Wall Street Journal and New York Post Sue Perplexity AI for Copyright Infringement

The journalism landscape enters a challenging phase as two prominent publications, The Wall Street Journal and the New York Post, escalate their disputes with the tech industry into the legal arena. On Monday, they lodged a substantial lawsuit in a federal court in New York against Perplexity AI, a Silicon Valley-bred AI company renowned for its innovative search engine technology poised to rival Google's dominance.

At the core of the lawsuit lies the allegation that Perplexity AI's platform, which aims to streamline information access through its question-answering capabilities, breaches copyright by using content from the plaintiffs without authorization. Unlike other AI models such as ChatGPT or Claude by Anthropic, which generate responses without direct citations, Perplexity's model prides itself on delivering contemporary, source-linked answers — a feature that, while ostensibly transparent and user-friendly, is now under intense scrutiny.

🚨BREAKING: Wall Street Journal and New York Post owned by News Corp, sue Perplexity AI for copyright infringement!

Filed in NYC federal court on Oct 21, 2024, the lawsuit accuses Perplexity of "massive illegal copying" of their content to power its AI, directly competing with… pic.twitter.com/vApLkjvx84

— Headline Hungama (@HungamaHeadline) October 22, 2024

The plaintiffs argue that Perplexity's business model underpins a severe divergence from traditional search engines. The latter drives traffic to original content creators, potentially monetizing through clicks. Conversely, Perplexity's provision of ready-made answers devoid of necessary click-through could be undercutting publishers. The lawsuit paints this as "massive freeriding," a form of exploitation of the publishers' intellectual property that negatively impacts their reader base and revenue streams.

Further compounding the issue, the suit alleges that Perplexity's actions result in reputational harm; by occasionally attributing incorrect information to these well-established news providers, it inadvertently misinforms the public and tarnishes the credibility painstakingly built by these institutions.

Financially, the stakes are high, with demands for statutory damages reaching up to $150,000 per instance of infringement, alongside a call for injunctive relief. The publishers also insist upon the elimination of any databases holding their copyrighted works within Perplexity's digital vaults.

This legal struggle echoes earlier contentions by The New York Times, which similarly dispatched a cease and desist to Perplexity — a precursor to potential legal proceedings. In a comparable vein, the Times engaged OpenAI, the creators behind ChatGPT, in legal action, condemning the exploitation of copyrighted material to augment their AI's capabilities.

Interestingly, News Corp (parent company of both the Journal and the Post) has secured a content partnership with OpenAI. However, Perplexity has not shown interest in entering such an agreement, according to the suit's details. Amidst this unfolding drama, Perplexity remained silent, with no immediate public response.

The current scenario raises pressing questions about intellectual property rights, technological advancement, and the intricate balance between innovation and ethical content utilization in the digital age. As such, the outcomes of these lawsuits could have far-reaching implications for AI developers and content creators alike, possibly redefining the relationship between technology firms and the media industry.