AI startup Anthropic agrees to pay $1.5 billion to authors, largest copyright infringement settlement ever

Anthropic has struck a $1.5 billion deal to end a high-stakes copyright fight with a group of authors who accused the AI startup of training its models on pirated books, according to a report from CNBC. The agreement, if approved, would mark the largest copyright settlement ever recorded.

The ruling comes just a day after Anthropic raised $13 billion in funding at a $183 billion valuation, tripling its worth in only six months.

The terms lay it out clearly: roughly $3,000 per book plus interest, alongside an order to destroy the datasets that held the disputed material. The case has been closely tracked across publishing and tech circles, seen as a litmus test for how courts define copyright infringement in the age of AI.

“This settlement sends a powerful message to AI companies and creators alike that taking copyrighted works from these pirate websites is wrong,” Justin Nelson, the attorney for the plaintiffs, told CNBC.

Inside Anthropic’s $1.5 Billion Author Copyright Infringement Settlement Over AI Training

The lawsuit, filed last year in the Northern District of California by authors Andrea Bartz, Charles Graeber, and Kirk Wallace Johnson, accused Anthropic of “large-scale copyright infringement by downloading and commercially exploiting books that it obtained from allegedly pirated datasets.” The authors pointed to databases like Library Genesis and Pirate Library Mirror as the sources of their stolen work.

In June, a judge offered a partial ruling, saying Anthropic’s use of books to train AI models could qualify as “fair use.” Still, the company was set to face trial in December over whether its sourcing from pirate libraries crossed the line into copyright infringement. That trial is now off the calendar if the settlement goes through.

The outcome reverberates far beyond the plaintiffs. For AI startups and media companies alike, the case underscores the stakes of building products on data that might not be legally licensed. Copyright questions have been hanging over the industry for years, but the sheer scale of this settlement is likely to reset the conversation.

The timing is striking. Just days before news of the settlement, Anthropic closed a $13 billion funding round led by Iconiq, Fidelity Management, and Lightspeed Venture Partners, pushing its valuation to $183 billion. That means one of the fastest-growing startups in the sector will be writing a record-breaking check to authors while continuing its race for dominance in AI.

Founded in 2021 by Dario Amodei, Daniela Amodei, Jack Clark, Sam McCandlish, and Tom Brown, Anthropic was built with a focus on building AI that is “steerable, interpretable, and robust.” Before co-founding the company, Daniela Amodei served as OpenAI’s VP of safety and policy.