Letter from the Editor-in-Chief

THOMAS A. WARD
Editor-in-Chief of New Matter

WELCOME TO THE FALL EDITION OF New Matter for 2025. The cover of this edition showcases the first major copyright lawsuit against AI company Midjourney brought by Disney and Universal over machine learning by Midjourney using Disney and Universal copyrighted materials that enabled Midjourney to generate content using AI. As the title on the cover indicates, Disney and Universal call the actions by Midjourney a "Bottomless Pit of Plagiarism."

Disney and Universal jointly sued Midjourney, a prominent AI image generation company. The lawsuit, filed in the Central District of California, alleges that Midjourney’s AI tools unlawfully generate and distribute images of Disney and Universal’s copyrighted characters and other intellectual property without authorization. In other words, Disney and Universal are alleging that Midjourney infringed their copyrights when they trained their AI image generating models using copyrighted material. Disney and Universal are seeking damages and an injunction to prevent further infringement.

Disney and Universal face Midjourney just as the Federal Circuit decision made in June of 2025 has backed AI training as fair use. In Bartz v. Anthropic, the Federal Circuit held that training a generative AI model using copyrighted books—where the books were used to develop statistical relationships for generating new, original outputs—constituted a "quintessentially transformative" fair use under Section 107 of the Copyright Act. The court emphasized that the AI outputs did not reproduce or distribute infringing content and that the training process, while involving multiple copies of the works, served a fundamentally different purpose than the original works. Although the Anthropic decision did not excuse unauthorized acquisition of pirated works for building a general-purpose library, it strongly favored fair use where the copyrighted content was used specifically for model training. This precedent may bolster Midjourney’s defense if it can demonstrate that its model outputs do not recreate protected content and that any training use of copyrighted material was similarly transformative. The outcome of this first AI copyright suit will, in any case, be informative to our IP attorney readers as the lawsuit progresses.