The New York Times, the Daily News, and other major news organizations are escalating their legal battle against OpenAI, asking a federal judge to impose sanctions on the AI company for what they say is deliberate obstruction of evidence in a copyright infringement case that could reshape the future of American journalism.
Thursday's filing in Manhattan federal court alleges OpenAI "chose obstruction" over releasing critical datasets and ChatGPT logs that would show how the company's AI system used millions of copyrighted news articles without permission or compensation. The newspapers argue that a recent deposition of an OpenAI employee directly contradicts the company's earlier claims about its ability to identify and account for copyrighted content in its training materials.
New York Daily News attorney Steven Lieberman said OpenAI has been "making misrepresentations" for two years about its capacity to search for copyrighted content in its AI training datasets and logs. "This motion asks the court to punish OpenAI for hiding and destroying evidence showing how ChatGPT was trained on stolen journalism," Lieberman said, representing the Daily News and seven sister publications.
The Core Issue
At stake is whether AI chatbots are unfairly competing as information sources, drawing web traffic away from news organizations without performing the costly work of gathering, reporting, and verifying news. The newspapers contend they've invested billions in their journalistic operations only to have AI companies harvest their content to build competing products that don't require similar investment.
OpenAI has defended its position by citing user privacy concerns. "As the Times' case weakens and they've been forced to drop claims against us, they're persisting with their efforts to invade the privacy of people who have nothing to do with this case, including by making these blatantly false allegations," OpenAI spokesperson Drew Pusateri said Thursday. "We'll continue defending our users' privacy and the long-established principles of fair use."
The Times sued OpenAI and Microsoft about three years ago, shortly after ChatGPT's debut sparked a commercial AI boom and fundamentally changed how people search for information. The competitive threat intensified about two years ago when Google introduced AI-generated summaries at the top of search results, cutting off the advertising revenue that flows when users click through to original news sources. Google's move demonstrated the existential risk facing news organizations: AI systems could displace their traffic without providing compensation.
The Expanding Legal Battle
The Times has since been joined by MediaNews Group-owned newspapers, the Daily News, the Chicago Tribune, digital media publisher Ziff Davis, and the nonprofit Center for Investigative Reporting. Together, they're testing whether AI companies can legally train their systems on copyrighted material under the "fair use" doctrine of U.S. copyright law.
OpenAI and other tech companies argue that training AI on digitized books, articles, and online writings is protected fair use. That theory is being tested in dozens of lawsuits across creative industries—visual artists, novelists, and music record labels have all sued AI companies, with mixed results. In the largest copyright settlement to date, OpenAI rival Anthropic agreed to pay book authors $1.5 billion for training its Claude chatbot on their pirated works. That settlement, however, represents only a small fraction of Anthropic's $965 billion market valuation as the company prepares to go public.
The Times' legal strategy differs from the book authors' approach. Rather than focusing solely on copyright infringement, the newspaper emphasizes unfair competition—arguing that AI companies are "free-riding" on decades of investment in journalism to build substitutive products without permission or payment. The Times has already spent more than $28 million fighting AI companies in court, according to financial disclosures. Those costs include a separate lawsuit filed last year against AI company Perplexity.
Among the sanctions the newspapers are seeking Thursday are attorney fees to cover the cost of obtaining "improperly withheld" evidence. The request signals the publishers' frustration with what they see as stonewalling by a company that claims to operate transparently.
A Diverging Market Response
Meanwhile, a growing number of media organizations have taken a different path, signing licensing deals with OpenAI and other AI companies including Google and Meta. These agreements typically provide a fee to media outlets in exchange for allowing AI systems to train on their news feeds or archives. The Associated Press announced such a deal with OpenAI about three years ago, becoming the first major news organization to do so.
Those licensing arrangements suggest that at least some news publishers believe negotiated compensation—rather than litigation—is the more pragmatic path forward. The deals acknowledge that AI training on news content is happening regardless, and that securing payment upfront may be preferable to years of costly litigation with uncertain outcomes.
Why This Matters:
This case will likely determine whether news organizations can maintain control over their content in an AI-driven economy, or whether tech companies can freely use copyrighted material under fair use protections. The outcome affects not just the Times and other major publishers, but the entire economics of journalism. If AI companies can train systems on news content without compensation, the financial model that funds investigative reporting, beat reporters, and editorial staff becomes unsustainable. The newspapers' push for sanctions suggests they believe OpenAI is deliberately hiding evidence that would prove the company knew it was using copyrighted material. From a market perspective, the dispute reflects a fundamental question: Should AI development be constrained by existing copyright law, or should the law adapt to accommodate new technology? The licensing deals some publishers have signed indicate they've chosen negotiation over litigation, betting that structured compensation is better than the uncertainty of court battles that could drag on for years.