Anthropic admitted in a U.S court that it will dish out $1.5 billion to resolve a class action lawsuit filed by authors.

In a significant development, Anthropic, a tech company backed by Amazon and Alphabet, has agreed to pay a staggering $1.5 billion to settle a class-action lawsuit from a group of authors. The lawsuit, filed last year by authors Andrea Bartz, Charles Graeber, and Kirk Wallace Johnson, alleges that Anthropic unlawfully used millions of pirated books to teach its AI assistant Claude.

The settlement marks the first in a series of lawsuits against tech companies such as OpenAI, Microsoft, and Meta Platforms. The case has been a pivotal one in the ongoing debate over the use of copyrighted material to train generative AI systems.

In June, a San Francisco judge, Alsup, ruled that Anthropic made fair use of the authors' work to train Claude, but found that the company violated their rights by saving more than 7 million pirated books. The companies argue their systems make fair use of copyrighted material to create new, transformative content. However, in a similar ongoing lawsuit against Meta, another San Francisco judge ruled that using copyrighted work without permission to train AI would be unlawful in "many circumstances."

The potential damages in the trial range into the hundreds of billions of dollars. The settlement was announced in August without disclosing the terms or amount, and Anthropic and the plaintiffs have asked a San Francisco federal judge to approve the settlement.

The lawsuit is part of a string of lawsuits against tech companies over the use of copyrighted material to train generative AI systems. Dozens of other lawsuits have been brought by authors, news outlets, visual artists, and others who allege that tech companies stole their work for AI training.

The pivotal fair-use question is still being debated in other AI copyright cases. In the Anthropic lawsuit, the judge's ruling on fair use was a crucial factor in the settlement. The proposed deal is the largest publicly reported copyright recovery in history.

Justin Nelson, the prosecutor who filed the lawsuit against Anthropic in 2022 for unauthorized use of millions of pirated books to train the AI chatbot Claude, has been instrumental in the case. A trial for determining how much Anthropic owes for alleged piracy was scheduled to begin in December.

The settlement comes at a time when the use of AI in various industries is on the rise, and the question of copyright infringement in AI training remains a contentious issue. The resolution of this lawsuit may set a precedent for future cases involving AI and copyright law.

Anthropic admitted in a U.S court that it will dish out $1.5 billion to resolve a class action lawsuit filed by authors.