Legal & Ethical Analysis: Issue 2°

Key Points

1. On June 4, 2025, Reddit filed a Complaint against Anthropic in the Superior Court of the State of California in San Francisco

   
   

2. This Complaint follows the one against Anthropic launched by the major music publishers commenced in October 18, 2023, which was ultimately settled

   
   

3. The Complaint by the music publishers was about copyright law, and the Reddit Complaint was about violating the User Agreement and the privacy of Reddit users. It will be interesting to see how the Reddit Complaint is resolved

On June 4, 2025, Reddit filed a Complaint against Anthropic in the Superior Court of the State of California in San Francisco. This is not the first Complaint that has been commenced against Anthropic—we cannot forget what recently took place when the music publishers sued Anthropic for copyright infringement.

What is the claim about? What does Reddit want? How is this claim different than the one against Anthropic that was launched by the music publishers? What can we take from this development? This article answers these questions.

What is Reddit Claiming?

Essentially, Reddit has stated that although Anthropic claims it is the “white knight of the AI industry” that prioritizes honesty and high trust, it is “anything but” and it uses empty marketing gimmicks.

Reddit asserts in its Complaint that it has a User Agreement that contains the following excerpts of sections 3 and 7:

“3.Your Use of the Services

Except and solely to the extent such a restriction is impermissible under applicable law, you may not, without our written agreement:

license, sell, transfer, assign, distribute, host, or otherwise commercially exploit the Services or Content”

“7.Things You Cannot Do

Access, search, or collect data from the Services by any means (automated or otherwise) except as permitted in these Terms or in a separate agreement with Reddit (we conditionally grant permission to crawl the Services in accordance with the parameters set forth in our robots.txt file, but scraping the Services without Reddit’s prior written consent is prohibited)”

Even though Reddit has this provision, it claims that Anthropic has intentionally trained on the personal data of Reddit users without ever requesting their consent. In fact, it claims that Anthropic has been ignoring the provision and has had bots repeatedly hit Reddit’s servers over 100,000 times notwithstanding the statements of Reddit’s CEO that Anthropic has unlawfully exploited Reddit content. Further, Reddit states that Anthropic has refused to respect Reddit users’ privacy rights—contrary to Anthropic’s own values. By training its model, Claude, on Reddit’s posts without authorization, Reddit claims that it is in direct violation of Reddit’s User Agreement.

In a nutshell, Reddit says that Anthropic has scraped and used Reddit content in its commercial offerings—Claude even provides output statements confirming that it has been trained on Reddit. Anthropic refused to respect Reddit’s guardrails and enter into a lisensing agreement like Google and OpenAI has. Reddit asserts that instead, Anthropic continued to commercialize Reddit content without authorization.

Interestingly, Reddit states that Anthropic has admitted that it scrapes Reddit content, but it has provided several excuses—all of which are unacceptable.

To that end, Reddit is advancing the following claims against Anthropic:

• Breach of Contract: Anthropic has violated Reddit’s User Agreement by acting contrary to sections 3 and 7 of the Agreement

• Unjust Enrichment: Anthropic was unjustly enriched at the expense of Reddit when it scraped and used Reddit content to train and power a model to the tune of billions of dollars

  
  

• Trespass to Chattels: Anthropic intentionally entered into, and made use of, Reddit’s platform and technological infrastructure, including its software and servers, to access and obtain Reddit content and information for its own economic benefit

  
  

• Tortious Interference With Contract: Anthropic intentionally interfered with Reddit’s contractual relationships with its users by: scraping Reddit content without entering into a licensing agreement that would provide the necessary guardrails to protect users’ privacy rights; bypassing connecting to Reddit’s Compliance API, which automatically notifies licensees when users delete posts or comments; training its AI models on user content without any mechanism to respect Reddit user deletion requests; and continuing to scrape Reddit content after being notified that such conduct violated Reddit’s obligations to its users. This intentional interference diminished Reddit’s capacity to fulfill its obligations to its users

  
  

• Unfair Competition: Anthropic has engaged in acts of unfair competition, including unlawful, unfair, and/or fraudulent business acts and practices as defined by the Business and Professions Code. Anthropic has trespassed on Reddit’s platform and taken possession of Reddit content and data without authority or permission, and interfered with Reddit’s contractual relationships with Reddit’s users. Anthropic has also engaged in fraudulent business practices by falsely stating that it was no longer scraping the Reddit platform, even as Anthropic continued to scrape to acquire and use Reddit content to train its AI models for commercial gain

In addition, Reddit has requested a jury trial.

