Why This AI Lawsuit Matters to Your Business
Artificial intelligence is quickly becoming part of everyday work for Malaysian SMEs. You may use an AI assistant to draft product descriptions, summarise documents, answer customer questions, prepare social media posts or help your team write emails. The latest legal dispute involving publishers, OpenAI and Microsoft is a reminder that convenience does not remove responsibility.
According to The Verge, The Seattle Times and Newsday have sued OpenAI and Microsoft, alleging that their journalism was used to train AI models without permission and that the systems sometimes reproduce passages from their reporting. The case may be decided in another market, but its practical lesson is highly relevant in Malaysia: you need to know where AI-generated material comes from, how it is used and who is accountable when something goes wrong.
What Happened
The publishers allege that OpenAI used their articles as training data for AI models without authorisation. They also claim that users can sometimes receive passages from their reporting when asking questions through AI tools. The lawsuit names Microsoft as well because Microsoft Copilot uses OpenAI technology, as reported by The Verge.
The two publishers are seeking the destruction of copies of their works, training datasets and AI models that incorporate the disputed material, according to The Verge. They join other organisations, including The New York Times, Ziff Davis, Merriam-Webster and Encyclopedia Britannica, that have also taken legal action against OpenAI, as listed in the same report.
The dispute also reflects a wider concern among publishers. Nearly 400 local newspapers have reportedly sued the companies, arguing that chatbots can reduce the need for people to visit news websites for reporting and answers, potentially affecting subscription revenue. OpenAI and Microsoft had not immediately responded to the request for comment at the time of publication, according to The Verge.
Why This Matters for Malaysian SMEs
For your business, the most immediate issue is not whether you are building an AI model. It is whether your staff are using AI tools to produce materials that are published, sold or sent to customers. A café might ask an AI assistant to create website copy from food blogs. A recruitment agency might paste a candidate’s profile into an online tool. An online seller might generate product descriptions that closely resemble another company’s wording. Each activity creates a different content, privacy or confidentiality question.
Malaysian SMEs also operate in a market where original local content matters. You may rely on Bahasa Malaysia product explanations, local industry guides, property descriptions, training notes, recipes, photographs or customer testimonials. If your team copies material from a newspaper, competitor website, industry association or creator and asks AI to “rewrite” it, the result may still be based too closely on someone else’s protected work. Changing a few words does not automatically make the source safe to use.
There is a second concern: AI tools can produce answers that sound authoritative but are inaccurate or copied. This matters for medical suppliers, financial advisers, education providers, legal-related services and businesses making product claims. A polished paragraph can still contain an unsupported promise, an incorrect regulation or wording that another organisation owns. You remain responsible for what your business publishes, even when software generated the first draft.
Use AI as a drafting assistant, not as an automatic clearance system. Your business still needs a person to verify sources, permissions, facts and final wording.
Practical safeguards for your team
| Risk area | What you should do |
|---|---|
| Copied or similar wording | Ask staff to use original briefs, check important passages and keep source links for research. |
| Private information | Do not upload customer records, identity documents, confidential contracts or internal secrets into public AI tools without approval. |
| Marketing claims | Verify product, health, safety and performance statements before publication. |
| Customer-facing answers | Require human review for chatbot replies involving refunds, complaints, warranties or sensitive matters. |
| Supplier accountability | Review the AI provider’s terms, data controls, output policies and business-use conditions before adoption. |
What You Can Do This Week
Start by creating a simple AI use register. List the tools your team uses, the tasks they support and the types of information entered into them. Include marketing, customer service, recruitment, finance administration and operations. You do not need a large technology department to do this; a spreadsheet reviewed by one responsible person is a practical starting point.
Next, separate low-risk and high-risk uses. Generating headline ideas, formatting a public product list or brainstorming campaign themes is generally easier to review than handling medical information, employment records, legal documents or confidential pricing. Require approval before employees use AI for sensitive tasks.
Give your team a short writing rule: do not paste an entire article, competitor page or paid report into an AI tool and ask for a rewrite. Instead, describe the required facts in your own words, use licensed material where necessary and record the original sources. For important content, ask an employee to compare the final draft with the references before it goes live.
You should also preserve a basic audit trail. Save the source links, the person who reviewed the output, the date of approval and any changes made. This helps you investigate a complaint and demonstrates that your business took reasonable care. It also makes it easier to replace questionable content quickly.
The Bigger Picture
The lawsuits show that the commercial use of AI is moving beyond a simple question of whether the technology is useful. Businesses, publishers, creators and software providers are negotiating who controls training data, how original work is compensated and how generated answers should be attributed. The outcome of overseas cases may influence product terms, licensing models and enterprise safeguards available to Malaysian businesses.
For SMEs, the winning approach is not to avoid every AI tool. It is to adopt the tools with clear boundaries. Choose systems that provide business controls, limit data retention where possible and explain how customer information is handled. Ask vendors how they address copyright complaints, whether they offer administrative settings and what support is available when generated content is disputed.
Think of AI governance as part of ordinary business quality control. Just as you check an invoice before payment or review a quotation before sending it, review AI-assisted content before publishing it. Assign ownership, document the process and make sure staff understand that speed is not a substitute for permission, accuracy or judgement.
The Seattle Times and Newsday case is still a legal dispute, not a final rule for every Malaysian business. However, it gives you a timely warning. If AI is now helping your company create content or make decisions, build a review process before a customer, supplier or rights holder forces you to do so.
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