USA – CALIFORNIA Trends and Developments Contributed by: Rey Barceló, Barceló, Harrison & Walker, LLP
The opinion also included a cautionary passage that has been widely cited in commentary. Even while granting summary judgment to Meta, the court sug - gested, in conclusion, that it is difficult to justify copying books without permission to develop a tool expected to generate massive commercial value while enabling a potentially endless stream of competing works. The decision turned on the evidentiary record before the court rather than on a broad rule approving all AI training practices. For clients, Kadrey’s message is two-sided. Plain - tiffs must build market evidence, particularly for indi - rect substitution and dilution. Defendants must be prepared for that evidence and cannot assume that “transformative” alone will carry the day in a future case with a stronger market record. Kadrey is a pre - view of the next fight, not the last word. What Kadrey means: • market impact is where the next cases will turn, and economic evidence will matter; • courts may not presume a new training data licens - ing market exists; plaintiffs must show the market and the harm; and • a defence win at summary judgment can co-exist with judicial scepticism about the underlying con - duct. Concord Music Group v Anthropic: courts are cautious about broad injunctions The publishers’ lawsuit against Anthropic over song lyrics illustrates another theme: courts may be hesi - tant to grant sweeping preliminary injunctions when requested relief is broad and the record is under - developed. In March 2025, the Northern District of California declined to grant the publishers’ requested preliminary relief, emphasising the overbreadth of the request and the lack of sufficient proof of irreparable harm on that early record. This matters for clients because it signals what kinds of remedies are realistically attainable early. Plaintiffs may find it easier to obtain narrower operational com - mitments, guardrails or preservation orders than to secure a broad “stop training” injunction. Defendants should expect that courts may be sceptical of blanket
relief that effectively regulates an emerging industry before full merits development. Lyon v Adobe: the next wave focuses on data lineage and “supply chain” provenance The proposed class action in Lyon v Adobe (filed 16 December 2025) signalled a broadening of targets and theories. The complaint alleges Adobe used copyrighted books, including pirated books, to train small language models referred to as SlimLM. Public reporting described SlimLM as smaller models aimed at document-related tasks and mobile deployment, illustrating that training disputes are not limited to the largest general-purpose models and can also involve smaller models embedded in products. The case is early, but it highlights a growing focus on training-data lineage. Plaintiffs increasingly allege that companies relied on publicly released datasets mar - keted as open-source, even though those datasets may incorporate text drawn from pirated book col - lections. That approach puts pressure on companies to show what diligence they performed on dataset sourcing and how they documented and audited the data they used, rather than relying on the fact that a dataset was publicly available. For clients, the practical consequence is straight - forward. Data provenance is not just a question of whether the company scraped content directly. It also requires being able to show where third-party training datasets came from, what vetting was done before adopting them, and what controls the company main - tained over their use and retention. The reported USD1.5 billion Anthropic settlement The reported USD1.5 billion settlement in Bartz (report - ed in October 2025 and now proceeding through a court approval process) changed the negotiation pos - ture around AI training disputes. Whatever the ultimate law on training as fair use, the settlement demonstrates that “pirated library” allegations can create existential exposure. Public reporting also emphasised opera - tional components, including destruction of disputed pirated data and certification tied to whether that data was used in commercial products.
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