New York Times sues Microsoft, ChatGPT maker OpenAI over copyright infringement
The New York Times on Wednesday filed a lawsuit against Microsoft and OpenAI, creator of the popular AI chatbot ChatGPT, accusing the companies of copyright infringement and abusing the newspaper’s intellectual property to train large language models.
Microsoft both invests in and supplies OpenAI, providing it with access to the company’s Azure cloud computing technology.
The publisher said in a filing in the U.S. District Court for the Southern District of New York that it seeks to hold Microsoft and OpenAI to account for the “billions of dollars in statutory and actual damages” it believes it is owed for the “unlawful copying and use of The Times’s uniquely valuable works.”
The Times said in an emailed statement that it “recognizes the power and potential of GenAI for the public and for journalism,” but added that journalistic material should be used for commercial gain with permission from the original source.
“These tools were built with and continue to use independent journalism and content that is only available because we and our peers reported, edited, and fact-checked it at high cost and with considerable expertise,” the Times said.
The New York Times Building in New York City on February 1, 2022.
Angela Weiss | AFP | Getty Images
“Settled copyright law protects our journalism and content,” the Times added. “If Microsoft and OpenAI want to use our work for commercial purposes, the law requires that they first obtain our permission. They have not done so.”
“We respect the rights of content creators and owners and are committed to working with them to ensure they benefit from AI technology and new revenue models,” an OpenAI representative said in a statement. “Our ongoing conversations with the New York Times have been productive and moving forward constructively, so we are surprised and disappointed with this development. We’re hopeful that we will find a mutually beneficial way to work together, as we are doing with many other publishers.”
A representative for Microsoft didn’t respond to requests for comment.
The Times is represented in the proceedings by Susman Godfrey, the litigation firm that represented Dominion Voting Systems in its defamation suit against Fox News that culminated in a $787.5 million million settlement.
Susman Godfrey is also representing author Julian Sancton and other writers in a separate lawsuit against OpenAI and Microsoft that accuses the companies of using copyrighted materials without permission to train several versions of ChatGPT.
‘Mass copyright infringement’
The Times is one of numerous media organizations pursuing compensation from companies behind some of the most advanced artificial intelligence models, for the alleged usage of their content to train AI programs.
OpenAI is the creator of GPT, a large language model that can produce humanlike content in response to user prompts. It uses billions of parameters’ worth of information, which is obtained from public web data up until 2021.
Media publishers and content creators are finding their materials being used and reimagined by generative AI tools like ChatGPT, Dall-E, Midjourney and Stable Diffusion. In numerous cases, the content the programs produce can look similar to the source material.
OpenAI has tried to allay news publishers’ concerns. In December, the company announced a partnership with Axel Springer — the parent company of Business Insider, Politico, and European outlets Bild and Welt — which would license its content to OpenAI in return for a fee.
The financial terms of the deal weren’t disclosed.
In its lawsuit Wednesday, the Times accused Microsoft and OpenAI of creating a business model based on “mass copyright infringement,” stating that the companies’ AI systems were “used to create multiple reproductions of The Times’s intellectual property for the purpose of creating the GPT models that exploit and, in many cases, retain large portions of the copyrightable expression contained in those works.”
Publishers are concerned that, with the advent of generative AI chatbots, fewer people will click through to news sites, resulting in shrinking traffic and revenues.
The Times included numerous examples in the suit of instances where GPT-4 produced altered versions of material published by the newspaper.
In one example, the filing shows OpenAI’s software producing almost identical text to a Times article about predatory lending practices in New York City’s taxi industry.
But in OpenAI’s version, GPT-4 excludes a critical piece of context about the sum of money the city made selling taxi medallions and collecting taxes on private sales.
In its suit, the Times said Microsoft and OpenAI’s GPT models “directly compete with Times content.”
The AI models also limited the Times’ commercial opportunities by altering its content. For example, the publisher alleges GPT outputs remove links to products featured in its Wirecutter app, a product reviews platform, “thereby depriving The Times of the opportunity to receive referral revenue and appropriating that opportunity for Defendants.”
The Times also alleged Microsoft and OpenAI models produce content similar to that generated by the newspaper, and that their use of its content to train LLMs without consent “constitutes free-riding on The Times’s significant efforts and investment of human capital to gather this information.”
