OpenAI has Little Legal Recourse against DeepSeek, Tech Law Experts Say - mez

OpenAI and the White House have accused DeepSeek of using ChatGPT to cheaply train its brand-new chatbot.
- Experts in tech law state OpenAI has little option under intellectual residential or commercial property and contract law.
- OpenAI's terms of use might use however are largely unenforceable, they say.
This week, bphomesteading.com OpenAI and the White House accused DeepSeek of something akin to theft.

In a flurry of press declarations, higgledy-piggledy.xyz they said the Chinese upstart had bombarded OpenAI's chatbots with inquiries and hoovered up the resulting information trove to rapidly and cheaply train a model that's now nearly as great.

The Trump administration's leading AI czar said this training procedure, called "distilling," totaled up to copyright theft. OpenAI, meanwhile, told Business Insider and other outlets that it's investigating whether "DeepSeek might have inappropriately distilled our designs."

OpenAI is not saying whether the business prepares to pursue legal action, instead assuring what a spokesperson termed "aggressive, proactive countermeasures to safeguard our technology."

But could it? Could it sue DeepSeek on "you stole our material" grounds, similar to the premises OpenAI was itself sued on in a continuous copyright claim submitted in 2023 by The New York City Times and other news outlets?

BI postured this question to specialists in innovation law, who stated difficult DeepSeek in the courts would be an uphill struggle for OpenAI now that the content-appropriation shoe is on the other foot.

OpenAI would have a hard time showing an intellectual residential or commercial property or copyright claim, these legal representatives said.

"The concern is whether ChatGPT outputs" - suggesting the responses it produces in reaction to inquiries - "are copyrightable at all," Mason Kortz of Harvard Law School said.

That's because it's uncertain whether the responses ChatGPT spits out qualify as "imagination," he said.

"There's a doctrine that says creative expression is copyrightable, however truths and concepts are not," Kortz, who teaches at Harvard's Cyberlaw Clinic, said.

"There's a big question in intellectual residential or commercial property law right now about whether the outputs of a generative AI can ever constitute innovative expression or if they are always unguarded truths," he added.

Could OpenAI roll those dice anyhow and declare that its outputs are safeguarded?

That's not likely, the attorneys stated.

OpenAI is already on the record in The New york city Times' copyright case arguing that training AI is an allowed "reasonable use" to copyright protection.

If they do a 180 and inform DeepSeek that training is not a reasonable use, "that may return to sort of bite them," Kortz stated. "DeepSeek could state, 'Hey, weren't you just saying that training is reasonable use?'"

There may be a distinction in between the Times and DeepSeek cases, Kortz added.

"Maybe it's more transformative to turn news short articles into a model" - as the Times implicates OpenAI of doing - "than it is to turn outputs of a design into another design," as DeepSeek is stated to have done, Kortz said.

"But this still puts OpenAI in a quite predicament with regard to the line it's been toeing relating to reasonable usage," he added.

A breach-of-contract claim is most likely

A breach-of-contract suit is much likelier than an IP-based claim, though it includes its own set of issues, stated Anupam Chander, who teaches technology law at Georgetown University.

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The regards to service for Big Tech chatbots like those developed by OpenAI and Anthropic forbid using their material as training fodder for a competing AI design.

"So maybe that's the suit you might possibly bring - a contract-based claim, not an IP-based claim," Chander stated.

"Not, 'You copied something from me,' but that you took advantage of my model to do something that you were not allowed to do under our agreement."

There might be a drawback, Chander and Kortz stated. OpenAI's terms of service need that a lot of claims be solved through arbitration, not lawsuits. There's an exception for suits "to stop unauthorized usage or abuse of the Services or intellectual home violation or misappropriation."

There's a bigger drawback, though, specialists said.

"You need to understand that the brilliant scholar Mark Lemley and a coauthor argue that AI regards to use are likely unenforceable," Chander said. He was referring to a January 10 paper, "The Mirage of Artificial Intelligence Regards To Use Restrictions," by Stanford Law's Mark A. Lemley and Peter Henderson of Princeton University's Center for Information Technology Policy.

To date, "no model developer has in fact attempted to enforce these terms with monetary charges or injunctive relief," the paper states.

"This is likely for excellent factor: we think that the legal enforceability of these licenses is doubtful," it adds. That remains in part since design outputs "are largely not copyrightable" and because laws like the Digital Millennium Copyright Act and the Computer Fraud and Abuse Act "offer limited recourse," it says.

"I believe they are likely unenforceable," Lemley told BI of OpenAI's terms of service, "because DeepSeek didn't take anything copyrighted by OpenAI and since courts normally will not implement contracts not to complete in the absence of an IP right that would avoid that competitors."

Lawsuits between celebrations in different nations, each with its own legal and enforcement systems, are always challenging, Kortz said.

Even if OpenAI cleared all the above obstacles and won a judgment from an US court or arbitrator, "in order to get DeepSeek to turn over cash or stop doing what it's doing, the enforcement would come down to the Chinese legal system," he said.

Here, OpenAI would be at the mercy of another exceptionally complex area of law - the enforcement of foreign judgments and the balancing of individual and corporate rights and nationwide sovereignty - that extends back to before the founding of the US.

"So this is, a long, complicated, fraught procedure," Kortz added.

Could OpenAI have safeguarded itself much better from a distilling attack?

"They could have utilized technical measures to block repetitive access to their site," Lemley stated. "But doing so would also interfere with normal customers."

He included: "I don't believe they could, or should, have a legitimate legal claim versus the searching of uncopyrightable details from a public site."

Representatives for DeepSeek did not immediately respond to a request for remark.

"We know that groups in the PRC are actively working to utilize techniques, including what's called distillation, to try to duplicate sophisticated U.S. AI models," Rhianna Donaldson, an OpenAI spokesperson, told BI in an emailed statement.