(DETROIT) — A labor strike against the three largest motor vehicle manufacturers in the United States is expected to be expanded further on Friday amid ongoing contract negotiations.
If no deal is reached overnight, United Auto Workers President Shawn Fain will deliver remarks at 10 a.m. ET announcing new targets to strike, which will begin at noon.
A source close to the union spoke to ABC News on Thursday afternoon, describing the negotiations as being very active within the last 24 hours and having in-person, sit-down meetings with representatives from both sides, including Fain.
The UAW, which represents nearly 150,000 American autoworkers, launched a strike against General Motors, Ford and Stellantis — often called the “big three” — on Sept. 15. Almost 13,000 workers walked out of three auto plants in Michigan, Missouri and Ohio that day. The union is utilizing a “stand-up” strike method to target specific plants and add to the list if a deal isn’t reached.
After the unprecedented strike began, Ford laid off 600 workers who assemble cars at a plant in Michigan on Sept. 15. Workers in the paint department at a nearby plant are out on strike, leaving the assembly workers without adequate parts since the parts require paint before they can be put together into cars, a company spokesperson told ABC News.
On Sept. 22, Fain announced 38 new strike locations targeting GM and Stellantis, saying all parts distribution locations for the two companies at cities across 20 U.S. states will now join the walkouts. Ford was excluded at the time due to substantial progress at the bargaining table. Approximately 5,625 additional UAW members joined the picket line that day, bringing the overall total to more than 18,000.
It was unknown how many more targets would be picked for Friday, as the strike nears its fourth week. But it was clear that all three Detroit-based companies would be potential options if there was no progress.
Sticking points in negotiations were wage increases and the length of the workweek. The union is demanding a 46% pay increase combined over the four-year duration of a new contract, as well as a 32-hour workweek at 40-hour pay. So far, GM, Ford and Stellantis have each put forward proposals that offered workers a 20% pay increase over the life of the agreement but preserved a 40-hour workweek.
Economists have warned that while the U.S. has yet to see any massive effects on its economy, a prolonged strike lasting a month or more could damage the country’s GDP and increase the chances of heading into a recession. Economists previously told ABC News that a strike could result in billions of dollars in losses, disruption to the supply chain and other financial consequences.
On Thursday, Fain accused GM and Stellantis of enabling violence against striking workers, pointing to incidents that occurred in Michigan, Massachusetts and California. Both companies denied the allegations and cited an escalation in behavior on the picket line.
President Joe Biden has deployed acting Labor Secretary Julie Su and White House senior adviser Gene Sperling to Detroit to offer their support for the parties in reaching an agreement. Biden himself traveled to Michigan this week to join the picket line “and stand in solidarity with the men and women of UAW as they fight for a fair share of the value they helped create.”
(NEW YORK) — In the first week of October, Kennedy Quintanilla will do something she has not had to do since graduating from college two years ago: make a student loan payment.
“Reality is setting in,” Quintanilla, a 2021 graduate of the University of Texas at Austin with over $26,000 in student loan debt, told Good Morning America. “It’s extraordinary stressful.”
As someone who graduated college amid the coronavirus pandemic, Quintanilla, 24, will be one of thousands of borrowers making their first-ever student loan payment in October, when payments resume after a three-year pause.
The first-time payments are particularly impacting members of Gen Z, like Quintanilla, who were born after 1996 and who are on track to be the best-educated generation in American history, according to The Pew Research Center.
They are a generation who entered college at a time when tuition rates were at record-highs, and who graduated at a time of economic uncertainty due, in part, to the coronavirus pandemic.
As of this year, nearly seven million borrowers ages 24 and younger owe more than $97 billion in federal student loans, according to government data.
It’s a staggering number that has left many members of the Gen Z generation “disenfranchised,” according to Vivian Tu, a personal finance expert with over two million followers on TikTok, at @Your.RichBFF.
“They’ve never seen an economic system really work,” Tu, author of the forthcoming book “Rich AF,” told GMA of Gen Zers. “Boomers/Gen X could get degrees for relatively little money, get good jobs where families could live comfortably off of one income, and they got to have the 2.5 kids, golden retriever, white picket fence/house with a tire swing dream. But then Millennials did all the right things but lived through significantly more financial hardship such as stagnating wages, 10 times in the price of education, three times in the price of housing, and the housing crisis.”
