The case may yet go to trial after a federal judge on Monday criticized a $1.5 billion settlement between authors who claim almost half a million books were unlawfully copied to train chatbots and the artificial intelligence startup Anthropic.
U.S. District Judge William Alsup held a second hearing in San Francisco on September 25 to examine whether his concerns had been addressed after he spent almost an hour primarily criticizing a settlement that he says is riddled with hazards.
Before adjourning the hearing on Monday, Alsup stated, "We'll see if I can hold my nose and approve it."
In recognition that the proposed resolution might backfire, the head of a publishers' group involved in the settlement later referred to portions of the judge's updated timeline for accepting the arrangement as "troubling."
According to Maria Pallante, CEO of the Association of American Publishers, who was not invited to speak at the hearing on Monday, Alsup "displayed a lack of understanding of how the publishing industry works."
A few days after Anthropic and the lawyers who brought the class-action complaint announced a $1.5 billion settlement aimed at resolving the pirating charges and avoiding a trial that was supposed to start in December, the judge's concerns surfaced.
In June, Alsup rendered a split decision in the case, concluding that while it was permissible to train AI chatbots on copyrighted books, Anthropic had improperly obtained millions of books from pirate websites in order to enhance its Claude chatbot.
For each book covered by the deal, writers and publishers would receive roughly $3,000 as part of the proposed settlement.
About 465,000 books are on the list of works that Anthropic has pirated, according to Justin Nelson, the authors' lawyer, who spoke to Alsup. The judge stated that in order to prevent the corporation from being caught off guard by other cases "coming out of the woodwork," he required more definite guarantees that the number would not increase.
The judgment gave the judge until September 15 to create a "drop-dead list" of all the publications that had been stolen.
In order to make sure that everyone who qualifies is aware of the claims procedure and prevent the writers from "getting the shaft," Alsup's primary worry was how it would be managed. Before the September 25 hearing to reexamine the settlement, he established a deadline of September 22 for submitting a claims form for his consideration.
The judge also expressed concerns about two significant organizations involved in the lawsuit, the Association of American Publishers and the Authors Guild, operating "behind the scenes" in ways that would coerce some authors into accepting the settlement before fully comprehending it.
Mary Rasenberger, the CEO of the Authors Guild, sat next to Pallante at the hearing on Monday and was questioned about the settlement. In addition to sitting in the front row of the court gallery, the three authors who filed the lawsuit last year—nonfiction writers Kirk Wallace Johnson, Charles Graeber, and thriller novelist Andrea Bartz—did not speak to Alsup.
The Authors Guild stated in a statement following the hearing that it was "confused" by Alsup's suspicion that it was covertly attempting to discredit some of the authors included by the settlement.
