Third Circuit: AI training on copyrighted works isn't fair use
The Third Circuit ruled AI training using copyrighted works violates fair use.
Why it matters: This ruling sets a key precedent for legal tech firms and IP practitioners, clarifying copyright limits on AI training. It emphasizes the need for compliance when using copyrighted content in AI development.
- On September 29, 2026, the Third Circuit affirmed that ROSS Intelligence's use of Westlaw headnotes to train AI was not fair use.
- This is the first U.S. appellate decision addressing fair use in AI training contexts.
- The court stated using someone else's 'creative spark' to create a competing product infringes copyright law.
- The decision affects legal tech firms and content creators developing AI tools based on copyrighted materials.
On September 29, 2026, the U.S. Court of Appeals for the Third Circuit issued a landmark ruling clarifying that AI training using copyrighted content does not constitute fair use. The court affirmed a lower court's decision against ROSS Intelligence, which had employed Thomson Reuters' copyrighted Westlaw headnotes to train its AI legal research tool.
This case marks the first time a U.S. appellate court has addressed whether training AI on copyrighted works qualifies as fair use under Section 107 of the Copyright Act. The ruling highlights the importance of copyright protections in AI development, especially when the trained AI competes with the rights holder's products.
In its opinion, the Third Circuit emphasized that "using someone else's 'creative spark' to start a competing business runs afoul of copyright law," signaling that unauthorized use of creative content in AI training can constitute infringement.
This precedent has significant implications for legal technology firms and developers across industries who rely on copyrighted content to train AI systems. It underscores the necessity of obtaining proper authorization from copyright holders to avoid liability.
Because the full court opinion remains under seal, detailed legal reasoning is not publicly available. However, the ruling clearly positions copyright law as a key framework governing AI training and use.
For legal professionals, IP practitioners, and content creators, this decision demands close attention to compliance and licensing when utilizing copyrighted materials in AI research and product development.
More on the ruling and its industry impact can be read in-depth at MLex and coverage at Courthouse News.
By the numbers:
- September 29, 2026 — date of Third Circuit ruling
- 3rd Circuit — first U.S. appellate court to rule on AI training fair use
- ROSS Intelligence — defendant using Westlaw headnotes for AI training