She continued, “Gen Z is now seeing these two to three generations before them, and are really starting to feel like higher education may no longer be ‘worth it,’ not to mention, graduating into the pandemic likely having not ever made a student loan payment and demonstrating a really different values system than the ones seen in generations before them.”
In June, Gen Z borrowers were dealt another blow when the Supreme Court overturned President Joe Biden’s loan-forgiveness plan that would have canceled $10,000 in student debt for all borrowers who made less than $125,000, and up to $20,000 for borrowers who also received Pell grants.
Had Biden’s plan gone into effect, Quintanilla, who works full-time, said $20,000 of her student loan debt would have been forgiven.
“Pretty much all of my friends had to take out loans in order to be in school,” she said. “We operated the first two years of adulthood, out of college, free from [payments] … Now that most of us are pretty established in our careers, we’re having to go back and evaluate because it’s not like it used to be.”
Erin Confortini, who provides financial advice to Gen Zers on TikTok, said that for this generation in particular, starting monthly student loan payments after a three-year pause is causing financial fallout.
“I think people have been, for the past couple of years, creating their budget under the expectation that they’re not going to have these student loan payments,” Confortini, who herself graduated from college in 2021 with $38,000 in student loan debt, said. “They have things like rent, a car payment, those big fixed expenses that they’ve already locked themselves into, and now they need to also factor a big fixed expense in a student loan payment that they don’t have budget for.”
In Quintanilla’s case, she said she planned ahead and chose an apartment about 20 minutes outside of Austin, where rent is cheaper, so she could save money to pay off her loan. She said she is also finding other ways to cut back on spending — including possibly forgoing a secondary degree — to account for the monthly payments she will now be making for an estimated 10 to 15 years.
“I know a lot of people, myself included, who thought maybe secondary education was going to be the path we took,” she said. “And we have definitely steered clear from that because of this whole situation.”
Kids, parents paying off student loans at the same time
The burden of student loan debt a person carries can affect not just whether they continue their education, but everything from where they live and what job they can take to how many kids they have and whether they can purchase a home and build generational wealth, experts say.
And for many members of Gen Z, those types of choices are a reality they are now facing after watching their parents face them too.
Alex Espinoza Acosta, a 2022 graduate of the University of Texas at Austin, said he is facing $25,000 in student loan debt at the same time as his mom, who graduated college while he was in high school, continues to pay off her remaining $50,000 in student loan debt.
After graduating college, Acosta moved back home to San Antonio to help his family and save money. He said though he knows student loan payments are resuming, he has not yet paid attention to when his first payment is due because he does not have the money.
“With the work I’ve gotten, I can barely make ends meet now,” Acosta, who majored in government and international relations, told GMA. “I got a bartending job to prepare myself for the payments [resuming]. I’ve been trying to find full-time work, but just haven’t been successful.”
He added of his job search, “I’ve had so many interviews and just haven’t landed anything yet.”
Like many others who were college students when the pandemic struck, Acosta said he lived at home his junior year and took classes remotely, while paying the same tuition. Now, as he and his peers try to start their lives post-college, what they are all talking about, he said, is debt.
“My friends, most of them have higher debt and are even more worried,” Acosta said. “A lot of my friends are helping their families because it’s hard for them to make ends meet with rising everything … They’re worried about rent, car payments, car insurance, inflation.”
And with Gen Zers more likely to hold student debt than previous generations, the trajectory is continuing for who is the most impacted, people of color, and particularly, Black women.
Overall, women hold nearly two-thirds of the nearly $2 trillion outstanding student debt in the U.S., and Black women are the most likely of any gender group to have student loans, with around 1 in 4 Black women holding student debt, according to data from the U.S. Census Bureau and the American Association of University Women.
It’s a concern for Megan Kane, a 23-year-old Black woman who said she is also still watching her parents, who are in their 50s, pay off their student loan debts too.
Kane, a 2022 graduate of Georgetown University, said she will begin paying off her $28,000 in student loan debt at the end of October, a monthly payment that she estimates she’ll continue to pay until at least 2038.
“In the immediate future, it’s less eating out, careful budgeting and taking very careful track of where my money is going so my payments don’t go into default,” Kane, who now lives and works full-time in Oakland, California, told GMA. “And then in the long-term future, I just really don’t know if I’m ever going to be able to buy a home or what kind of other financial goals I’m going to have to sacrifice for this.”
Kane, a foreign service major, added that those sacrifices could include her future education, saying, “I’ve been studying for the GRE and really hope to go back and get a graduate degree, but I don’t know if that will be a possibility for me because I really can’t afford to take on any more student debt.”
