Thomson Reuters v. ROSS: Third Circuit Recognizes A Licensing Market For AI Training Data

On September 29, 2026, the Third Circuit issued what appears to be the first federal appellate decision on whether training AI on copyrighted material is fair use. In Thomson Reuters v. ROSS Intelligence, the court affirmed that case-law headnotes are copyrightable and that using them to train a non-generative legal-research tool was not fair use. Early coverage has emphasized footnote 7, which distinguishes AI that "cannot generate original expression" from generative models, and the court's finding that "the evidence shows that the market for licensing headnotes as text to train AI is rapidly developing." Less attention has gone to how courts will test evidence of that market.

Under the fourth factor, the court found harm to the original market and to the value of the headnotes, and it also recognized a potential derivative market for licensing them as training data. It cited evidence that the copyright owner was using its headnotes "as training data for its own AI search products"