The world’s first case involving a generative artificial intelligence: Shanghai Xinchuanghua Cultural Development Co Ltd v AI Company (pseudonym)

Shanghai Xinchuanghua Cultural Development Co Ltd v AI Company (pseudonym) is the first in the world to render a judgment on whether a generative artificial intelligence service provider should bear copyright liability for the infringement of other people’s prior works by its generated content. The court ruled on the types of copyright exclusive rights involved in the infringement by generative artificial intelligence service providers. However, the court should not bypass addressing the prerequisite issue of the copyrightability of the generated content. More importantly, it established criteria for determining the duty of care of generative artificial intelligence service providers based on three aspects: the duty to establish a complaint and reporting mechanism, the duty to warn of potential risks and the duty to provide prominent labelling. By focusing on the duty of care, the court shifted the burden of proof for causation to the defendant, thereby avoiding the evidentiary challenges faced by European and American courts. Additionally, the court established specific measures to stop the infringement.