Massive Class Action Against Anthropic Threatens to Throw the AI Industry Into Chaos

A storm has erupted in the US artificial intelligence landscape — one that could wipe out billions of dollars in months and shake the foundations of the entire sector. Three authors have launched a class action against start-up Anthropic, accusing it of copyright infringement. At first glance, it sounds like another routine legal dispute, but the stakes are made clear by the fact that as many as seven million rights holders could join, covering works from the past century. Potential damages run into the hundreds of billions, with each claimant able to seek up to $150,000 in statutory penalties.

The decisive moment came when Judge William Alsup certified the case as a class action, citing his “fifty years” of experience. Anthropic is fiercely contesting the decision, arguing that the judge failed to examine who exactly qualifies as a claimant, which works are involved, and what licences may apply to them.

Anthropic has the backing of powerful tech industry groups, including the Consumer Technology Association and the Computer & Communications Industry Association, who warn that allowing the suit to proceed would set a dangerous precedent. They argue it could unleash a wave of massive claims, freeze investment, and deliver a severe blow to US technological competitiveness.

One of the biggest hurdles lies in defining the rights to millions of works. “Orphan works” — those with unknown authors, deceased authors’ heirs, defunct publishers, and fragmented rights — could turn the case into tens or hundreds of separate lawsuits. Further complicating matters, authors and publishers may not share the same interests: some might oppose the suit, while others will strongly support it.

In theory, notifying potential claimants is their own responsibility, but in practice it means many rights holders may never learn of the proceedings. The technical feasibility of the case is also in doubt, as coordinating such a vast and complex pool of claimants is nearly impossible.

Experts warn that if the class action designation stands, it could stall the development of generative AI for years and leave copyright questions hanging indefinitely. The fallout would shake not just one company, but the very foundations of the AI industry.