Experts’ tips for first-time, Gen Z borrowers
Kane, Acosta and Quintanilla all noted that when they signed up to take on what ended up being tens of thousands of dollars of debt, they were 17 and 18-year-olds unsure of what student loans really meant or how they would impact their futures.
As they prepare to make their first student loan payments, all three said it is equally confusing trying to figure out how to pay back what they described as an “overwhelming” amount of money.
“There’s so many things that … I think even peers my age now don’t really understand or have a full grasp on,” Quintanilla said. “Things like public service loan forgiveness, income-based repayment, those are all very inaccessible to understand but make a tremendous difference if you operate the system correctly.”
The overwhelm of the amount of money combined with frustration that the higher education and student loan industries have not evolved to better suit students led to some borrowers, especially on social media, to call for a “student debt strike.”
Financial experts though like Confortini and Tu say that though they understand the frustration, the reality of ignoring student loan payments is not something people would want to face.
“I think that speaks to the lack of financial literacy that a lot of our generation does have,” Confortini said. “If you’re saying something like that and being serious, you probably don’t understand things like how credit scores work. You can’t just not pay your debt.”
Similarly, Tu’s top advice for Gen Z borrowers is to “not bury your head in the sand.”
“I get that student loan debt can feel so overwhelming, but whether you’re making the minimum payment or trying to pay your debt off ASAP, just make a plan,” she said. “You’ll feel so much better once you have a roadmap of how you plan on tackling your debt.”
Jaylon Herbin, student loan lead for the Center for Responsible Lending, a nonprofit financial policy organization, said a first step for borrowers is to locate their loan servicer since many servicers have changed over the past three years. Borrowers can check by logging on to studentaid.gov.
From there, according to Herbin, each borrower has to figure out the best repayment plan for them since it’s not a one-size-fits-all system.
“You don’t have to just do a standard repayment,” Herbin said. “You could possibly qualify for income-driven repayment … or if you work for a nonprofit or as a teacher or first responder or for AmeriCorps, you could qualify for the public service loan forgiveness program.”
For Gen Zers, income-driven repayment plans, such as Pay As You Earn and Revised Pay As You Earn, may help make payments more manageable, according to Tu.
“If you’re a Gen Z borrower, you’re likely at the beginning of your career and not making as much as you will in a few years,” she said. “If you qualify for an IDR plan, this could help you significantly lower your monthly payments, and limit how much interest your debt can accrue.”
The Biden administration has also made the terms of IDRs more generous, including cutting in half the amount that qualified borrowers have to pay each month, from 10% to 5% of their discretionary income.
Borrowers may also opt for an on-ramp repayment program where, for 12 months, interest will still accrue on the loan, but the Department of Education will not refer borrowers who miss monthly payments to credit agencies.
For borrowers who cannot keep up with payments, other options like a deferment or forbearance period also exist.
Tu noted that especially for Gen Z borrowers, whose loans are now also accruing interest, a priority should be placed on paying off debt.
“Depending on the interest rate of your federal student loans, it may compound faster or slower than other debt you may have,” she said. “If you want to pay down all of your debt in the fastest and most efficient way, tackle debt with the highest interest rate first. A solid rule of thumb is to make the minimum payment across all your debt, but you may want to pay down any private student loans you have first before aggressively tackling federal student loan debt.”
ABC News’ Alexis Christoforous contributed to this report.
(NEW YORK) — A New York judge ordered the cancellation of the business certificates for firms in the state owned by former President Donald Trump and others associated with the Trump Organization, casting into doubt the future of the private sector empire on which Trump has built his reputation for business acumen.
The directive came as part of a pretrial ruling in a $250 million civil fraud trial that found Trump had submitted “fraudulent valuations” for assets that were then used by himself, his eldest sons and his business to obtain better loan and insurance terms.
In a scathing order on Tuesday, Judge Arthur Engoron cited “false and misleading square footage” of Trump’s Fifth Avenue apartment, among other faulty valuations, among other tactics.
Eric Trump, who runs the Trump Organization’s day-to-day operations, responded on X, previously known as Twitter, saying, “Today, I lost all faith in the New York legal system. Never before have I seen such hatred toward one person by a judge.”
“We have run an exceptional company — never missing a loan payment, making banks hundreds of millions of dollars, developing some of the most iconic assets in the world. Yet today, the persecution of our family continues…” he said.
