Legal Turning Point in AI and Copyright: Insights from the UK Court's Ruling on Gaps in Protection

The ruling by the High Court of the United Kingdom has highlighted significant challenges in intellectual property protection in the digital age. In the lawsuit brought by Getty Images against Stability AI, the court acknowledged trademark infringement but ruled that there was no copyright infringement.

Details of the ruling and legal assessment

Judge Joanna Smith recognized that the Stable Diffusion model reproduced Getty’s watermark in a specific case, confirming trademark infringement. However, the judge pointed out that the scope of this infringement was “very limited.”

More importantly, the court determined that a “primary infringement” by Stability AI did not occur. This was because Getty Images failed to prove infringement by UK users. Additionally, the claim of “secondary infringement” was dismissed on the grounds that the AI model did not actually store or reproduce images.

From the perspective of the 1988 UK Copyright, Designs and Patents Act (CDPA), models like Stable Diffusion do not reproduce copyrighted works, and therefore do not constitute “infringing copies.” As a result, violations of Sections 22 and 23 of the CDPA were ruled out.

International legal trends

This ruling aligns with U.S. case law. In October 2023, Judge William Orick dismissed most copyright infringement claims in a case against Midjourney, DeviantArt, and Stability AI. Judge Orick’s reasoning was similar: images generated by AI do not sufficiently resemble the original works used for training, and thus do not constitute copyright infringement.

These rulings reveal the current legal framework’s inadequacy in providing comprehensive protection for AI training and usage.

The rise of solutions through Web3 and NFTs

To fill the legal gaps for content creators and artists, several blockchain companies and Web3 projects are adopting new approaches. They are developing solutions to trace data origins and protect intellectual property rights.

At the core are non-fungible tokens (NFTs). NFTs record the original ownership rights of various creative works such as art, essays, books, and music production, and automatically distribute royalties. Blockchain technology enables verification of the source of copyrighted materials and maintains transparent usage histories.

Thus, in response to the intellectual property issues of the AI era—problems that traditional legal frameworks struggle to address—decentralized protection mechanisms utilizing NFTs are emerging as practical solutions. Blockchain and NFTs are evolving from mere speculative assets into foundational tools for establishing ownership in the digital economy.