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In a high-stakes legal battle with sweeping implications for AI and copyright law, a Delaware federal judge ruled Tuesday that ROSS Intelligence illegally copied more than 2,200 headnotes from Thomson Reuters’ Westlaw to train its competing AI-powered legal research tool.

The decision, issued by U.S. Circuit Judge Stephanos Bibas, delivers a major victory for Thomson Reuters, reinforcing the copyright protections surrounding Westlaw’s editorial content and key number system.

The ruling reverses a 2023 decision in which Bibas declined to grant summary judgment for Thomson Reuters and did not dismiss ROSS’s fair use defense.

AI and Fair Use: A Legal Battleground

This case has been closely watched as a bellwether for AI copyright disputes, particularly as courts grapple with fair use claims in AI training—an issue at the heart of ongoing lawsuits involving OpenAI, Meta, and other tech giants.

While Judge Bibas noted that ROSS’s technology is not generative AI, his findings could influence future litigation surrounding the use of copyrighted materials to train AI models.

Westlaw’s Content Protected Under Copyright

Thomson Reuters had long argued that Westlaw’s headnotes—short summaries of legal rulings—and its key number system were original works protected by copyright law.

On Tuesday, Judge Bibas agreed, concluding that ROSS’s use of Westlaw’s content was both commercial and non-transformative, a determination that tipped the scales against fair use.

ROSS’s Defense Falls Flat

The lawsuit, filed in 2020, accused ROSS of deliberately circumventing copyright protections after Westlaw refused to license its database. Instead, ROSS allegedly partnered with LegalEase to obtain “bulk memos”—compilations of legal questions and answers that were ultimately sourced from Westlaw.

Judge Bibas was unpersuaded by ROSS’s arguments that its use of headnotes was covered under fair use, innocent infringement, or copyright misuse.

Market Impact Seals ROSS’s Fate

A key factor in the court’s reversal of its previous ruling was the market impact of ROSS’s AI tool.

Initially, Bibas had left this issue for a jury to decide, speculating that ROSS’s platform might serve a different purpose than Westlaw. But on Tuesday, the judge walked back that position.

The court ruled that ROSS’s AI model harmed the potential market for AI-powered legal research tools and that it was irrelevant whether Thomson Reuters had plans to develop its own AI search technology.

What’s Next for ROSS?

While Judge Bibas’s ruling delivers a crushing blow to ROSS’s defense, some issues remain unresolved, including whether certain copyrights have expired. These will be decided by a jury at a later stage.

Thomson Reuters, in a victorious statement, emphasized that its editorial content is protected and cannot be used without consent.

ROSS’s legal team has not yet commented on the ruling.

With AI copyright disputes escalating, this decision could serve as a legal precedent for upcoming battles over AI training data, fair use, and market competition in the rapidly evolving world of artificial intelligence.