Trump attorney Alina Habba said Tuesday that Trump plans to immediately appeal what she called the judge’s “fundamentally flawed” decision. In addition, Trump could seek an emergency stay of the trial.
The trial is set to proceed next week as the court is still required to decide six remaining causes of action alleged by Attorney General Letitia James, as well as the scope of the potential penalty, Engoron said on Wednesday.
The order on Tuesday, however, holds significant potential implications for the Trump Organization and its underlying assets, though the exact scope of the decision remains unclear.
Here’s what to know about what the order means for the Trump family’s business holdings:
Which businesses are affected?
The ruling on Tuesday took business certificates away from New York-based companies under the control of key Trump Organization figures, effectively stopping such firms from doing business in the state.
The order to cancel business certificates applies to any firm controlled or owned by Donald Trump and his sons Donald Trump Jr. and Eric Trump, as well as former Trump Organization officials Allen Weisselberg and Jeffrey McConney, Engoron said.
That could mean the end of operations for iconic Trump properties such as Trump Tower, located in Midtown Manhattan; Trump National Golf Club in Westchester County; and The Trump Building, a 927-foot tall commercial tower on Wall Street.
Taken together, the businesses employ hundreds of people and make up a significant portion of the Trump Organization’s holdings.
The order, however, does not apply to the Trump Organization as a whole. The company’s entities outside of New York could still operate.
What will happen to the businesses?
Within 10 days of the ruling, the parties to the lawsuit must recommend at least three potential receivers to manage the dissolution of the “canceled LLCs,” Engoron said, referring to the businesses owned or controlled by the key individuals associated with the Trump Organization.
The process could result in the forced closure of the entities and the potential sale of their underlying assets.
What unanswered questions remain?
Significant questions remain about how Engoron’s order will be carried out.
In a court hearing on Wednesday, Trump attorney Chris Kise asked Engoron to confirm which of Trump’s hundreds of business entities would be covered by Tuesday’s ruling.
“With all of these entities and all the employees of these entities, we just want to be sure we have some clear picture,” Kise said.
Engoron did not issue a bench ruling or immediately respond to the question, instead punting the matter to a future private meeting between counsel.
The ultimate outcome of those deliberations will help determine the consequences of the decision for the parent company Trump Organization, a global portfolio of businesses that includes the Mar-a-Lago resort in Palm Beach, Florida, and the Trump International Hotel in Washington D.C.
The trial to begin on Monday will also determine the potential financial penalty to be incurred in the case, which would count in the hundreds of millions of dollars. The ultimate decision could also bar Trump from making real estate acquisitions and applying for loans in New York.
(NEW YORK) — The Alliance of Motion Picture and Television Producers (AMPTP) and Screen Actors Guild-American Federation of Television and Radio Artists (SAG-AFTRA) will be heading back into negotiations on Monday, Oct. 2.
“SAG-AFTRA and the AMPTP will meet for bargaining on Monday, Oct. 2. Several executives from AMPTP member companies will be in attendance,” SAG-AFTRA and AMPTP announced in a joint statement Tuesday evening.
The union, which represents roughly 160,000 members, began its strike on July 14.
“We appreciate the incredible displays of solidarity and support from all of you over the last 76 days of this strike,” SAG-AFTRA’s statement said.
The union encouraged its members to continue joining the picket lines “in strength and big numbers” as the negotiations resume.
The actors’ strike was launched after union leaders and the AMPTP couldn’t come to an agreement over a new three-year contract following rounds of bargaining.
In June, 98% of the union’s members agreed to authorize a strike if an agreement wasn’t reached, SAG-AFTRA said.
Major roadblocks in the negotiations include concerns over streaming residuals, the impact of AI technology, and union member earnings.
The actors’ strike coincided with the Writers Guild of America’s (WGA) strike, which began months earlier in May. It was the first time both unions had gone on strike at the same time since the 1960s, leaving activity in Hollywood at a standstill.
WGA reached a tentative deal Tuesday, allowing its members to return to work the same day the actors’ union announced new negotiations.
WGA members will begin casting their votes on the union’s deal the same day SAG-AFTRA is set to meet with studios to begin its negotiations.
(NEW YORK) — After 148 days, leaders of the Writers Guild of America have unanimously voted to lift its strike, allowing writers to return to work Wednesday, Sept. 27.
