Legal Battle Intensifies Over AI Training on Copyrighted Characters
As part of an ongoing legal dispute with three Hollywood studios, AI startup Midjourney is seeking to compel those studios to reveal how they use artificial intelligence themselves. The motion, filed on July 4, 2026, aims to expand the scope of discovery in a lawsuit that has significant implications for the entertainment and AI industries.
Background of the Legal Dispute
Fair Use Defense at the Core
Midjourney was sued last year by the studios, which alleged that the startup’s image-generation models could create images of famous characters such as Bart Simpson and Darth Vader, characters owned by the studios. A few months later, the studios filed an additional lawsuit as well. Midjourney argues that training its AI models on images of copyrighted characters is permitted under fair use.
The Discovery Dispute
Midjourney’s Motion to Compel
The current dispute revolves around the documentation the studios will need to produce during the discovery process. A judge previously ruled that the studios would indeed have to provide information about their generative AI usage – but only when it led to “consumer-facing” videos and images. In a recent motion, Midjourney seeks to overturn that limitation, arguing that it “unfairly” allows the studios “to cherry-pick only those documents they believe support their market harm claims while depriving Midjourney of documents that would support its defenses.”
Midjourney goes on to claim that the “documents [the studios] are withholding are precisely those that would reveal whether, behind closed doors, they are doing exactly what they are suing Midjourney for doing.” For example, the startup says that if the studios are developing image-generating AI models “for internal use in storyboarding or ideating content for film or TV, that evidence would equally demonstrate that it is an industry custom, even among the studios themselves, to download and train AI on unlicensed copyrighted content.” In the filing, Midjourney also argues that the studios should reveal all the prompts they used in Midjourney, as well as the resulting outputs, not just the prompts that produced the allegedly infringing images.
Studios’ Response
The studios’ lead attorney dismissed the motion as part of a “fishing expedition.” He also said the studios “do not seek to stop AI technology or even shut down Midjourney’s business,” but rather “simply want Midjourney to stop copying their movies and TV shows and to stop distributing, publicly displaying, publicly performing, and creating derivative works that include copies of [their] famous characters without authorization.”
What This Means for the Future of AI and Copyright
The outcome of this legal battle could set a precedent for how AI companies train on copyrighted material and how much transparency is required from both sides in such disputes. As the case progresses, all eyes will be on the judge’s decision regarding the scope of discovery.