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The New York Times Sues AI Startup Perplexity Over Copyright Infringement

by THEFUTURE.TEAM

December 5, 2025

Legal Showdown in the Digital Age

The New York Times has taken decisive legal action against AI search startup Perplexity, accusing the firm of copyright infringement. The suit, filed on Friday, marks the second legal challenge targeting an AI organization, joining similar efforts led by media powerhouses such as the Chicago Tribune and others.

Unlicensed Content and Commercial Products

The Times contends that Perplexity has exploited its copyrighted content by substituting original material in its commercial offerings—without permission or proper remuneration. According to the legal filing, the startup’s reliance on retrieval-augmented generation (RAG) techniques, which gather and repackage information from websites and databases, results in outputs that closely mirror the original texts.

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Negotiations, Licensing, And Industry Leverage

This litigation emerges amidst ongoing negotiations between media companies and AI firms. While some publishers, including The New York Times, have engaged in licensing agreements—such as the multi-year deal with Amazon—publishers are increasingly using lawsuits as leverage. They aim to force AI companies to enter formal licensing agreements that fairly compensate creators and preserve the economic sustainability of quality journalism.

Countermeasures and Industry Precedents

In response to mounting compensation demands, Perplexity introduced a Publishers’ Program last year. This initiative offers ad revenue sharing to prominent publications like Gannett, TIME, Fortune, and the Los Angeles Times. More recently, the company launched Comet Plus—allocating 80% of its monthly fee to participating publishers—and secured a significant multi-year licensing deal with Getty Images. Despite these measures, critics argue that platforms like Perplexity continue to undermine the value of original, paywalled journalism.

Industry Responses and Historic Battles

Graham James, a spokesperson for The New York Times, asserted, “While we believe in the ethical and responsible use of AI, we firmly object to Perplexity’s unlicensed use of our content. RAG allows Perplexity to crawl the internet and steal content from behind our paywall, which should remain exclusive to our subscribers.” Perplexity’s head of communications, Jesse Dwyer, responded by noting that legal challenges against disruptive technology have a longstanding history, from radio and television to the internet and social media.

Implications For The Future Of Copyright And AI

This lawsuit, following past legal actions against companies such as OpenAI and its backer Microsoft, underscores the escalating tension between traditional publishers and tech innovators. Court decisions—like the recent case against Anthropic for using pirated texts—suggest that the legal framework around fair use and content training may evolve significantly as AI technology pushes boundaries.

A Pivotal Moment In Media And Technology

By holding Perplexity accountable for its commercial practices, The New York Times seeks not only to recoup damages but also to set a precedent that ensures content creators receive due compensation. This legal maneuver is emblematic of a broader strategy by legacy publishers to secure the economic viability of their work in an era increasingly dominated by automated, AI-driven content generation.

The Future Forbes Realty Global Properties

ECB Launches Geopolitical Stress Tests For 110 Eurozone Banks

The European Central Bank is preparing a new round of geopolitical stress tests aimed at assessing potential risks to major financial institutions across the euro area. Up to 110 systemic banks, including institutions in Greece and the Bank of Cyprus, will take part in the exercise, which examines how geopolitical events could affect financial stability.

Timeline And Testing Process

Banks are expected to submit initial data on March 16, 2026. Supervisors will review the information in April, while the final results are scheduled to be published in July 2026. The process forms part of the ECB’s broader supervisory work to evaluate financial system resilience under different risk scenarios.

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Geopolitical Shock As The Primary Concern

The stress tests place particular emphasis on geopolitical risks. These may include armed conflicts, economic sanctions, cyberattacks and energy supply disruptions. Such events can affect banks through changes in market conditions, borrower solvency and sector exposure. Lending portfolios linked to regions or industries affected by geopolitical developments may face higher risk levels.

Reverse Stress Testing: A Tailored Approach

Unlike traditional stress tests that apply the same scenario to all institutions, the reverse stress test requires each bank to define a scenario that could significantly affect its capital position. Banks must identify a geopolitical shock that could reduce their Common Equity Tier 1 (CET1) ratio by at least 300 basis points. Institutions are also expected to assess potential effects on liquidity, funding conditions and broader economic indicators such as GDP and unemployment.

Customized Risk Assessments And Supervisor Collaboration

This methodology allows banks to submit risk assessments based on their own exposures and operational structures. The approach is intended to help supervisors understand how geopolitical events could affect institutions differently and to support discussions between banks and regulators on risk management and contingency planning.

Differentiated Vulnerabilities Across Countries

A joint report by the ECB and the European Systemic Risk Board indicates that countries respond differently to geopolitical shocks. The Russian invasion of Ukraine led to higher energy prices and inflation across Europe, prompting central banks to raise interest rates. Belgium, Italy, the Netherlands, Greece and Austria experienced increases in borrowing costs and lower investor confidence. Germany, France and Portugal recorded more moderate changes, while Spain, Malta, Latvia and Finland showed intermediate levels of exposure.

Conclusion

The geopolitical stress tests will not immediately lead to additional capital requirements for banks. Their results will feed into the Supervisory Review and Evaluation Process (SREP). ECB supervisors may use the findings when assessing capital adequacy, risk management practices and operational resilience at individual institutions.