The Times said Microsoft and OpenAI’s LLMs “can generate output that recites Times content verbatim, closely summarizes it, and mimics its expressive style,” and “wrongly attribute false information to The Times,” and “deprive The Times of subscription, licensing, advertising, and affiliate revenue.”
— CNBC’s Rohan Goswami contributed to this report.
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Google CEO Sundar Pichai addresses the crowd during Google’s annual I/O developers conference in Mountain View, California on May 20, 2025.
Camille Cohen | AFP | Getty Images
The Google Doodle is Alphabet’s most valuable piece of real estate, and on Tuesday, the company used that space to promote “AI Mode,” its latest AI search product.
Google’s Chrome browser landing pages and Google’s home page featured an animated image that, when clicked, leads users to AI Mode, the company’s latest search product. The doodle image also includes a share button.
The promotion of AI Mode on the Google Doodle comes as the tech company makes efforts to expose more users to its latest AI features amid pressure from artificial intelligence startups. That includes OpenAI which makes ChatGPT, Anthropic which makes Claude and Perplexity AI, which bills itself as an “AI-powered answer engine.”
Google’s “Doodle” Tuesday directed users to its search chatbot-like experience “AI Mode”
AI Mode is Google’s chatbot-like experience for complex user questions. The company began displaying AI Mode alongside its search results page in March.
“Search whatever’s on your mind and get AI-powered responses,” the product description reads when clicked from the home page.
AI Mode is powered by Google’s flagship AI model Gemini, and the tool has rolled out to more U.S. users since its launch. Users can ask AI Mode questions using text, voice or images. Google says AI Mode makes it easier to find answers to complex questions that might have previously required multiple searches.
In May, Google tested the AI Mode feature directly beneath the Google search bar, replacing the “I’m Feeling Lucky” widget — a place where Google rarely makes changes.
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Disposable diapers are a massive environmental offender. Roughly 300,000 of them are sent to landfills or incinerated every minute, according to the World Economic Forum, and they take hundreds of years to decompose. It’s a $60 billion business.
One alternative approach has been compostable diapers, which can be made out of wood pulp or bamboo. But composting services aren’t universally available and some of the products are less absorbent than normal nappies, critics say.
A growing number of parents are also turning to cloth diapers, but they only make up about 20% of the U.S. market.
ZymoChem is attacking the diaper problem from a different angle. Harshal Chokhawala, CEO of ZymoChem, said that 60% to 80% of a typical diaper consists of fossil-based plastics. And half of that is an ingredient called super absorbent polymer, or SAP.
“What we have created is a low carbon footprint bio-based and biodegradable version of this super absorbent polymer,” Chokhawala said.
ZymoChem, with operations in San Leandro, California, and Burlington, Vermont, invented this new type of absorbent by using a fermentation process to convert a renewable resource — sugar — from corn into biodegradable materials. It’s similar to making beer.
“We’re at a point now where we’re very close to being at cost parity with fossil based manufacturing of super absorbents,” said Chokhawala.
The company’s drop-in absorbents can be added into other diapers, which makes it different from environmentally conscious companies like Charlie Banana, Kudos and Hiro, which sell their own brand of diapers.
ZymoChem doesn’t yet have a diaper product on the market. But Lindy Fishburne, managing partner at Breakout Ventures and an investor in the company, says it’s a scalable model.
“Being able to build and grow with biology allows us to unlock a circular economy and a supply chain that is no longer petro-derived, which opens up the opportunities of where you can manufacture and how you secure supply chains,” Fishburne said.
Other investors include Toyota Ventures, GS Futures, KDT Ventures, Cavallo Ventures and Lululemon. The company has raised a total of $35 million.
The Lululemon partnership shows that it’s not just about diapers. ZymoChem’s bio-based materials can also be used in other hygiene products and in bio-based nylon. Lululemon recently said it will use it in some of its leggings, which were traditionally made with petroleum.
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Dylan Field, co-founder and CEO of Figma, appears at the Bloomberg Technology Summit in San Francisco on May 9, 2024.
David Paul Morris | Bloomberg | Getty Images
Design software company Figma filed for an IPO on Tuesday, and plans to trade on the New York Stock Exchange under ticker symbol “FIG.”
