Copyright Infringement Liability for Generative AI Training Following the Copyright Office’s AI Report and Administrative Shakeup

When multiple forces act on an object, its direction of motion is determined by the net force, which is the vector sum of all individual forces.

When this happens within our federal government, we call it “interesting times.”

Not unlike other areas of the United States federal government of late, the U.S. Copyright Office has been thrown into turmoil following a stunning sequence of events this past week.  As reported in multiple news outlets:

• On Thursday, May 8, 2025, President Donald Trump fired Librarian of Congress Carla Hayden, the first woman and the first African American to be librarian of Congress.^[i] The Library of Congress is the larger federal agency within which the U.S. Copyright Office resides.
• On Friday, May 9, 2025, the U.S. Copyright Office released a “Pre-Publication Version” of the third and final part of its three-part Report on Artificial Intelligence.^[ii] This Part 3 of the Report is entitled “Generative AI Training” and makes the case for finding copyright infringement where copyrighted works are used without permission to train generative AI models (more on this below).^[iii] The Report was posted to the Copyright and AI landing page of the Copyright Office’s website a day after the firing of the Librarian of Congress and roughly 5 months after the official Publication of Part 2, which is about a month shorter than the interval between Parts 1 and 2 of the Report.^[iv] 
• On Saturday afternoon, May 10, 2025, the Registrar of Copyrights, Shira Perlmutter, received an email from the White House informing her that her job as Register of Copyrights and Director at the U.S. Copyright Office had been “terminated effective immediately.”^[v]
• These recent events follow earlier criticism by prominent leaders of technology companies regarding perceived constraints posed by U.S. intellectual property laws on the development of artificial intelligence products and services. For example, on April 13, 2025, Jack Dorsey, co-founder of the companies formally known as Twitter and Square, posted: “delete all IP law,” to which Elon Musk replied, “I agree.”^[vi]  More broadly, as lobbying in favor of regulatory relief has increased with the change of administration,^[vii] the mood in Washington appears to have shifted from caution to pro-development of the AI industry, as shown by the current President’s repeal^[viii] of his predecessor’s sweeping executive order and the more recent attempt by Congressional Republicans to insert into the tax and spending bill a moratorium on state AI legislation.^[ix]

Given all of this, interested parties may be left to wonder whether and to what extent they should rely upon the guidance and analysis of the Copyright Office’s AI Report. The question is particularly acute for parties involved in active litigation concerning the question of copyright infringement for generative AI training. 

What’s next?

Let’s deal with what we know and leave the political speculation to other sources.

First, IP law is not going away anytime soon.  Patent and copyright law are enshrined in the U.S. Constitution.^[x] And nobody is calling for the end of all trademarks.  We all have a brand, after all, and the ability to control one’s reputation by excluding others from unauthorized use is essential to all businesses.  Bold statements aside, the law will continue to evolve but the need to support innovation though intellectual property rights retains broad recognition by serious people.

Second, Jack Boyle’s words, spoken in another context, seem to best capture the dynamic environment in Washington these days: “nobody knows ‘nothin.”[xi]  Speculation on motive and the future direction of any particular legal issue or policy, including those involving AI, is a risky bet. While a pattern has emerged showing a preference by the administration for prioritizing pro-growth of the AI sector through relaxed legal barriers, ultimately these issues will play out in federal courts where  considerations of legal precedent and constitutionality may impose restraints on executive and certain legislative actions.

Third, the U.S. Copyright Office’s AI Report does not carry the force of law.  It does signal the Office’s approach to important legal issues within its purview, which approach could theoretically change with the change in leadership.  And, more relevantly to the subject matter of this most recent portion of the Report, it can also serve as a roadmap for litigants, persuasive authority for courts, and input to the legislative process.

Fourth, agree with it or not, the Report as written is now in the public domain.  Whether or not its authors continue to draw a paycheck from the federal government, and whether their successors write a new chapter or revision, the analysis speaks for itself and has been widely disseminated. A party who ignores this in-depth and well sourced treatment does so at its own peril. 

So, what does the Report say?