What is Reddit Asking for in the Complaint?

Reddit is asked for the following:

• Specific Performance, compensatory damages, consequential damages, lost profits, and/or disgorgement of Anthropic’s profits

  
  

• An injunction

  
  

• Restitution for the amount by which Anthropic has been enriched by its scraping and use of Reddit content

  
  

• Pre-judgment and post-judgment interest

  
  

• Punitive damages

  
  

• Fees, costs, and any other appropriate relief

Another Previous Complaint by Music Publishers

We cannot forget that on October 18, 2023, several major music publishers (Music Publishers) filed a Complaint against Anthropic in the United States District Court for the Middle District of Tennessee Nashville Division.

Essentially, the Music Publishers brought the action to address the systematic and widespread infringement of their copyrighted song lyrics by Anthropic. That is, they asserted that Anthropic unlawfully copied and disseminated vast amounts of copyrighted works—including the lyrics to myriad musical compositions owned or controlled by the Music Publishers. In the very first paragraph, the Music Publishers stated:

“(Music) Publishers embrace innovation and recognize the great promise of AI when used ethically and responsibly. But Anthropic violates these principles on a systematic and widespread basis. Anthropic must abide by well-established copyright laws, just as countless other technology companies regularly do”

The Music Publishers explained that they partnered with innovators, including entrepreneurs, start-ups, and established companies—they recognized and drove true innovation (for instance, Universal used AI in its business and production operations). However, Anthropic’s copyright infringement did not constitute innovation: “in layman’s terms, it’s theft”.

In fact, the Music Publishers claimed that Anthropic violated the United States Copyright Act. They acknowledged that AI was a new technology, but they insisted that AI companies still had to follow the law. Technological advances could not come at the expense of the creators who essentially served as the backbone for AI’s development.

Anthropic built AI models by scraping and ingesting massive amounts of text from the internet (and potentially other sources), using all of it to train its AI models (Claude 2 in this case) and generate output based on this copied text. The Music Publishers claimed that Anthropic copied the data to fuel its AI models lyrics to their musical compositions. They urged that copyrighted material was not free just because it could be found on the internet—in this case, Anthropic never asked for permission.

Notwithstanding Anthropic’s company Constitution (the goal was to be harmless, respectful, and ethical), the Music Publishers passionately argued that Anthropic committed copyright infringement since it generated identical or nearly identical copies of their lyrics. In the Complaint, the Music Publishers provided examples where famous songs were either completely or partially outputted in the response to user prompts.

In fact, the Music Publishers argued that:

• Anthropic directly infringed the Music Publishers’ exclusive rights as copyright holders, including the rights of reproduction, preparation of derivative works, distribution, and public display

  
  

• Anthropic unlawfully enabled, encouraged, and profited from massive copyright infringement by its users, so it was secondarily liable for the infringing acts of its users under well-established theories of contributory infringement and vicarious infringement

  
  

• Anthropic’s AI output often omitted critical copyright management information regarding these works, making it so that the composers of the song lyrics frequently did not get recognition for being the creators of the works that were being distributed

The Music Publishers stated, “It is unfathomable for Anthropic to treat itself as exempt from the ethical and legal rules it purports to embrace”. According to the Music Publishers, there was no doubt that Anthropic profited from the infringement of the Music Publishers’ repertoires, since Anthropic was already valued at $5 billion, received billions of dollars in funding, and boasted about numerous high-profile commercial customers and partnerships. The Music Publishers stated in the Claim:

“None of that would be possible without the vast troves of copyrighted material that Anthropic scrapes from the internet and exploits as the input and output for its AI models”

The Music Publishers noted that nothing about Anthropic was creative—Anthropic depended on the creativity of others and paid them nothing. This caused substantial and irreparable harm.

