Disney and Universal Studios filed the first major Hollywood lawsuit against an AI company, accusing image generator Midjourney of "blatant theft" and seeking up to $150,000 per infringed character in damages that could exceed $20 million.
The 143-page federal complaint alleges Midjourney functions as a "virtual vending machine, generating endless unauthorized copies" of copyrighted characters including Mickey Mouse, Darth Vader, Shrek, Homer Simpson, and Marvel superheroes. The lawsuit marks Hollywood's first direct legal challenge to the AI industry.
"Piracy is piracy, and the fact that it's done by an AI company does not make it any less infringing," declared Disney's chief legal officer Horacio Gutierrez.
The studios claim Midjourney, which generated $300 million in revenue last year with 21 million users, easily produces copyrighted characters when prompted by subscribers. Despite Disney's cease-and-desist letter in December 2024, the companies allege Midjourney ignored their requests to implement blocking technology.
The lawsuit challenges the AI industry's fundamental assumption that training on copyrighted materials constitutes fair use. Legal experts suggest the case could force AI companies to either pay licensing fees or completely retrain their models using only authorized content.
The Motion Picture Association backed the lawsuit, calling copyright protection "the backbone of our industry." Similar lawsuits against AI companies have been filed by newspapers, record labels, and individual artists across multiple industries.
This landmark case will likely determine whether AI companies can continue training models on copyrighted material or must negotiate licensing agreements with content creators. The outcome could reshape both the AI industry and Hollywood's approach to emerging technology partnerships.