Real Safety AI Foundation / Research

Copyright, Creative Labor, and Generative AI

The Infringing Machine: Commercial Exploitation and AI Copyright Liability

Publisher: Real Safety AI Foundation

Preprint / working draft. Not peer reviewed.

Written
April 2026
Version
v7
Pages
22
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Abstract

When AI systems generate outputs that reproduce copyrighted works, the liability analysis is more straightforward than prevailing discourse suggests. AI companies know their models memorize copyrighted content. They sell access to those models. Commercial exploitation of copyrighted content known to exist within a product constitutes infringement under existing doctrine. This Article cuts through the epistemological debates surrounding training data, neural network “learning,” and machine cognition. These questions, while intellectually interesting, are largely irrelevant to the liability determination. What matters is that companies possess the right and ability to supervise infringing output, profit directly from that output, and have chosen not to prevent it effectively. Under established precedent, this constitutes vicarious and contributory infringement.

Keywords

  • AI copyright
  • vicarious liability
  • contributory infringement
  • inducement
  • Grokster
  • DMCA safe harbor
  • Sony doctrine
  • memorization
  • training data
  • secondary liability
  • GEMA v. OpenAI
  • generative AI
  • commercial exploitation
  • machine-generated works
  • Stanford extraction study

Plain language slides

First slide of the plain language summary of The Infringing Machine: Commercial Exploitation and AI Copyright LiabilityOpen the 17-slide summary (PDF)

Suggested citation

Gilly, Travis. "The Infringing Machine: Commercial Exploitation and AI Copyright Liability." Real Safety AI Foundation Preprint / Working Draft, April 2026. https://realsafetyai.org/research/g7hcj5/

Other versions

This paper is also posted on SSRN.

SSRN version

References (27)

This paper cites its sources in footnotes. Each authority is listed once, where it is first cited, with its footnote number.

  1. Footnote 2.Ahmed Ahmed, A. Feder Cooper, Sanmi Koyejo & Percy Liang, Extracting Books from Production Language Models, arXiv:2601.02671 (Jan. 6, 2026), available at https://papers.ssrn.com/sol3/papers.cfm?abstract_id=6050534.
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  3. Footnote 7.316 F.2d 304 (2d Cir. 1963).
  4. Footnote 8.239 F.3d 1004 (9th Cir. 2001).
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  9. Footnote 12.MGM Studios, Inc. v. Grokster, Ltd., 545 U.S. 913, 936–37 (2005).
  10. Footnote 15.CoStar Grp., Inc. v. LoopNet, Inc., 373 F.3d 544 (4th Cir. 2004)
  11. Footnote 15.Cartoon Network LP, LLLP v. CSC Holdings, Inc., 536 F.3d 121 (2d Cir. 2008).
  12. Footnote 17.Perfect 10, Inc. v. Amazon.com, Inc., 508 F.3d 1146, 1160–61 (9th Cir. 2007).
  13. Footnote 18.GEMA v. OpenAI, Munich I Regional Court, Case No. 42 O 14139/24 (Nov. 11, 2025).
  14. Footnote 18.16, and 19a of the German Copyright Act (Urheberrechtsgesetz) and Articles 2 and 3 of the EU InfoSoc Directive 2001/29/EC.
  15. Footnote 20.464 U.S. 417 (1984).
  16. Footnote 23.Campbell v. Acuff-Rose Music, Inc., 510 U.S. 569, 581 (1994).
  17. Footnote 24.Complaint, N.Y. Times Co. v. Microsoft Corp., No. 1:23-cv-11195 (S.D.N.Y. Dec. 27, 2023), Exs. J, K.
  18. Footnote 25.17 U.S.C. § 107.
  19. Footnote 26.Greenman v. Yuba Power Prods., Inc., 59 Cal.2d 57 (1963).
  20. Footnote 27.17 U.S.C. § 512.
  21. Footnote 28.17 U.S.C. § 512(c)(1).
  22. Footnote 29.17 U.S.C. § 512(c)(1)(A)–(C).
  23. Footnote 30.Viacom Int’l, Inc. v. YouTube, Inc., 676 F.3d 19 (2d Cir. 2012).
  24. Footnote 31.17 U.S.C. § 502(a) (“Any court having jurisdiction of a civil action arising under this title…may…grant temporary and permanent injunctions on such terms as it may deem reasonable to prevent or restrain infringement of a copyright.”).
  25. Footnote 32.A&M Records, Inc. v. Napster, Inc., 239 F.3d 1004, 1027 (9th Cir. 2001).
  26. Footnote 33.17 U.S.C. § 504.
  27. Footnote 34.17 U.S.C. § 504(c)(2).

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