“The WGAW Board and WGAE Council also voted unanimously to lift the restraining order and end the strike as of 12:01 am PT/3:01 am ET on Wednesday, September 27th. This allows writers to return to work during the ratification process, but does not affect the membership’s right to make a final determination on contract approval,” the union announced on Tuesday.
The WGA, which represents nearly 11,500 screenwriters, released the entire seven-page agreement.
Since finalizing the Memorandum of Agreement (MOA), WGA was able to share details of the “exceptional deal, with gains and protections for members in every sector of the business.”
The three-year deal stated “minimums will increase by 5% on ratification of the contract, 4% on May 2, 2024, and 3.5% on May 2, 2025.”
The tentative contract established regulations for the use of Artificial Intelligence in Minimum Basic Agreement (MBA)-covered projects. Namely, prohibiting a company from using “writers’ material to train AI.”
The agreement states AI-generated material “will not be considered source material” and AI can’t write or rewrite literary material.
Writers are allowed to use AI if they wish, but cannot be required by the company they’re working for, according to the agreement.
The agreement also laid out a “viewership-based streaming bonus” — when series and films are viewed by 20% of subscribers in the first 90 days of release, writers get a bonus equal to 50% of the fixed domestic and foreign residual.
The contract will only take effect if it gains majority support from the union members. If the members vote to reject the contract, the two sides will have to return to the bargaining table.
Eligible voters will be able to vote beginning Monday through Oct. 9, and will receive ballot and ratification materials when the vote opens.
The strike was less than a week away from surpassing the longest strike in Writers Guild history, which occurred in 1988 and lasted 154 days.
Los Angeles Mayor Karen Bass issued a statement Monday, following WGA reaching a tentative deal with the studios.
“After a nearly five-month long strike, I am grateful that the Writers Guild of America and the Alliance of Motion Picture and Television Producers have reached a fair agreement and I’m hopeful that the same can happen soon with the Screen Actors Guild,” Bass said.
In July, a union representing nearly 160,000 actors joined the picket lines as they began seeking a new contract of their own, effectively bringing activity in Hollywood to a halt.
(NEW YORK) — The Federal Trade Commission and 17 state attorneys general filed a lawsuit against Amazon on Tuesday, accusing the company of illegally maintaining its monopoly power “to inflate prices, degrade quality, and stifle innovation for consumers and businesses.”
The major tech firm allegedly deployed illegal business tactics “to stop rivals and sellers from lowering prices, degrade quality for shoppers, overcharge sellers, stifle innovation, and prevent rivals from fairly competing against Amazon,” the FTC said in a statement.
The sheer size of Amazon does not amount to a violation of the law, the FTC said. Rather, the agency’s complaint centers on a set of “far-reaching schemes” that impact hundreds of billions of dollars in sales each year and hundreds of millions of shoppers.
“Our complaint lays out how Amazon has used a set of punitive and coercive tactics to unlawfully maintain its monopolies,” FTC Chair Lina Khan said in a statement. “Today’s lawsuit seeks to hold Amazon to account for these monopolistic practices and restore the lost promise of free and fair competition.”
In a statement, Amazon rebuked the allegations, saying the practices at issue have helped fuel innovation rather than stifle it.
“Today’s suit makes clear the FTC’s focus has radically departed from its mission of protecting consumers and competition,” Amazon said. “The practices the FTC is challenging have helped to spur competition and innovation across the retail industry, and have produced greater selection, lower prices, and faster delivery speeds for Amazon customers and greater opportunity for the many businesses that sell in Amazon’s store.”
“The lawsuit filed by the FTC today is wrong on the facts and the law, and we look forward to making that case in court,” the company added.
The FTC’s lawsuit focuses on alleged practices undertaken by Amazon that the agency says result in higher prices for consumers.
For instance, Amazon allegedly punishes sellers on its platform that offer products at discounted rates elsewhere online. By placing such sellers in an inferior position in potential customers’ search results, Amazon can render them “effectively invisible,” the FTC said.
Further, the company allegedly makes products’ eligibility for availability on Prime contingent upon vendors using Amazon’s expensive fulfillment service, the FTC said. “This unlawful coercion has in turn limited competitors’ ability to effectively compete against Amazon,” the FTC added.
The announcement on Tuesday follows a lawsuit brought by the FTC against Amazon in June that accuses the company of using deceitful tactics in a yearslong effort to trick millions of customers into enrolling in its Prime subscription service.
In a statement provided to ABC News in June, Amazon called the FTC’s claims “false on the facts and the law. The truth is that customers love Prime, and by design we make it clear and simple for customers to both sign up for or cancel their Prime membership.”
