Seattle Times and Newsday Sue OpenAI and Microsoft Over Copyright

The Seattle Times and Newsday filed a federal lawsuit in Manhattan on Friday, alleging that OpenAI and Microsoft infringed on their copyrights by ingesting proprietary journalism to train generative AI models [1]. The legal action marks a significant escalation in the media industry’s push to secure compensation for content used to power AI products that publishers claim compete directly with their own subscription-based business models [1].

The core of the complaint

The 38-page complaint characterizes the training process as "a snake eating its own tail," arguing that by reproducing journalism—often verbatim—without permission or payment, the tech companies are actively undermining the financial viability of independent newsrooms [1]. Beyond the unauthorized use of content, the publishers allege that the defendants’ scraping methods specifically circumvented digital paywalls and access restrictions [2]. The lawsuit also claims that the AI models have generated hallucinations that falsely attribute information to the two news organizations and that the defendants stripped copyright management information from the ingested articles [2].

The plaintiffs are seeking an unspecified amount of damages and have requested court orders for the "impoundment and/or destruction" of data sets and AI models that contain their copyrighted material [1]. While Microsoft spokesperson Drew Born stated the company was "surprised" by the litigation, he noted that the firm remains open to exploring solutions to the dispute [1]. OpenAI did not respond to requests for comment [1].

The shifting media landscape

This filing joins a broader wave of litigation against AI developers, including high-profile cases from The New York Times and a coalition of roughly 400 local newspapers [2]. The industry remains divided on how to address the rise of AI-driven content aggregation: while some publishers have chosen to litigate, others—such as The Washington Post and News Corp.—have opted to sign licensing deals with OpenAI [1].

The stakes for the defendants are substantial. OpenAI, currently valued at roughly $850 billion, is reportedly preparing to go public within the next year or sooner as it pursues a $1 trillion valuation [1]. For publishers, the core concern is that AI chatbots allow users to access information without visiting news websites or clicking links, effectively cannibalizing the digital advertising and subscription revenue that sustains professional journalism [1].

What to watch

• Court Rulings on Data Destruction: Monitor whether the court entertains the plaintiffs' request to destroy existing AI data sets, a move that would set a significant precedent for the entire generative AI sector.
• Expansion of Licensing Deals: Watch for whether additional major publishers follow the path of News Corp. and The Washington Post by signing licensing agreements, or if the current litigation trend forces a shift in OpenAI’s negotiation strategy.
• Regulatory Compliance: Observe if the defendants cite the EU’s general-purpose AI code of practice—which specifically addresses the circumvention of paywalls—as a framework for their defense or future policy updates [2].

The outcome of this case will likely determine whether news organizations can successfully force a shift toward a paid licensing model for AI training data or if the current "wholesale taking" of content will remain the industry standard. With the defendants seeking a massive valuation increase in the near term, the pressure to resolve these copyright disputes without disrupting their underlying technology models is mounting [1].