Encyclopædia Britannica and Merriam-Webster have filed a federal lawsuit in opposition to synthetic intelligence startup Perplexity AI, alleging widespread copyright infringement and trademark violations. The grievance, filed within the Southern District of New York on September 10, 2025, marks one other vital authorized problem dealing with AI firms over their use of copyrighted content material.

In keeping with the lawsuit, Perplexity operates what it calls an “reply engine” that “eliminates customers’ clicks on Plaintiffs’ and different internet publishers’ web sites—and, in flip, starves internet publishers of income—by producing responses to customers’ queries that substitute the content material from different info web sites.” The publishers declare Perplexity engages in “huge copying” of their protected content material with out authorization or compensation.

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Britannica, based in 1768, operates as a worldwide digital training platform serving over 150 million college students throughout greater than 150 international locations. The corporate recorded over one billion periods at britannica.com in 2024 alone, excluding a further 1.4 billion periods throughout different Britannica-maintained web sites together with merriam-webster.com. Merriam-Webster has served as America’s main dictionary writer since 1831.

The lawsuit particulars three distinct methods Perplexity allegedly infringes copyrights. First, by means of knowledge curation utilizing software program known as “PerplexityBot” to crawl and scrape web sites. Second, by copying copyrighted articles as inputs for its retrieval-augmented era (RAG) mannequin. Third, by producing outputs that comprise verbatim reproductions, summaries, or paraphrases of copyrighted works.

Perplexity makes use of RAG expertise, which connects massive language fashions to exterior info sources to enhance output high quality. The method entails receiving consumer prompts, acquiring content material from search indexes, combining prompts with retrieved content material, and producing natural-language responses. In keeping with Perplexity’s founder and CEO Aravind Srinivas, this method follows the precept that fashions ought to “solely say what you possibly can cite.”

The grievance contains particular examples of alleged infringement. When customers requested Perplexity about Merriam-Webster’s definition of “plagiarize,” the system reproduced the precise definition from the copyrighted Collegiate Dictionary. Equally, requests for Britannica content material on matters like Druids and quantum physics resulted in near-verbatim reproductions of copyrighted articles, together with similar picks and ordering of knowledge.

Investigators have documented Perplexity’s use of undisclosed crawling strategies that bypass web site protections. In keeping with a Cloudflare report from August 2025, Perplexity employs “stealth, undeclared crawlers” that impersonate Google Chrome browsers and make the most of a number of IP addresses not listed within the firm’s official ranges. This permits the system to entry content material even when web sites explicitly prohibit such entry by means of robots.txt recordsdata and firewall guidelines.

The publishers emphasize the monetary influence of this alleged infringement. Britannica’s phrases of use explicitly prohibit knowledge mining and AI coaching with out categorical written consent. The lawsuit states that Perplexity’s outputs are “designed to eradicate the necessity for its customers to go to the unique content material creators’ web sites,” thereby lowering promoting and subscription revenues.

Perplexity has confronted mounting criticism over its content material practices. The New York Instances and BBC have issued cease-and-desist notices, whereas Dow Jones filed an analogous lawsuit in January 2025. Forbes described the corporate’s method as “cynical theft,” and a number of publications have accused Perplexity of working as a “plagiarism engine.”

In response to criticism, Perplexity launched a Publishers’ Program in July 2024 providing income sharing with content material creators. The corporate has additionally secured licensing agreements with publishers together with Time, Der Spiegel, and The Los Angeles Instances. Nonetheless, the publishers argue this program represents an try and “retroactively dictate the phrases of a license” after already taking copyrighted materials.

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The lawsuit additionally addresses trademark violations, alleging that Perplexity falsely attributes AI-generated “hallucinations” to the publishers whereas displaying their logos. Moreover, the grievance claims Perplexity omits parts of articles with out disclosure whereas suggesting full copy.

Perplexity has maintained that its practices fall inside honest use copyright protections. Chief Enterprise Officer Dmitry Shevelenko said the corporate operates “clearly inside these bounds” of honest use and copyright regulation. Nonetheless, the U.S. Copyright Workplace’s Could 2025 report on AI and copyright concluded that RAG techniques are “much less more likely to be transformative” when producing summaries or abridged variations of copyrighted works.

The corporate’s speedy progress underscores the monetary stakes concerned. Perplexity reached a $20 billion valuation in its newest funding spherical and stories serving over 100 million generative search outcomes weekly. The startup, backed by buyers together with Jeff Bezos and Nvidia, has roughly 22 million lively customers throughout its platforms.## Why This Issues for the Advertising and marketing Group

This lawsuit represents a essential growth for digital entrepreneurs and promoting professionals, because it challenges basic assumptions about how AI platforms can monetize copyrighted content material. The legal action directly impacts how AI search engines can operate commercially, notably as Perplexity has positioned itself as an alternative choice to conventional search platforms.

The case raises vital questions in regards to the sustainability of AI-powered promoting fashions. Perplexity launched its advertising program in late 2024, that includes sponsored questions and facet media placements whereas claiming to take care of unbiased search outcomes. Nonetheless, if courts discover the underlying content material sourcing practices unlawful, all the enterprise mannequin faces potential disruption.

The departure of advertising head Taz Patel in August 2025 after solely 9 months might replicate broader challenges dealing with the platform’s monetization efforts amid mounting authorized strain. Advertising and marketing professionals who’ve invested in Perplexity’s promoting ecosystem now confront uncertainty about platform stability and long-term viability.

The broader implications prolong past Perplexity to all the AI promoting panorama. As AI agents potentially replace humans as advertising targets, the authorized framework governing content material utilization turns into more and more essential. If publishers efficiently defend their copyright claims, it may power basic modifications in how AI platforms supply and monetize info.

For efficiency entrepreneurs, this case highlights the significance of diversification throughout promoting platforms. The US Copyright Office’s recent guidance on AI training means that licensing preparations will grow to be important for sustainable AI operations, doubtlessly growing prices for platforms like Perplexity and finally affecting promoting pricing.

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Abstract

Who: Encyclopædia Britannica, Inc. and Merriam-Webster, Inc. filed the lawsuit in opposition to Perplexity AI, Inc. within the Southern District of New York. The plaintiffs are represented by attorneys from Susman Godfrey L.L.P.

What: The publishers allege huge copyright infringement by means of three mechanisms: unauthorized crawling and scraping of internet sites, copying copyrighted content material as inputs for RAG processing, and producing outputs that reproduce or summarize protected works. The lawsuit additionally claims trademark violations by means of false attribution of AI hallucinations and undisclosed content material omissions.

When: The grievance was filed on September 10, 2025, overlaying alleged infringement relationship again to Perplexity’s launch in 2022. The case builds on mounting authorized strain following earlier lawsuits from Dow Jones and cease-and-desist notices from The New York Instances and BBC.

The place: The lawsuit was filed in the US District Courtroom for the Southern District of New York. The alleged infringement impacts content material creators globally however notably impacts publishers with vital New York-based operations and readership.

Why: The publishers search to guard their substantial funding in content material creation and stop what they characterize because the “huge unlawful switch of income” from content material creators to AI platforms. They argue that Perplexity’s practices threaten the financial incentives needed for producing high-quality, reliable info.


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