(NEW YORK) — Shoppers who rely on the Supplemental Nutrition Assistance Program, or SNAP, a federal program to provide food benefits to low-income households, will soon have even easier options for online grocery shopping.
Uber recently announced updates to its food and delivery platform Uber Eats, which starting in 2024 will allow users to pay for groceries using SNAP and EBT benefits in the app.
“We know that online food delivery can have a meaningful impact in reducing barriers to fresh groceries, especially for the most vulnerable — including people living in food deserts, seniors, and those facing disabilities or transportation barriers,” the company said in a press release. “Helping to improve access to quality food is incredibly important to our work at Uber and we’re proud to use Uber’s technology and extensive local delivery networks to offer SNAP recipients the ability to use their benefits to access fresh groceries conveniently from our app in 2024.”
The news follows a similar move by competitor Instacart, which in August became the first online grocery marketplace to accept SNAP payments in all 50 states and Washington, D.C., after first launching the payment option in 2020.
Instacart worked closely with the U.S. Department of Agriculture, state agencies and retail partners to help ensure SNAP recipients could have access to the affordable, nutritious food at over 120 grocery banners nationwide — more than 10,000 stores. Its reach totals nearly 95% of U.S. households enrolled in SNAP.
According to an analysis of USDA Food and Nutrition Service data from fiscal year 2020, conducted by Center on Budget and Policy Priorities, more than 41 million U.S. consumers participate in SNAP/EBT, over 65% of whom are families with children. Over 41% of SNAP participants are working families and over 36% are “in families with members who are older adults or are disabled,” according to the think tank.
During the COVID-19 pandemic, Congress made many temporary improvements to SNAP benefits, but as of February 2023 the emergency allotments had expired nationwide.
(NEW YORK) — A group of prominent authors joined a proposed class action lawsuit filed against OpenAI over allegations that products like ChatGPT make illegal use of their copyrighted work, setting off a high-profile legal clash.
While the lawsuit follows a series of similar legal challenges, it features a roster of well-known plaintiffs including authors George R.R. Martin and Jodi Picoult. The case targets a company at the center of a wave of artificial intelligence-driven programs that can instantaneously suggest recipes, compose poems and muse over existentialism.
“At the heart of these algorithms is systemic theft on a massive scale,” the lawsuit claims.
The case could fundamentally shape the direction and capabilities of generative AI, either imposing a new set of limits on a mechanism at the core of the technology or cementing an expansive approach to online material that has fueled the rise of products currently offered, legal analysts told ABC News.
“If anyone is going to win on the straight-up copyright infringement claims against OpenAI, this is probably the lawsuit that has the best chance of it,” James Grimmelmann, professor of digital and information law at Cornell University Law School, told ABC News.
Grimmelmann described the legal filing as a “well-drafted complaint” that presents compelling arguments over copyright infringement while avoiding murkier concerns over trademark issues or privacy.
In a statement to ABC News, an OpenAI spokesperson said the company has held constructive discussions in general with creators and remains confident its technology will prove beneficial to them.
“Creative professionals around the world use ChatGPT as a part of their creative process. We respect the rights of writers and authors, and believe they should benefit from AI technology,” the spokesperson said.
“We’re having productive conversations with many creators around the world, including the Authors Guild, and have been working cooperatively to understand and discuss their concerns about AI. We’re optimistic we will continue to find mutually beneficial ways to work together to help people utilize new technology in a rich content ecosystem,” the spokesperson said.
Here’s what to know about the class action lawsuit brought by authors against OpenAI, and what it may mean for the future of artificial intelligence.
What are the authors claiming in the lawsuit?
Generative AI programs, such as ChatGPT, respond to user prompts through an algorithm that selects words based on lessons learned from scanning billions of pieces of text across the internet.
The primary argument made in the lawsuit brought by the authors, in turn, centers on the alleged illegal use of copyrighted material for the training of the AI models, Pamela Samuelson, a professor at the University of California, Berkeley Law School who specializes in the overlap between technology and copyright, told ABC News.
“The big claim is that the ingestion of works of authorship as training data is itself a reproduction of the works,” Samuelson said.
Lacking permission to use the copyrighted work, OpenAI scans and makes use of the writing, which helps foster work that publishers would otherwise pay authors to create, the lawsuit alleges.
