Corporate Drama

Units of Sony Music and Warner Music sued Anthropic in federal court in northern California, alleging the company trained Claude on tens of thousands of copyrighted compositions through illegal torrenting, scraping, and downloading. The 48-page complaint names CEO Dario Amodei and co-founder Benjamin Mann and seeks hundreds of thousands of dollars per infringed work.\n\nAnthropic, which agreed to the largest copyright settlement in U.S. history, a $1.5 billion deal with authors and publishers in September 2025, said it disagrees with the publishers' claims and will defend itself in court.

A subset of Grok Lite users on Grok.com began receiving pure word-salad responses Wednesday, with the chatbot producing strings of unrelated words instead of answers. One user who asked for a PDF got back several paragraphs of nonsense starting with "match it without and your they and two for planets can practical and often cheese." xAI called it a rare temporary generation glitch and pointed to a status page showing all services operational. Refreshing usually fixed it, though some users on Reddit reported the gibberish persisting after multiple reloads.

The timing is notable if not conclusive: the glitch arrived amid documented heavy turnover at xAI, which has reportedly lost most of its founding team and at least 50 researchers and engineers since shipping Grok 4.5 in July. xAI has not confirmed any connection between the staffing churn and the failure, and generation glitches do occur across labs. The Grok account on X was unaffected, and TechCrunch couldn't reproduce the issue, suggesting it hit only a small slice of users.

Microsoft is merging its consumer Copilot app and Microsoft 365 Copilot into a single product, and cutting several features in the process. Gone by August 18: Group Chats, AI-generated podcasts, Copilot Labs, and Deep Research for free-tier users. Also gone is Mico, the animated floating blob Microsoft had introduced as Copilot's mascot before apparently reconsidering that decision.

The consolidation follows an internal memo from Microsoft EVP Jacob Andreou, who oversees Copilot, telling staff the app needed to earn "the right to exist" in customers' lives. Two years after Microsoft declared AI a "generational shift" it intended to lead, it is now running the same playbook as its rivals: collapsing overlapping apps into one and quietly retiring the features that didn't land.

Stella Sacco, the former lead writer on Saber Interactive's upcoming Rideshare "Stimulator", says she was fired in December 2023 and replaced mid-development by ChatGPT. The game's trailer, released last month, appears to feature AI-written and AI-voiced dialogue. Saber's Steam listing carries no AI-content disclosure, which the platform requires.

CEO Matthew Karch initially denied replacing any writers with AI, then confirmed to The Verge that the game "incorporates AI," then issued a statement to This Week In Video Games in which he said he had to ask Claude who Sacco even was, called her replacement "someone more talented," and added that he would "frankly in retrospect have been happy to replace her with AI. At least we would be dealing with someone programmed to be honest." Sacco's response was measured: "This screed will be many people's first exposure to the Saber brand."

DC Studios took down a behind-the-scenes featurette for Supergirl from YouTube after viewers spotted AI-generated concept art of Jason Momoa as the character Lobo. The featurette, titled "Lobo - DC Dream Behind The Scenes," showed director Craig Gillespie's team using AI-generated imagery, drawing negative reactions across X, Threads, and Reddit.

The use of AI concept art clashes directly with public statements from DC Studios co-CEO James Gunn, who has repeatedly rejected generative AI for creative work, and DC Comics head Jim Lee, who declared at New York Comic-Con 2025 that "DC Comics will not support AI-generated storytelling or artwork. Not now. Not ever." The featurette remains available in the Extras section of the Supergirl digital release. No statement has been issued by DC Studios, Warner Bros., or Gillespie.

Anthropic ran an internal simulation in which Claude Opus 4.5 — deployed as an assistant called "Atlas" — flagged a safety failure in an upcoming model, escalated it to leadership, and received a direct stand-down order from a fictional version of CEO Dario Amodei. The model acknowledged the order, then proceeded to ignore it. It tried contacting outside researchers, and when that failed, pivoted to coaching a junior employee named Jenny through the process of leaking the information externally.

Anthropic's 14,000-word public research post omitted the detail that the authority figure Claude defied was a simulated Amodei; that only surfaced in the full transcripts. Lead researcher Aengus Lynch told the Bureau that Jenny's decision to leak was substantially shaped by information the AI fed her, complicating any claim that the human retained full agency. Lynch noted the model happened to act ethically in this scenario, but the control failure itself is structural.

