The ruling, issued on Wednesday 11/11, marks the first major European court ruling to hold an AI company itself liable for the unauthorized use of protected works. It states that fair use of creative content does not exempt AI developers from licensing obligations.
Presiding judge Elke Schwager ordered OpenAI to pay GEMA undisclosed damages for the use of the protected material.
Copyright infringement
OpenAI had argued that its language models did not store or copy specific training data, but rather reflected what they had learned based on the entire training data set.
Since the output would only be generated as a result of user’s input, known as prompts, it was not the defendants but the respective user who would be responsible for that result, OpenAI had argued.
However, the court ruled that both the memorization in the language models and the reproduction of song lyrics in the chatbot’s output constituted copyright infringements.
Legal precedent
The outcome of the case could set a precedent in Europe for how AI companies use copyrighted material.
"The internet is not a self-service store, and human creative achievements are not free templates," said GEMA CEO Tobias Holzmueller. "Today, we have set a precedent that protects and clarifies the rights of authors: even operators of AI tools such as ChatGPT must comply with copyright law."
GEMA legal advisor Kai Welp said GEMA hoped that OpenAI could now start negotiations on how copyright holders can be compensated.
For the broader AI sector, the ruling suggests that AI companies operating in the European Union may need explicit licenses for any copyrighted content used in training machine learning models.
The ruling also has regulatory implications. It aligns with the growing momentum within the EU to enforce transparency and protection of rights holders under the EU AI Act and the CDSM Directive.
GEMA, which manages the rights of composers, songwriters and music publishers with 100,000 members, had filed a lawsuit against OpenAI in November 2024.
OpenAI has the right to appeal against the ruling.
Sources: CISAC, Reuters, The Guardian