Questions remain over the exact set of data that OpenAI uses to train its products, including whether and to what extent the company draws on copyrighted material, Brian Buckmire, an ABC News legal contributor and former public defender with the Legal Aid Society, told ABC News.
“We know how copyright infringements operate but we don’t know how these data sets work. We don’t even have the ability to look under the hood to see what type of information they are and are not using,” Buckmire said. “This lawsuit could open the pandora’s box, so to speak, to give light to what’s going on.”
OpenAI did not respond to ABC News’ request for comment about the datasets.
A similar lawsuit brought against OpenAI by comedian and actress Sarah Silverman and other authors, in July, alleged that the company scanned her 2010 memoir “The Bedwetter” without her permission. Silverman filed a similar suit over an AI product released by Meta, the parent company of Facebook.
In response to the claim alleging the illegal use of copyrighted material, OpenAI may argue that any alleged copying of protected works falls within an exception to copyright protection known as “fair use,” which allows for the limited reproduction of text for uses like commentary or criticism, Grimmelmann said.
In this vein, Grimmelmann added, OpenAI may defend its alleged use of authors’ work as part of an effort to create separate, original writing rather than to regurgitate identical text.
“Fair use is famously open-ended,” Grimmelmann said.
Last week, Meta and OpenAI each filed separate motions to dismiss the cases brought by Silverman. Both filings citied “fair use” in defense of company conduct.
Arguing in defense of Meta, attorneys argued that “fair use” protections apply to the company’s use of material for the training of its AI product, Llama.
“Copyright law does not protect facts or the syntactical, structural, and linguistic information that may have been extracted from books like Plaintiffs’ during training,” the attorneys said. “Use of texts to train Llama to statistically model language and generate original expression is transformative by nature and quintessential fair use.”
Similarly, attorneys arguing on behalf of OpenAI said that AI-driven chatbots such as ChatGPT, also known as large language models, amount to a novel technological use of copyrighted material that does not violate the law.
“At the heart of Plaintiffs’ Complaints are copyright claims,” attorneys for OpenAI said. “Those claims, however, misconceive the scope of copyright, failing to take into account the limitations and exceptions (including fair use) that properly leave room for innovations like the large language models now at the forefront of artificial intelligence.”
What are the potential implications of the lawsuit?
The implications of the lawsuit will depend on how broadly the court chooses to interpret the challenge brought by the authors, as well as the outcomes of other similar cases, Samuelson and Grimmelmann said.
However, the impact of this case could also hold profound implications for the language-training mechanism on which text bots across the industry rely, they added.
“If the plaintiffs’ claims and their arguments get upheld in full generality then it really does fundamentally reshape the industry,” Grimmelmann said. “If the plaintiffs in this case are right and they get everything they want, then you can’t just scrape the entire web, use all of the existing big data sets and train a model.”
The decision could force AI companies to gain permission from authors and publishers for the use of their work, giving way to potential negotiations over licensing deals between the two sides, Grimmelmann said.
If OpenAI prevails, on the other hand, it could pave the way for private individuals or firms to widely scan the internet and establish AI models based on the results, Grimmelmann added.
“If the AI companies win really broadly and all of the claims get dismissed, it basically means anybody can create an AI model by training it on almost any data they can find,” Grimmelmann said.
The decision could shape the information marketplace, Grimmelmann added.
“This is the biggest challenge to the assumptions that the copyright system makes since the rise of the internet or maybe the rise of mass media,” he said.
Allen J. Schaben / Los Angeles Times via Getty Images
(LOS ANGELES) — The Writers Guild of America reached a tentative deal with the major film and TV studios on Sunday, effectively ending a strike that had lasted 146 days.
Though details of the agreement remain scant, the negotiating committee for the writers’ union lauded the tentative contract as “exceptional,” promising “meaningful gains and protections for writers in every sector of the membership.”
The tentative agreement was confirmed by The Alliance of Motion Picture and Television Producers, or AMPTP, the group negotiating on behalf of the studios. Disney, one of the studios represented by AMPTP, is the parent company of ABC News.
Despite the major breakthrough, key hurdles stand in the way of a return to normal business for Hollywood. The tentative deal must gain a series of union approvals before it takes effect and an ongoing actors’ strike could keep Hollywood at a standstill for weeks or even months.
Here’s what happens next following the tentative agreement between the writers and studios:
Top boards at the union are set to vote on approval of the tentative agreement on Tuesday. If the deal makes it past this step, the contract will be put to a ratification vote among roughly 11,000 Hollywood writers who belong to the union.