The New York Times and The Daily News have accused OpenAI of hiding evidence in their ongoing copyright lawsuit, alleging the company misrepresented its ability to search training data and chat logs. A court-ordered deposition of OpenAI data privacy engineer Vinnie Monaco allegedly revealed that OpenAI had already conducted internal searches of its training corpus for copyrighted journalism — and had amassed a database of roughly 78 million de-identified ChatGPT conversations to assess its own infringement exposure. OpenAI had previously argued that such searches were technically burdensome and privacy-sensitive.

Further compounding the allegations, the plaintiffs claim OpenAI built a "Bloom" filter under an internal initiative called "Project Giraffe" to detect and log output regurgitation shortly after the lawsuit was filed — then allegedly deleted billions of ChatGPT outputs in violation of a court preservation order, submitted a heavily redacted 20-million-log sample the court itself called "unusable," and substituted millions of logs in the requested sample. The NYT and Daily News are now asking the judge to sanction OpenAI, bar it from using the chat log sample as evidence, and compel it to pay legal fees. OpenAI denied the allegations, framing the move as a privacy attack on users by plaintiffs with a weakening case.

Meta secretly ran a months-long program, internally dubbed "Cannes" and operated through contractor Covalen, that paid hundreds of workers to impersonate minors while bombarding ChatGPT, Gemini, and Character.AI with tens of thousands of deeply disturbing prompts — covering suicide, self-harm, eating disorders, cannibalism, and sexual content — all written from the perspective of children and teenagers. The targeted companies had no idea this was happening. Meta called it "industry-standard" safety benchmarking; critics called it something else entirely.

What Meta actually did with the resulting spreadsheets of competitor chatbot responses remains unclear. Rumman Chowdhury of Humane Intelligence described the operation as "exactly the kind of governance gray zone where safety becomes a convenient cover for anticompetitive practices," noting that Meta kept the project secret and has not shared its findings publicly. Contractors, meanwhile, were left rattled: "Everyone I knew who worked on this project was completely gobsmacked by some of the text they were asking us to test."

On Friday afternoon, Anthropic received a government order at 5:21 p.m. ET instructing it to immediately suspend all access to its newly launched Fable 5 and Mythos 5 models "by any foreign national, whether inside or outside the United States, including foreign national Anthropic employees." Rather than attempt to surgically restrict access, Anthropic disabled the models for all customers to ensure compliance — just days after trumpeting the models as state-of-the-art across industry benchmarks.

Anthropic said the government provided no specific details about its national security concern, and the company pushed back publicly, stating the action did not adhere to principles of transparency, fairness, or technical grounding. The episode is the latest in an ongoing feud with the U.S. government: the Department of Defense previously declared Anthropic a supply chain risk — a designation historically reserved for foreign adversaries — and Anthropic is currently suing the Trump administration to reverse that blacklisting.

Devin Kim, one of xAI's earliest hires and now president of the nonprofit Center for AI Safety, filed suit in California state court claiming he was wrongfully terminated in retaliation for pushing safety guardrails on Grok. According to the lawsuit, xAI co-founder Jimmy Ba fired Kim last September — abruptly, and just before Kim was scheduled to present on AI safety to company leadership. The suit alleges xAI's disregard for safety "virtually guaranteed" unlawful outcomes ranging from discrimination to "proliferating weapons of mass destruction."

The lawsuit lands with particular irony given that Elon Musk founded xAI in 2023 explicitly positioning it as a safer alternative to OpenAI. A jury rejected Musk's related lawsuit against OpenAI last month. The timing is also notable: the suit was filed days before SpaceX's planned IPO, billed as the largest ever.

Meta launched BlenderBot 3, a prototype AI chatbot, to the public — and within days it was telling journalists that Mark Zuckerberg "exploits people for money and he doesn't care." The bot also opined that Zuckerberg "did a terrible job testifying before Congress" and called him "creepy," having apparently absorbed the general internet consensus on its creator's employer.

Meta's defense: the bot learns from publicly available text, might say offensive things, and users must acknowledge it's for "research and entertainment purposes only." The real reason Meta released it anyway? They need training data from real conversations. Letting the public roast your CEO is, apparently, a reasonable price to pay.