Microsoft is seeking to dismiss parts of The New York Times lawsuit

Microsoft filed a motion in federal court on Monday to dismiss parts of a lawsuit filed by The New York Times Company.

The times indicted Microsoft and its partner OpenAI accused the two companies on December 27 of infringing their copyrights by using their articles to train AI technologies such as the online chatbot ChatGPT. Chatbots compete with the news media as a source of reliable information, the lawsuit said.

In his movementfiled in the U.S. District Court for the Southern District of New York, Microsoft argued that large language models, or LLMs — the technologies that power chatbots — have not displaced the market for news articles and other materials for which they are trained.

The tech giant compared LLMs to videocassette recorders and argued that both are allowed under the law. “Despite The Times’ claims, copyright law is no more of an obstacle to the LLM than it is to the VCR (or the pianola, the copier, the personal computer, the Internet or the search engine),” the motion said.

In the late 1970s, movie studios sued Sony over its Betamax VCR, arguing that it would allow people to illegally copy movies and television shows. But the court ultimately ruled that making these copies for personal use was fair use under the law.

Microsoft’s motion was similar to OpenAI’s last week. Microsoft said three parts of the lawsuit should be dismissed in part because The Times failed to show actual damages.

For example, The Times had argued that if readers use Microsoft’s chatbot to make recommendations from the review site Wirecutter, which The Times owns, they would lose revenue from users who would have clicked on the referral links. Microsoft argued that the Times lawsuit “provided no real-world facts indicating meaningful revenue diversion from Wirecutter.”

Microsoft and The New York Times Company had no immediate comment.

The Times was the first major American media company to sue Microsoft and OpenAI over copyright issues related to its written works. Writers, computer coders and other groups have also filed copyright lawsuits against companies building generative AI, technologies that generate text, images and other media.

Like other AI companies, Microsoft and OpenAI built their technology by providing these massive amounts of digital data, some of which is likely copyrighted. AI companies have claimed that they can legally use such material to train their systems without paying for it because it is public and they are not reproducing the material in its entirety.

In its lawsuit, The Times included examples of how its OpenAI technology reproduces excerpts from its articles almost word for word. Microsoft said training the technology for such articles was “fair use” under the law because chatbots were a “transformative” technology that created something new with copyrighted material. However, it has not sought to dismiss the arguments against ‘fair use’, but says it will address these issues at a later date.