The contract will only take effect if it gains majority support from the union members. If the members vote to reject the contract, the two sides will have to return to the bargaining table.
For now, the union is asking writers to stay off the picket lines but continue to withhold their work.
If the senior boards approve the tentative agreement on Tuesday, they may also enact a resolution that allows union members to go back to work as the process for a ratification vote unfolds, the negotiating committee said on Sunday.
“This would allow writers to return to work during the ratification vote but would not affect the membership’s right to make a final determination on contract approval,” the negotiating committee said.
In turn, late-night TV shows and other talk shows could return to air within days, even before the writers vote to finalize the deal struck on Sunday.
The actors’ strike
The majority of output from Hollywood is made up of TV shows and movies that require actors. Since July, a union representing roughly 160,000 actors has been out on strike as they seek a new contract of their own, bringing Tinsel town to a halt.
The end of the writers’ strike could hasten a resolution for the actors, since both sets of workers share similar issues of concern over artificial intelligence and residual payments.
But the two professions also hold different demands in some key areas. The actors, for instance, have faced strong opposition from the studios over a demand that they receive 2% of the total revenue generated by streaming shows.
In the meantime, a prolonged work stoppage among the actors could delay the return to work for writers. In a message to union members announcing the agreement on Sunday, the WGA encouraged writers to join actors on their picket lines.
Allen J. Schaben / Los Angeles Times via Getty Images
(LOS ANGELES) — Unions representing thousands of Hollywood movie and television writers reached a “tentative” deal with major studios on Sunday, ending a strike that lasted 146 days and brought pickets to productions and company offices nationwide.
“WGA has reached a tentative agreement with the AMPTP. This was made possible by the enduring solidarity of WGA members and extraordinary support of our union siblings who joined us on the picket lines for over 146 days,” according to an email sent to WGA members Sunday night.
The resolution followed a breakthrough in negotiations between the Writers Guild of America and The Alliance of Motion Picture and Television Producers, or AMPTP, the group negotiating on behalf of the studios.
The two sides released a joint statement on Wednesday confirming that they had met for bargaining and would resume talks on Thursday, giving rise to optimism that a deal would be struck.
Negotiations resumed on Friday and Saturday, the Writers Guild said, for four straight days of bargaining.
Los Angeles Mayor Karen Bass issued a statement following the ending of the strike. “After a nearly five-month long strike, I am grateful that the Writers Guild of America and the Alliance of Motion Picture and Television Producers have reached a fair agreement and I’m hopeful that the same can happen soon with the Screen Actors Guild,” Bass said.
“This historic strike impacted so many across Los Angeles and across the nation. Now, we must focus on getting the entertainment industry, and all the small businesses that depend on it, back on their feet and stronger than ever before,” she added.
Currently in the middle of its own strike, SAG-AFTRA congratulated the WGA on reaching an agreement. “SAG-AFTRA congratulates the WGA on reaching a tentative agreement with the AMPTP after 146 days of incredible strength, resiliency and solidarity on the picket lines. While we look forward to reviewing the WGA and AMPTP’s tentative agreement, we remain committed to achieving the necessary terms for our members,” according to the organization’s statement.
“Since the day the WGA strike began, SAG-AFTRA members have stood alongside the writers on the picket lines. We remain on strike in our TV/Theatrical contract and continue to urge the studio and streamer CEOs and the AMPTP to return to the table and make the fair deal that our members deserve and demand,” the statement read.
Shortly after SAG-AFTRA’s statement, California Gov. Gavin Newsom also issued a statement regarding the strike’s end. “California’s entertainment industry would not be what it is today without our world class writers. For over 100 days, 11,000 writers went on strike over existential threats to their careers and livelihoods — expressing real concerns over the stress and anxiety workers are feeling. I am grateful that the two sides have come together to reach an agreement that benefits all parties involved, and can put a major piece of California’s economy back to work,” according to Newsom’s statement.
The longest strike in Writers Guild history occurred in 1988, lasting 154 days.
The writers’ strike, which began on May 2, coincided with an ongoing work stoppage undertaken by a union representing roughly 160,000 actors, bringing activity in Hollywood to a halt.
As with writers, the streaming model has slashed the residual payments received by actors when their shows or movies are re-aired, according to the Screen Actors Guild-American Federation of Television and Radio Artists, or SAG-AFTRA.
SAG-AFTRA members have been on strike since July 14.
This is a developing story. Please check back for updates.