The Claim set out how Anthropic trained the data:

• copied massive amounts of text from the internet (and potentially other sources), by “scraping” (or copying or downloading) the text directly from websites and other digital sources onto Anthropic’s servers, using automated tools, such as bots and web crawlers, and/or by working from collections prepared by third parties

  
  

• cleaned the copied text to remove material that it perceived as inconsistent with its business model, whether technical or subjective in nature (such as deduplication or removal of offensive language)

  
  

• copied the massive “corpus” and processed it in multiple ways to train the Claude AI models (encoding the text into tokens)

  
  

• processed the data further to finetune the Claude AI model and engaged in additional reinforcement learning, based both on human feedback and AI feedback, all of which may require additional copying of the collected text

The following are Claims for Relief:

• Count I: Direct Copyright Infringement

  
  

• Count II: Contributory Infringement

  
  

• Count III: Vicarious Infringement

  
  

• Count IV: Removal or Alteration of Copyright Management Information

To that end, the Music Publishers requested relief against Anthropic in the form of Judgement on each of the claims above, an order for equitable relief, an order requiring Anthropic to pay the Music Publishers statutory damages, an order requiring Anthropic to provide an accounting of the training data and methods (and the lyrics on which it trained AI models), an order to destroy (under Court supervision) all infringing copies of the Music Publishers’ copyrighted works, costs, and interest.

On October 23, 2023, Anthropic initially stated that training its AI models constituted “fair use”, meaning that it was a lawful exemption in copyright law. Why? Because Anthropic was engaging in a use that was highly transformative. Indeed, the company mentioned that it did not intend to violate the law.

Furthermore, on November 16, 2023, the Music Publishers brought a Motion asking Anthropic to stop using their music lyrics, asking for a preliminary injunction.

However, by January 6, 2025, it was reported that Anthropic and the Music Publishers reached a settlement where Anthropic would implement robust measures to ensure compliance with the law, namely revising its data collection and training methodologies to exclude copyrighted content, unless proper licenses or permissions have been obtained. Also, it agreed to have more stringent oversight on its data sources to mitigate the risks of inadvertently using protected material in future AI training.

What Can We Take from This Development?

Following the debacle with the Music Publishers, one would think that Anthropic would be striving to promote ethical AI practices and foster trust with both the creators of artistic works and the wider public. One would think that Anthropic learned its expensive lesson.

But now, Anthropic has to face Reddit.

The disappointing part of the story is that Anthropic similarly scraped Reddit content from the internet and used it to train Claude models—clearly without permission and without entering into a proper licensing agreement.

While this is technically not a copyright infringement case, it is similar in that the User Agreement was allegedly breached because there were terms that Anthropic needed to comply with, but instead it appeared to have violated them.

In particular, to use Reddit, the terms in clauses 3 and 7 had to be complied with. And Anthropic was warned—but Anthropic continued to hit Reddit’s servers and scrape away so that Anthropic could train Claude (without paying).

This appears to be the first time that a big tech company has challenged an AI model provider over its training data practices, and it will be interesting to see what happens. As with the case with the Music Publishers, Anthropic will likely have to settle and promise not to do this again. This may be what the company has to ultimately do in order to preserve the delicate balance between innovation and the rights of companies like Reddit (along with its users). For a company that was just valued at 61.5 billion (up from 5 billion noted in the Complaint a couple of years ago), it may be something that Anthropic needs to do sooner rather than later in order to preserve its reputation.

Anthropic spoke with TechCrunch recently and said that it disagreed with Reddit and would vigorously defend itself. We shall see what happens in the coming months…