Perplexity faces multiple lawsuits from publishers
NYT seeks damages and injunctive relief against startup
The Times previously sent a cease-and-desist letter to Perplexity.
Dec. 5 (Reuters) – New York Times (NYT.N)opens a new tab filed a lawsuit against Perplexity AI on Friday, alleging that the artificial intelligence startup copied, distributed and displayed millions of articles without permission to power its generative AI products.
The startup has been the target of multiple legal disputes and faces similar accusations from a number of publishers as it aggressively seeks share in the highly competitive market for generative AI tools.
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The Times also alleged that the company's generative AI products created fabricated content, or “illusions,” and displayed them alongside registered trademarks to falsely attribute the content to the newspaper.
Perplexity's business model relies on scraping and copying content, including content protected by paywalls, the company said.
“We believe in the ethical and responsible use and development of AI, and we firmly oppose Perplexity's unauthorized use of our content to develop or promote its own products,” NYT spokesperson Graham James said in a statement.opens a new tab.
The NYT is seeking damages, injunctive relief, and other equitable relief to prevent Perplexity from continuing its alleged unauthorized use of the content.
Perplexity was also sued Thursday by the Chicago Tribune.opens a new tab.
Jesse Dwyer, the company's head of communications, dismissed the suit, saying it was a failed tactic used by publishers against emerging technology.
Perplexity previously said it was not scraping data to build the underlying model, but indexing web pages and providing factual citations.
The lawsuit was filed in the U.S. District Court for the Southern District of New York, more than a year after the NYT sent Perplexity a cease and desist notice.
It's also the latest salvo in an ongoing battle between publishers and technology companies over the unauthorized use of copyrighted content.
In October, social media company Reddit (RDDT.N)opens a new tab filed suit in New York federal court, accusing Perplexity and three other companies of illegally scraping data.
The San Francisco-based startup, which has a market capitalization of about $20 billion, also faces lawsuits from Encyclopedia Britannica, media mogul Rupert Murdoch's Dow Jones and the New York Post.
The New York Times cleared Amazon.com (AMZN.O)opens a new tab It is also battling ChatGPT maker OpenAI to use its editorial content in AI products such as Alexa.
Reuters reported last year that multiple AI companies were bypassing web standards used by publishers to block scraping of data used in generative AI systems.
NYT stock rose 1.8%.
Reporting by Jaspreet Singh in Bengaluru; additional reporting by Arnab Mishra in Bengaluru. Editing: Arun Koyyur, Anil D'Silva
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