Executives at Microsoft and OpenAI have admitted that large language models are predatory technologies built on an “astonishing theft of unprecedented proportions,” describing the event as the “largest theft of labour in human history.” An internal Microsoft document further stated that generative AI products have created a “doom loop” that is killing the entire web.
These statements appear in a heavily unredacted court filing unsealed Thursday in the New York Times vs OpenAI copyright lawsuit. Lawyers for the newspaper laid out admissions made by Microsoft and OpenAI executives in documents and depositions that had previously remained sealed or redacted at the request of both companies.
The filing, written by the New York Times legal team, asks for summary judgment. It compiles admissions regarding how the models were trained, how they function, and the immediate threat they pose to human labour.
It is clear why the companies wanted to hide this information. The statements collectively indict the methods used to train LLMs, their operational mechanics, and the danger they present to human workers. This serves as a reminder that while companies shift the narrative toward the existential risk of “superintelligent” AI, the tools they have already built were created by stealing from human creativity and labour. By definition, these tools are existential threats to the human labour market.
“Millions of people around the world will soon consider large models ‘hoovering up’ all their work to be an astonishing theft of unprecedented proportions,” an internal Microsoft document cited in the case read. It added that “almost no one intended for content they created to be used in this fashion, nor are they compensated for its use.”
The filing was discovered by Jason Kint, CEO of Digital Content Next, a trade organisation representing digital media companies. Kint has been closely following and posting about massive AI copyright lawsuits.
How the business model fails
The court filing cites an internal Microsoft document stating that AI products steal from human content creators and then cannibalise clicks from the people and websites they have stolen from, thereby destroying their business models.
“Our AI content strategy has started a ‘doom loop’ that will hurt the performance of our models and the entire web at the same time,” the document said. “It is highly unusual that an end-product threatens the economic foundations of its essential suppliers, but that is the situation we have created for our LLM business with respect to its ‘content supply chain’.”
Microsoft CEO Satya Nadella testified under oath that after ripping content from the New York Times and other news sites, clicks to those sites fully cratered, falling by more than 90 percent on Bing.
Documents obtained during court proceedings found that OpenAI created “a hack to get around nytimes paywall,” to which OpenAI co-founder Greg Brockman said “ah, nice.” Microsoft executive Brent Hecht wrote that LLMs steal content “without ways of distributing economic value down the supply chain, [which] necessarily threatens the economic stability of those who create the content.”
OpenAI policy director Jack Clark wrote that the company was “creating systems that substitute for the labour of the people that define the ‘culture’ of society.” Microsoft, in a policy document, wrote that generative AI could “significantly disrupt the employment of the very people who generated the data on which the foundation model was trained.” Microsoft further noted that “LLMs are a product that destroys its supply chain.” OpenAI described itself as an “existential threat” to news publishers, and an OpenAI software engineer testified that “no matter how prominently we show the links, users won’t click.”
What it means
OpenAI and Microsoft lawyers have argued that their model training is fair use and transformative under copyright law, claiming they are building something fundamentally different from the human labour it was trained on. Internally, however, these executives know that their products were built on stolen content and are cannibalising the sources they stole from. This admission confirms that the companies are destroying the internet as it currently exists.
