Microsoft pledges legal protection for AI-generated copyright breaches

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Microsoft has pledged to assume legal responsibility for any copyright infringement over material generated by the artificial intelligence software it offers to businesses in Word, PowerPoint and its coding tools, as concerns mount over potential clashes with content owners.

The US tech giant on Thursday committed itself to paying any legal costs for commercial customers who are sued for using tools or any output generated by AI.

Microsoft will protect paying customers of its $19-a-month GitHub Copilot, which creates computer code with generative AI, as well as Microsoft 365 Copilot, which applies AI to products including Word, Teams and PowerPoint. The 365 Copilot is still being tested by a select few businesses.

“This move opens up the market,” said Ilanah Fhima, professor of intellectual property law at University College London, and “makes that software more usable as it removes one of the obstacles for businesses if they know that they have that reassurance”.

Battles over generative AI and copyright have led to lawsuits from stock image providers such as Getty Images against AI companies. Artists, singers, media companies and publishers have claimed that copyrighted materials have been used to train large language models without consent or compensation.

Adobe made a similar pledge to indemnify users of its Firefly AI tool in June. The moves by some of the world’s biggest software developers seek to reassure paying users, as concerns have risen about the widespread use of generative AI and its potential to produce passages of text or imagery that replicate a copyrighted source the technology was trained on.

Hossein Nowbar, general counsel of corporate legal affairs at Microsoft, acknowledged customers’ concerns about the risk of IP infringement claims if they use the output produced by generative AI.

“This is understandable, given recent public inquiries by authors and artists regarding how their own work is being used in conjunction with AI models and services,” he said in a blog post on Thursday.

“If you are challenged on copyright grounds, we will assume responsibility for the potential legal risks involved,” he added.

If paying customers faced legal issues for using “our Copilots”, Nowbar said, “we should make this our problem rather than our customers’ problem”.

If a third party sues a commercial customer for the use of Copilot or the output generated, Microsoft will defend the customer and “pay the amount of any adverse judgments or settlements that result from the lawsuit, as long as the customer used the guardrails and content filters we have built into our products”, the blog post said.

Microsoft said its “guardrails” included content filters and detection of potentially infringing third-party content.

UCL’s Fhima highlights that many disputes, laws and legal precedents surrounding AI and copyright are still in development and, therefore, may not lead to hefty costs for Microsoft.

“There is a public interest in there being technological development, and strict rights of copyright aren’t always enforced,” she added. “The risk that Microsoft is taking may well be a calculated risk.”