Hollywood vs. Generative AI: Disney and NBCUniversal Sue Midjourney

The era of machine-driven creativity faces its first major legal test in the film industry. In a lawsuit that could reshape the future of image-generation tools, Hollywood giants such as Disney and NBCUniversal have filed a federal lawsuit against Midjourney, one of the most popular text-to-image platforms.

The complaint, filed in Los Angeles, accuses Midjourney of building its business on a massive and deliberate copyright infringement, directly affecting iconic characters such as Darth Vader, Elsa, Shrek, and the Minions.

The Mechanics of Accusation: Training and Monetization

According to the studios, Midjourney’s infringement scheme operates in two key stages:

• Data scraping: The complaint alleges that Midjourney trained its artificial intelligence models using a vast collection of images scraped directly from its films, without any permission or licensing. Thousands of frames were reportedly used to teach the AI to replicate styles, characters, and settings.
• On-demand generation: With the trained model, the platform allows its millions of subscribers to generate images of these characters in any conceivable context, functioning, in the studios’ words, as a “virtual vending machine” for pirated intellectual property.

The lawsuit cites examples of prompts such as “Darth Vader on a Paris fashion runway,” which generate studio-quality images. For Disney and Universal, the case is clear, and the violation of U.S. copyright law is “unequivocal.”

The business model at the heart of the dispute

The lawsuit focuses not only on the technology, but also on Midjourney’s robust business model. With estimated subscription revenue of $300 million for 2024, the studios argue that the main driving force behind this growth is the demand for images from their franchises.

Midjourney’s service is structured around four paid plans, ranging from $10 to $120 per month. These plans offer users different amounts of “GPU time” for generating images. Even the most basic plan allows users to create hundreds of images, while the higher tiers offer virtually unlimited generation.

With over 20 million registered users, the studios claim that every generated image that uses their intellectual property exacerbates the commercial harm, turning the infringement into a monthly software-as-a-service (SaaS) product.

What do the studios require?

The claims brought by Disney and NBCUniversal are wide-ranging and seek not only financial compensation but also a fundamental change in Midjourney’s operations. The claims include:

• Compensation: Payment of statutory damages of up to $150,000 for each infringed work.
• Preliminary Injunction: A preliminary and permanent court order preventing Midjourney from distributing any images or future videos that depict its intellectual property, unless robust filters are implemented.
• Transparency: Full disclosure of the dataset used to train its AI models, a crucial factor in understanding the extent of the alleged violation.
• Return of Profits: The creation of a fund to retain all profits earned by Midjourney from the unauthorized use of its intellectual property.
• Attorney's Fees: Reimbursement of legal expenses incurred during the proceedings.

This showdown is the first of its kind initiated by major Hollywood studios and promises to be a game-changer.

The final decision could set a crucial precedent for how AI models can be trained, licensed, and monetized, shaping the future of creative tools and the balance between technological innovation and intellectual property protection in the audiovisual sector.