Unsealed court documents from the New York Times' lawsuit against OpenAI and Microsoft reveal internal communications showing the companies were aware they were creating a 'doom loop' that would damage the web, characterized their data scraping as 'the largest theft of labor in human history,' and acknowledged their models memorize and regurgitate copyrighted content verbatim despite knowing this violates fair use principles.
Microsoft director Brent Hecht admitted in court documents that AI models create a 'doom loop' by stealing media content without compensation, ultimately harming both the news industry and AI performance. CEO Satya Nadella acknowledged that AI platforms substitute for visiting original news sources. The admissions emerged in a New York Times copyright lawsuit against OpenAI, in which Microsoft is implicated as OpenAI's largest shareholder.