Hollywood studio threatens ByteDance with legal action amid AI scandal

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After a fake video of Tom Cruise and Brad Pitt fighting went viral, AI-generated content from Seadance 2.0 flooded the internet.

Some fans were using a new AI video generator backed by ByteDance to re-create the finales of shows like “Game of Thrones” and “Stranger Things.” Some have created fight scenes between iconic superheroes such as Wolverine and Superman, or between Transformers and Godzilla.

These Seedance videos racked up millions of views on social media, prompting industry guilds like SAG-AFTRA and the Motion Picture Assn. to criticize the AI ​​platform launched last week. A number of major Hollywood studios are now threatening legal action against ByteDance, the same Chinese parent company that oversees TikTok.

Netflix, Warner Bros. Discovery, Paramount, and Disney all sent separate cease-and-desist letters detailing the unauthorized reproduction of each studio’s copyrighted intellectual property.

Netflix and Warner Bros. Discovery were the latest studios to send cease-and-desist letters to ByteDance on Tuesday.

Netflix calls Seedance a “high-velocity privacy engine” and, as stated in the letter, “We will not stand by while ByteDance treats our valuable IP as free public domain clip art.” The streamer also cited the illegal use of sets from “Squid Game,” costumes from “Bridgerton,” and character designs from “KPop Demon Hunters.”

Warner Bros. Discovery considers ByteDance’s reuse of content, including characters from the Harry Potter and Lord of the Rings series and superheroes such as Batman, to be “blatant infringement.” The studio claims it is clear that its AI technology was trained on Warner Bros.’ copyrighted material “without permission.”

“But users are not the root cause of infringement. Because SeaDance comes preloaded with Warner Bros. Discovery’s copyrighted characters, users are simply building on the foundation of infringement already laid by ByteDance,” wrote Wayne Smith, the studio’s vice president of legal operations. “That was an intentional design choice by ByteDance.”

Disney and Paramount were the first studios to call ByteDance, sending letters last Friday and Saturday. Disney accuses ByteDance of loading its SeaDance service with “a pirated library of Disney copyrighted characters from Star Wars, Marvel, and other Disney series.”

“Despite Disney’s well-known objections, ByteDance is hijacking Disney characters by recreating, distributing, and creating derivative works featuring those characters. ByteDance’s substantial usurpation of Disney’s intellectual property is intentional, pervasive, and completely unacceptable,” Disney attorney David Singer wrote in Axios.

Paramount’s cease-and-desist letter, reviewed by the Times, makes similar allegations about ByteDance’s unauthorized use of copyrighted material.

ByteDance subsequently committed to implementing further safeguards to protect copyrighted material in response to these letters.

“ByteDance respects intellectual property rights and has heard your concerns about SeaDance 2.0,” a company spokesperson said in a statement shared with CNBC. “We are taking steps to strengthen our current safeguards to prevent unauthorized use of our intellectual property and likeness by our users.”

But Dan Purcell, CEO of Midnight Labs, an AI-powered company that specializes in protecting intellectual property for high-value entertainment, with or without safeguards, said the letters may be a bit of a late reaction from studios.

“Once synthetic content is generated, it quickly spreads at scale. By the time lawyers intervene, the damage is done,” Purcell said in a statement. “The only path forward is through strict licensing, real-time enforcement, and real damaging consequences. Reactive letters will not solve this problem. The industry needs to move at the speed of AI, not the speed of litigation.”



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