Prima Facie Case for Infringement. The Report begins by finding that a prima facie claim for copyright infringement is easily met.  In the Office’s view, multiple steps required to produce a dataset useful for generative AI “clearly implicate” the copyright owners’ right to control the reproduction of their works. These steps include the collection and curation of the copyrighted works, their use in training, and deployment of the model.^[xii]   Less clear, in the Office’s view, is whether or not the output material of the resulting generative AI model (which may, in some cases, look very much like and even compete with the original work) may implicate the copyright owners’ rights to control public display and performance of their works.^[xiii]

Fair Use Defense. The Report proceeds with an analysis of the “fair use” defense to copyright infringement, including each of the statutory fair use factors set forth in 17 U.S.C. § 107, which are:

1. the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes;
2. the nature of the copyrighted work;
3. the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and
4. the effect of the use upon the potential market for or value of the copyrighted work.

After an in-depth consideration of each of the factors,^[xiv] as informed by existing legal precedent and the comments received through the Notice of Inquiry (NOI) process that gave rise to the Report, the Copyright Office offers the following somewhat equivocal perspective:

As generative AI involves a spectrum of uses and impacts, it is not possible to prejudge litigation outcomes. The Office expects that some uses of copyrighted works for generative AI training will qualify as fair use, and some will not. On one end of the spectrum, uses for purposes of noncommercial research or analysis that do not enable portions of the works to be reproduced in the outputs are likely to be fair. On the other end, the copying of expressive works from pirate sources in order to generate unrestricted content that competes in the marketplace, when licensing is reasonably available, is unlikely to qualify as fair use. Many uses, however, will fall somewhere in between.^[xv]

Recommendation for Licensing. Licensing, the Copyright Office suggests, is a workable solution for both resolving the ambiguity of legal rights and fairly balancing the interests of content creators and AI developers.^[xvi] Options suggested in the Report may include the forms of streamlined voluntary approaches already in the market as well as adapted statutory approaches such as compulsory licensing and extended collective licensing (“ECL”).

Final Analysis. Governmental turmoil aside, the Copyright Office’s AI Report, now completed with the delivery of its third installment, provides a solid starting point for litigants, courts, legislators, and businesses to understand the competing viewpoints and legal arguments related to artificial intelligence.  This guidance will likely show up in legal briefs in the near future and it may also  motivate efforts to address these issues legislatively.

ENDNOTES

[i] “Trump administration fires top copyright official days after firing Librarian of Congress,” Associated Press, May 11, 2025 (last visited May 11, 2025).

[ii] See Copyright Office statement on May 9, 2025 accompanying the posting of Part 3 of its Report on Artificial Intelligence (last visited May 11, 2025).

[iii] U.S. Copyright Office Report on Artificial Intelligence, Part 3: Generative AI Training, Pre-Publication Version, May 2025 (herein, “Copyright Report, Part 3”) (last visited May 11, 2025).

[iv] For an analysis of Parts 1 and 2 of the Copyright Office Report on Artificial Intelligence, see “Charting a Course on AI Policy: the U.S. Copyright Office Speaks!,” Krabacher, April 2, 2025.

[v] “Trump fires top US copyright official,” Politico, May 10, 2025 (based on POLITICO receipt of internal Library of Congress communications (last visited May 11, 2025); “Trump administration fires top copyright official days after firing Librarian of Congress,” Associated Press, May 11, 2025 (last visited May 11, 2025).

[vi] “Jack Dorsey and Elon Musk would like to ‘delete all IP law’,” April 13, 2025, Techcrunch (last visited May 11, 2025).

[vii] See, e.g., “Emboldened by Trump, AI Companies Lobby for Fewer Rules,” New York Times, March 24, 2025 (last visited May 13, 2025).

[viii] Executive Order: Removing Barriers to American Leadership In Artificial Intelligence, January 23, 2025 (last visited May 13, 2025).

[ix] State AI Regulation Ban Tucked Into Republican Tax, Fiscal Bill, Bloomberg, May 12, 2025 (last visited May 13, 2025).

[x] U.S. Const. Article I, Section 8,  Clause 8 of the U.S. Constitution (the “Patent and Copyright Clause”).

[xi] See. e.g., John Boyle interview posted on Sensible Investing YouTube, September 26, 2012: “All You Need To Know About Investing In Three Words,” (last visited May 16, 2025).

[xii] Copyright Report, Part 3, pg. 26 – 31.

[xiii] Copyright Report, Part 3, pg. 31.

[xiv] Copyright Report, Part 3, pg. 32 - 74.

[xv] Copyright Report, Part 3, pg. 74.

[xvi] See U.S. Copyright Office Report at page 103.