic and a class
of authors, this settlement agreement will probably survive. The rejection may
appear to delay justice, but it also temporarily protects authors
from a deeply flawed agreement that will undermine their long-term interests.
While the payout is historic in scale, Judge Alsup rightly flagged concerns
about vague documentation, inadequate notice, and the risk of coercing authors
into a settlement they may neither fully understand nor meaningfully helped
shape. His unease, with the potential for attorneys and organizations to
pressure authors reflects a broader fear; that the settlement was more about
expediency than equity. When your
professional advocates, in this case, the AAP and Authors Guild (AG) immediately
endorse the settlement as a done deal that may not be coercive but it
definitely represents pressure.
The case itself is unusually clear-cut. Unlike most AI
copyright disputes, which hinge on the unsettled doctrine of fair use, this one
involved Anthropic’s admitted use of pirated books from notorious sources like
LibGen and PiLiMi. Judge Alsup’s ruling drew a sharp line—fair use may apply to
lawfully acquired books, but piracy is indefensible. With an estimated 500,000
infringing works, statutory damages could have reached tens of billions of
dollars. Yet the settlement proposed a flat $3,000 per work, a figure that
risks – perhaps is already - becoming a de facto benchmark for future cases. (By the way, fine print suggests the authors
won’t actually receive $3,000 per work).
For authors, this would mean accepting a valuation of their
work far below what the law allows, and far below what justice demands.
Admittedly, in the stark reality of publishing, $3,000 is far more than
most of those works are going to generate for their authors, but that is not
the point. Copyright law exists to both protect copyright holders (authors) and
heavily penalize those who breach copyright. That’s not happening here.
Anthropic’s financial strength further weakens the rationale
for settlement. With a valuation projected to reach $170 billion the absurd
notion that company is facing a “death knell” from litigation is undermined by
the very recent funding rounds topping $10 billion, which proves investors do
not consider any financial risks associated with this lawsuit. That should be
compelling evidence that this settlement is not even a slap on the wrist.
Approving the settlement will allow Anthropic to sanitize
its past misconduct without meaningful accountability, while leaving authors
with a diluted remedy. They should have
held out and gone to trial to preserve the only meaningful leverage the authors
can exert.
Ultimately, should Judge Alsup reject the settlement only
then would this preserve the possibility of a more principled resolution—one
that reflects the true value of authors’ work and the gravity of the
infringement. Remember, Anthropic (and others) acted knowingly and with
impunity to copy these works: With a degree of effort and market knowledge, they
sought out these pirate sites precisely because they could get the content for ‘free’.
Rejecting the settlement also avoids setting a precedent
that could weaken future copyright claims against AI developers. But while the
line outside AAP offices is figurative, I can bet Facebook attorneys are
ordering champagne all round this week.
Authors deserve more than a rushed compromise shaped by
corporate interests and vague processes. They deserve a legal framework that
protects their rights in the age of machine learning. Until courts provide
firmer guidance, the path forward should be cautious, deliberate, and above
all, fair. This settlement is not that.
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When the Google copyright case was in litigation, there was a lot of hyperventilation about the universe of 'orphan titles' which, in this highly referenced analysis, I suggested was overblown. We may find that the 500,000 works number cited in this agreement is over egged.
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Jimmy tried to force Howard to settle the Sandpiper litigation for all the wrong reasons. It led to Howard's unfortunate demise.
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