The owners of the Wall Street Journal and New York Post have filed a copyright infringement lawsuit against AI company Perplexity in a New York federal court. The case could set an important precedent for similar lawsuits in the music industry against AI companies.

Key allegations in the lawsuit:

• Perplexity allegedly copied hundreds of thousands of copyrighted articles without permission for its retrieval-augmented generation (RAG) database
• The company is accused of creating unauthorized full or partial reproductions of articles, including content behind paywalls
• Additional copies were allegedly made to preserve AI-generated outputs for analysis
• The platform is accused of generating false content ("hallucinations") and wrongly attributing it to the publications' articles and authors

The plaintiffs attempted to discuss licensing options with Perplexity in July 2024 but received no response. The company, valued at potentially $8 billion and backed by Jeff Bezos and Nvidia, is now facing demands for substantial damages and court orders to:

• Stop unauthorized copying of protected materials
• Destroy any index or database containing the copyrighted content

This case differs from other AI lawsuits by focusing on multiple stages of alleged infringement, particularly challenging the fair use defense commonly used by AI companies.

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