On June 11, 2025, Disney and Universal jointly filed a federal lawsuit in the Central District of California against AI company Midjourney, alleging mass infringement of their copyrighted characters.
Allegations at a Glance
- Unauthorized character replication: Plaintiffs claim Midjourney’s image generator churns out exact or near-exact likenesses of iconic figures, including Shrek, Darth Vader, Buzz Lightyear, Yoda, Elsa, Minions, Spider-Man, Groot, and others.
- No copyright safeguards: Despite warnings, Midjourney allegedly failed to adopt blocking mechanisms (such as prompt filters and screening tools) respected by rival platforms.
- Video generation under threat: The lawsuit warns that Midjourney’s soon-to-be-released video AI will further compound infringement, likely producing unauthorized (and monetized) footage featuring Disney and Universal characters.
- Seeking remedy: The studios demand monetary damages—including disgorgement of profits—along with injunctive relief to bar future infringement via filters or other technical methods.
Why This Case Matters
- Stronger factual footing: Unlike text-based suits, Disney/Universal can submit direct “side-by-side” comparisons proving their characters were copied.
- Fair use defense tested: Midjourney may invoke “fair use,” similar to OpenAI in other cases. However, experts note the striking resemblance between outputs and copyrighted characters strengthens plaintiffs’ position.
- Industry vs. smaller players: Disney and Universal may seek a precedent-setting win against Midjourney before escalating to larger AI firms like Google, Microsoft, or OpenAI—a “test case” approach.
- Precedent on technical measures: Plaintiffs are asking courts to require AI companies to implement prompt-blocking and output filters, potentially reshaping compliance demands across the sector.
Legal Implications for Counsel and Clients
For Content Owners (e.g., studios, publishers)
- A roadmap for enforcement: This suit may signal a robust model for pursuing infringers, complete with visual proof, financial remedies, and oversight of AI output.
- Pre-suit tactics matter: Disney/Universal issued warnings to Midjourney before filing suit, demonstrating a best practice to strengthen claims later.
For AI Companies and Users
- Fair use isn’t assured: Mere transformation won’t protect AI firms if outputs demonstrably replicate unique character features.
- Tech mitigation essential: Prompt filters, IP-aware screening, watermark flagging, and negative prompting—all may be legally advisable.
- Training data disclosure: Courts may demand transparency about datasets used to train AI, exposing potential liability early.
For Attorneys Advising Clients
- Licensing as a defense strategy: AI developers could safeguard themselves by securing licensing arrangements or indemnifications from copyright owners.
- Risk management: Clients using AI tools commercially should consider audits of AI outputs, legal reviews, and insurance coverage.
Bottom Line
This case may redefine lawful boundaries for generative AI, serving as a pivotal juncture where fair use is weighed against commercial replication of cultural icons. It underscores the need for practitioners to:
- Ensure evidence-backed claims (output comparisons);
- Promote technical compliance strategies for AI firms;
- Consider licensing as a commercial pivot rather than litigation as the sole approach; and
- Evaluate cross-border implications amid varying copyright protections globally.