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Anthropic has agreed to pay US $1.5 billion to settle a class-action lawsuit filed by several authors who alleged the company illegally downloaded and stored pirated copies of their books to train its AI chatbot Claude. A federal court filing has been submitted to U. S. District Judge William Alsup in San Francisco, who is scheduled to review the agreement. If approved, the payout will likely represent the largest copyright recovery in U. S. history. Payment to authors is estimated at around $3,000 per affected work, covering approximately 500,000 books. In addition, Anthropic has agreed to destroy the pirated dataset. The settlement marks a pivotal moment in the escalating legal debate over generative AI companies and their use of copyrighted content.

Anthropic's $1.5 billion settlement with authors reflects both strategic legal calculation and mounting pressure from creative professionals. The lawsuit, filed by authors Andrea Bartz, Charles Graeber, and Kirk Wallace Johnson, centred on Anthropic's early dataset, which included over seven million pirated books obtained from shadow libraries such as LibGen and Pirate Library Mirror. Although a June ruling concluded that training AI models on legitimately acquired books could constitute fair use, the judge found the acquisition of pirated content unlawful, exposing the company to potentially crippling damages that could have reached into the hundreds of billions or even more.

According to the settlement terms, authors will receive approximately $3,000 per work for about 500,000 books-after removing duplicates and non-copyrighted material-though the fund may expand if more affected works are identified. Anthropic has also agreed to destroy the pirated files, resolving the“legacy claims” stemming from the unauthorised content.

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Legal experts view the deal as a landmark resolution, one that could reshape how AI developers engage with creative industries. It establishes a financial precedent that may encourage more licensing arrangements between tech firms and authors, and provides a model for avoiding potentially ruinous litigation. This settlement may similarly influence parallel cases involving major players like OpenAI, Microsoft, Meta, and others.

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