The Third Circuit finds that AI companies can’t use material with an original “creative spark.”
Last week the Court of Appeals for the Third Circuit, which oversees the districts of Delaware, New Jersey, Pennsylvania, and the Virgin Islands, upheld and further underlined a lower court ruling in the ongoing AI and copyright case of Thomson
In a recent decision by the Third Circuit Court of Appeals, it was determined that AI companies cannot utilize material with an original "creative spark" without violating copyright law. This ruling, which supports a previous lower court decision in the Thomson Reuters v. ROSS Intelligence case, emphasizes that materials significantly altered with a creative touch can be protected by copyright, prohibiting AI from using them to develop competing businesses.
The case began when Thompson Reuters accused ROSS Intelligence of copyright infringement by using headnotes (summaries of legal issues) from Reuters's legal research platform, Westlaw, to create a competing product. In 2025, a judge ruled that Westlaw's headnotes had a "creative spark," making them original works under copyright law. Although ROSS claimed fair use, the court found that their use was "minimally transformative at best" and served to compete with Westlaw.
Judge Tamika Montgomery-Reeves affirmed this ruling, stating that while Westlaw initially drew on non-copyrightable judicial opinions, the arrangement and curation of their headnotes warranted protection under copyright law. This decision raises concerns about the implications for AI companies, as it could restrict their ability to harvest data and transform works into original content.
However, the ruling primarily impacts non-generative AI models, potentially allowing major AI players like Google, Meta, or Palantir to continue their operations with fewer restrictions.
The ruling also blurs the line between fact and expression, expanding copyright enforcement to intermediate copies and creating new opportunities for AI training data markets. While the decision may provide some constraints for AI companies, it is unlikely to significantly hinder larger corporations. The case highlights the ongoing struggle to define and protect the "spark of creativity" in AI-generated content, emphasizing the need for a balance between innovation and legal boundaries.
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