According to an analysis by Bloomberg Law, recent judicial trends indicate a growing preference among judges to rule against fair use in generative AI (GenAI) copyright cases, favoring summary judgments instead. The key case influencing this trend involves the Warhol Foundation's litigation over the "Prince Series" artworks, where the Supreme Court highlighted that "transformative use" alone does not guarantee a fair use finding, especially if the use is commercial and serves a similar purpose as the original work​.

In the Warhol case, the Court ruled that licensing Warhol's "Orange Prince" image to Condé Nast was not fair use, despite its transformative elements. The Court's decision emphasized that the commercial nature and identical purpose of the use weighed heavily against fair use. This ruling underscores the importance of considering the context and purpose of the use rather than relying solely on whether the work adds new meaning or message​.

The implications of this decision are significant for generative AI models that utilize copyrighted material for training. In the case of Thomson Reuters v. ROSS, which involves the use of Westlaw data to train a GenAI model, the arguments centered around whether such use is transformative and thus protected under fair use. However, the Court's interpretation in the Warhol case suggests that commercial use of copyrighted content, even with transformative elements, may not meet the fair use criteria​.

Legal scholars note that the shift towards summary judgment in fair use determinations marks a departure from the historical norm where such issues were typically resolved by juries. This change raises constitutional concerns about the Seventh Amendment right to a jury trial and the First Amendment right to free speech. Critics argue that judges are increasingly characterizing factual issues as legal ones, thereby bypassing jury evaluations and potentially weakening the fair use doctrine​.

The outcome of these cases could have a profound impact on the future of AI development and the use of copyrighted material in training datasets. Companies and developers are advised to closely monitor these legal developments and seek specialized legal counsel to navigate the complexities of copyright and fair use in the context of generative AI.