Reddit, Inc. v. Anthropic PBC

In suit brought by Reddit against Anthropic for alleged unauthorized scraping of users’ content to train AI chatbot, district court remands action to state court, holding that Copyright Act does not preempt Reddit’s state-law claims.

Social media forum Reddit Inc. filed suit against Anthropic PBC in California state court, alleging that Anthropic scraped user content from its platform without authorization and used the content to train the large language models (LLMs) for its AI chatbot Claude. Reddit alleged five causes of action under California law: (1) breach of contract, (2) unjust enrichment, (3) trespass to chattels, (4) tortious interference with contract and (5) unfair competition under California Business & Professions Code Sec. 17200.

Anthropic removed the suit to federal court, asserting that the federal Copyright Act preempted each of Reddit’s causes of action and therefore the federal court had federal-question jurisdiction. Reddit moved to remand the case to state court, arguing that the Copyright Act did not preempt any of Reddit’s causes of action and the federal court lacked federal-question jurisdiction.

The court held that the Copyright Act did not preempt Reddit’s state-law causes of action. Section 301 of the Copyright Act preempts state-law claims only if “(1) the work at issue comes within the subject matter of copyright, and (2) the state law rights are equivalent to any of the exclusive rights within the general scope of copyright.”

The court concluded that Reddit’s content falls within the subject matter of copyright because it “essentially serves as a repository of natural human language discussion in website format.” Such content is original expression with “copyright protection features.”

The court also concluded, however, that Reddit’s state-law causes of action were not equivalent to any of the exclusive rights within the general scope of copyright. With respect to breach of contract, the court found that Anthropic and Reddit were contractually bound by Reddit’s user agreement and the user agreement imposed duties and obligations “quantitatively different” from those under the Copyright Act. Specifically, the court pointed to the user agreement’s restrictions on particular “methods of access” and “safeguards [Reddit’s] services by prohibiting conduct that impairs its technical infrastructure.” Accordingly the court held that Reddit’s claim for breach of the user agreement contained “extra elements” beyond a claim under the Copyright Act.

The court also found the claim for unjust enrichment not to be equivalent to a claim for copyright infringement in light of the allegations of bypassing of certain technical safeguards. The claim for trespass to chattels was not preempted for the same reasons.

With respect to tortious interference, the court noted that Reddit alleged a contractual relationship between it and its users that included obligations to protect user privacy. Reddit’s claims that Anthropic had bypassed technical measures designed to safeguard privacy presented the necessary “extra element” for the court to find no preemption.

Finally, the court found that the Copyright Act did not preempt Reddit’s claim under the California Business and Professions Code. It noted that a claim under the California Business and Professions Code has three prongs, prohibiting any “unlawful, unfair, or fraudulent business practice or act.” The alleged trespass to chattels and tortious interference claims satisfied the unlawful prong, and Reddit’s claim that Anthropic misappropriated Reddit’s content was sufficient to allege an unfair advantage. With respect to the fraudulent business practice prong, Reddit alleged that Anthropic had publicly claimed that it honors “directives in robots.txt” while ignoring those directives while scraping Reddit’s platform. As the court found that all three prongs required Reddit to prove “extra elements” that are “qualitatively different from the rights covered by the Copyright Act,” the claim was not preempted.

Summary prepared by Todd Densen and Keane Barger