Source: Bloomberg Law

Three shareholder derivative lawsuits filed in recent months seek to hold senior executives at Microsoft Corp. and Adobe Inc. accountable for allegedly providing false or misleading information about their AI strategies and failing to disclose the methods used to train generative models. The complaints say those alleged omissions and misstatements exposed the companies to legal risk, pointing to parallel litigation by writers’ guilds, publishers, authors and news outlets that contend AI developers trained models on copyrighted works without authorization or compensation. Plaintiffs tie share-price declines to the surfacing of new copyright suits and allege securities-related harm from allegedly misleading SEC filings; Microsoft has called the shareholder claims “without merit,” while Adobe did not respond to requests for comment.

The derivative suits cite prior copyright actions and large settlements involving other AI firms as red flags directors allegedly ignored, and commentators in the piece characterize these filings as early tests of courts’ tolerance for claims tied to unclear fair-use boundaries. Legal scholars quoted in the report say successful derivative claims may not depend solely on proving copyright infringement but on showing that executives’ conduct harmed the corporation or breached duties. The article notes ongoing landmark copyright proceedings — including multidistrict litigation involving OpenAI and separate cases against other platforms — and concludes that until copyright law’s application to AI training is clarified, the outcome and potential damages of these shareholder suits remain uncertain.