The news: Warner Bros. Discovery (WBD) sued AI image generator Midjourney, accusing it of “mass theft” of copyrighted films and TV shows for training. The complaint cites prompts that yield near-identical renderings of Bugs Bunny, Batman, Superman, Wonder Woman, Scooby-Doo, and Rick and Morty.

Disney and NBCUniversal launched similar claims, arguing Midjourney diverts consumers from licensed products while profiting through monthly subscriptions ranging from $10 to $120. The studios seek either Midjourney’s profits or statutory damages up to $150,000 per infringed work.

Why it matters: There are significant financial ramifications for all stakeholders—Anthropic recently settled claims that it illegally downloaded books—which raises the stakes. At the heart of the case is whether training on copyrighted content qualifies as “fair use.”

The risk is top of mind for enterprises: 52% of IT professionals cite intellectual property infringement as a leading genAI concern, yet only 25% were actively working to mitigate against it.

Our take: The lawsuit highlights the clash between Hollywood IP and mainstream AI tools, serving as a warning to marketers that AI-generated creative may carry legal and reputational risks if it includes unlicensed content.

More than half (53%) of marketers already use image generators like Midjourney for social media, and creators are quickly expanding into AI-driven visuals and video. Yet the gap between rapid adoption and limited safeguards suggests legal clashes will multiply before regulatory clarity arrives.

Until courts decide whether training on copyrighted material qualifies as “fair use,” advertisers may hesitate to scale their use of visual genAI tools. If platforms like Midjourney face restrictions, demand could shift toward providers that strike licensing deals with rights holders—offering a safer, but potentially more expensive, route.

At the same time, consumers are already pushing back on sloppy or obvious AI ads, raising expectations that marketers ensure AI creative is both legally compliant and creatively credible.