Anthropic Pays Record $1.5 Billion to Settle Author Copyright Lawsuit

Anthropic, the AI company behind the Claude chatbot, is making headlines for agreeing to a monumental $1.5 billion settlement. This record-breaking payout will resolve a class-action piracy lawsuit brought by half a million authors, marking the largest-ever sum for a copyright case in the United States.

While the settlement terms were initially kept under wraps, The New York Times has now revealed the staggering details: the 500,000 authors involved in the case will receive $3,000 for each copyrighted work.

Justin A. Nelson, the lawyer representing the authors, hailed the agreement as “the first of its kind in the AI era.” He emphasized that this “landmark settlement” far surpasses any previous copyright recovery, providing significant compensation and setting a crucial precedent that demands AI companies compensate copyright owners. Nelson’s statement clearly sends a powerful message: “taking copyrighted works from these pirate websites is wrong.”

This closely watched case highlights the growing legal challenges faced by top AI companies over their use of copyrighted materials. Interestingly, a judge had previously ruled in June that Anthropic’s use of copyrighted content for training its large language model fell under “fair use”—a significant win for the company at the time. However, the authors and publishers were still permitted to pursue piracy claims because the books in question were illegally downloaded from sites like Library Genesis (also known as “LibGen”).

As part of the settlement, Anthropic has committed to deleting all illegally downloaded content. The company also stated that it did not use any pirated works to build its publicly released AI technologies, though it has not admitted to any wrongdoing.

Aparna Sridhar, Anthropic’s Deputy General Counsel, reiterated the company’s position. She referenced the June ruling on fair use and stated that “Today’s settlement, if approved, will resolve the plaintiffs’ remaining legacy claims.” Sridhar affirmed Anthropic’s dedication to developing safe AI systems that empower people and organizations.

This historic settlement serves as a major turning point, potentially shaping how AI companies approach intellectual property rights and compensation for creators moving forward.