The offering would be one of the hotly anticipated IPOs in recent years given Figma’s growth rate and its high private market valuation. In late 2023, a $20 billion acquisition agreement with Adobe was scrapped due to regulatory concerns in the U.K. That led Adobe to pay Figma a $1 billion termination fee.
Revenue in the first quarter increased 46% to $228.2 million from $156.2 million in the same period a year ago, according to Figma’s prospectus. The company recorded a net income of $44.9 million, compared to $13.5 million a year earlier.
As of March 31, Figma had around 450,000 customers. Of those, 1,031 were contributing at least $100,000 a year to annual revenue, up 47% from a year earlier. Clients include Amazon Web Services, Google, Microsoft and Netflix. More than half of revenue comes from outside the U.S.
Figma didn’t say how many shares it plans to sell in the IPO. The company was valued at $12.5 billion in a tender offer last year, and in April it announced that it had confidentially filed for an IPO with the SEC.
Wall Street banks predicted a rush of IPOs after Donald Trump won the U.S. presidential election in November following a dry spell dating back to late 2021, when soaring inflation and rising interest rates pushed investors out of risky assets. While President Trump’s announcement of sweeping tariffs in April roiled markets and led a number of companies to delay their plans, activity has been picking up of late.
Stablecoin issuer Circle doubled in value in its early June debut and is now up more than sixfold from its IPO price for a market cap of almost $43 billion. Online banking company Chime also debuted in June, following Hinge Health’s IPO in May. Artificial infrastructure provider CoreWeave, which went public in March, jumped 46% in June and has quadrupled since its offering.
Buy now, pay later company Klarna, based in the U.K., filed for a U.S. IPO in March, as did ticket marketplace StubHub.
Figma was founded in 2012 by CEO Dylan Field, 33, and Evan Wallace, and is based in San Francisco. The company had 1,646 employees as of March 31.
Before establishing Figma, Field spent over two years at Brown University, where he met Wallace. Field then took a Thiel Fellowship “to pursue entrepreneurial projects,” according to the filing. The two-year program that Founders Fund partner Peter Thiel established in 2011 gives young entrepreneurs a $200,000 grant along with support from founders and investors, according to an online description.
Field is the biggest individual owner of Figma, with 56.6 million Class B shares and 51.1% of voting power ahead of the IPO. He said in a letter to investors that it was time for Figma to buck the “trend of many amazing companies staying privately indefinitely.”
Databricks, SpaceX and Stripe are among high-valued companies that are still private.
“Some of the obvious benefits such as good corporate hygiene, brand awareness, liquidity, stronger currency and access to capital markets apply,” he wrote, explaining the decision. “More importantly, I like the idea of our community sharing in the ownership of Figma — and the best way to accomplish this is through public markets.”
Field added that as a public company, investors should “expect us to take big swings,” including through acquisitions. In April Figma bought the assets and team of an unnamed technology company for $14 million, according to the filing.
The IPO will also mark another much-needed win for Silicon Valley venture firms, which are in need of returns after the multi-year slump. Index Ventures is the largest outside shareholder, with a 17% stake before the offering, according to the filing. Greylock owns 16%, Kleiner Perkins controls 14% and Sequoia has a stake of 8.7%.
Figma said it faces “intense competition” and that loss of market share would “adversely affect our business,” but didn’t name any specific competitors.
Over 13 million people use Figma per month, and only one-third of them are designers, according to the filing. In March the company announced Figma Sites, a tool that turns designs into working websites. It’s one of a few new products that diversify the company away from its collaborative service for crafting app and website designs.
As of March 31, Figma had $1.54 billion in cash, cash equivalents and marketable securities.
Using its cash, Figma has begun investing in digital currencies. In 2024, Figma’s board authorized a $55 million investment into a Bitwise Bitcoin exchange-traded fund. As of March 31, the holding was worth $69.5 million, according to the filing. In May, the board approved a $30 million investment in Bitcoin, and Figma spent the money on USD Coin, which is a stablecoin.
Morgan Stanley and Goldman Sachs are leading the deal along with Allen and Co. and JPMorgan Chase.
Correction: A prior version of this story had the incorrect stock exchange in the headline.
— CNBC’s Ari Levy and Jonathan Vanian contributed to this report.
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