On with Kara Swisher - Big Tech’s Litigation Era

Episode Date: August 20, 2026

There's a lot going on across the tech, media and legal landscape, from the potential $111 billion Paramount-Warner Bros. merger, to landmark social media addiction rulings and a series of even bigger upcoming trials.  Eriq Gardner is a founding partner and national correspondent at Puck who mostly writes about legal affairs. He joins Kara to unpack some of the biggest stories on his beat, including the latest on California Attorney General Rob Bonta's 12-state antitrust lawsuit against Paramount, the politics behind the deal and whether a settlement is imminent.  Kara and Eriq also discuss what, if anything, could put the brakes on President Trump's many defamation cases against media companies. Plus, they look at why publishers pursue litigation against some AI companies even while they're making content-licensing agreements with others.  Questions? Comments? Email us at [e-mail] or find us on YouTube, Instagram, TikTok, Threads, and Bluesky @onwithkaraswisher. Come see Kara for a live taping of On at the Odoo Experience conference in San Francisco on September 2. Register for the conference on Odoo's website. Learn more about your ad choices. Visit podcastchoices.com/adchoices

This is the time of litigation against tech companies coming forward. I've never seen so much activity in so many different areas. So lawyers will always have a job, as always. Hopefully I'll have one too. You will. Hi, everyone from New York Magazine and the Vox Media Podcast Network. This is on with Kara Swisher, and I'm Kara Swisher. Today, we're talking about all things tech, media, and legal with Eric Gardner.

He's the founding partner and national correspondent at Puck, who mostly writes about legal affairs, and I am surprisingly a legal walk, and I read him all the time. He's an expert on these issues, and he'll be our guide as we cover some of the biggest stories on his beat, starting with the latest on the proposed $11 billion Paramount Warner Brothers merger. Back in February, Paramount Skynd's CEO David Ellison won the bidding war to acquire Warner Brothers, and it's been chaos ever since. The deal is currently on hold, as Ellison faces an antitrust lawsuit brought by California and 11 other states, plus a lawsuit from the Writers Guild of America. A trial date has been set for next March, and the stakes are high. Among other things, Paramount

could have to pay $650 million per quarter in a so-called ticking fees if the deal isn't wrapped up by September 30th of this year. In the latest development that broke after we taped on Monday, Paramount has asked the 12 states and the Writers Guild to post a nearly $1.9 billion, bond. That's money Paramount would collect if the states lose the case, and the company wants it to cover the ticking fee. We also look at the politics behind WarnerMount and Larry and David Ellison's relationship with President Trump. Then we get into FCC Chairman Brendan Carr's ongoing battle with Disney. After we tape, Disney's ABC sued the FCC, alleging it has, quote, waged a retaliatory campaign against the network and violated its First Amendment rights.

Earlier this year, the FCC launched a probe into the talk show The View. It later called for an early review of licenses for Disney's local ABC stations. And finally, we'll wrap up with a discussion about AI copyright litigation and the landmark social media addiction rulings and a series of even bigger upcoming trials. This is a really interesting time. There's so many legal issues, but they all point to people wanting to sue tech. Obviously, the Ellison's are in tech, obviously open AI. all these companies are facing a lot more pushback on a lot of issues when before they sailed through, largely because Congress did not do its duty and create guardrail regulation that was adequate to control them.

And now you're seeing this through the courts. And so Eric is a great person to talk to right now. Our expert question comes from Democratic FCC Commissioner Anna Gomez. Lots to get to today, but it's also fun. So stick around. I promise law is fun. One more thing before we get into it. I'm going to be doing a live taping of On at the Odo Experience Conference in San Francisco on September 2nd. You can register for the conference on their website. We'll drop the link in the description for this episode. Two and five Canadians will hear the words, you have cancer. That's why every step and dollar raised matters.

On September 19th, join thousands in Toronto for the Princess Margaret Cancer Foundation walk. Challenge yourself, friends, and family to walk 21 kilometers. in support of life-saving research. Together, we can carry the fire and help create a world free from the fear of cancer. Register today at pmcf walk.ca.ca. Our earliest childhood memories can feel so visceral.

I have this memory of my mother standing on the beach, you know, the wind whipping her hair and her jacket, calling into the wind with my siblings, out in the lake and the dam, you know, looming in the distance. But none of these memories were true. This week, Unexplained It to Me from Vox. Why can't I remember being a baby? Credit scores.

We love them because they can qualify us to buy a house or get an apartment. And we hate them because they can seem irrational and confusing. I'm Vivian 2, Your Rich BFF, and on this episode of Net Worth and Chill, we're looking into where these scores came from, how to get and maintain a good one, and how to make them work for you. Ready to impress some lenders and make your credit score work hard? Listen wherever you get your podcasts or watch on YouTube.com slash your rich BFF. Eric, thanks for coming on on.

Thanks for having me. For people who don't know, I'm a huge fan of Eric's writing. I'm not a lawyer. I don't play one on TV. I don't do anything like that. But everything he writes, I didn't either know about or understanding quite the way. So I really appreciate your work. I appreciate that.

I'd love to know, like, how did you get started writing about legal issues on Puck? I've written about legal affairs, going back decades. And for a while, I thought about becoming a lawyer. But then I decided the last thing I wanted to be was a lawyer. I thought about maybe teaching law at a university or going into public policy. But what I really loved doing was writing. And to me, law was the ultimate way of getting a venue for which to write about. There's always drama involved.

And also, I feel like my one skill is puzzle solving. And law is a great place to go as a puzzle solver. A hundred percent. But let's start with the big case right now, the proposed Warner Mount merger, along with other mega mergers, have benefited considerably from Trump administration's friendly regulatory environment. But the deal is facing opposition, namely a lawsuit from 12 states. Given the landscape, how much runway is left in the consolidation wave?

And will Warner Mount be one of the last attempted media mergers, or do you expect we'll see more? And we'll talk specifically about Warner Mountain in a second. But overall, is this the high point of these things? You know, it wouldn't surprise me to see another year or two, especially as the Trump administration kind of winds down for some other media companies to try to sneak in under what they see as a favorable regulatory environment for clearing their mergers. Comcast has spun out. some of their assets and there's rumors that Universal could be up for sale, you know, Lions Gates up. I know that's not as big as Warner and Paramount, but I wouldn't be surprised to see a few more mergers. You never know whether the tech companies will try to swallow some of the entertainment ones or whether Netflix is still in the market. I mean, at one point they were about to buy Warner Bros.

So what's their next move? But, you know, overall, I would expect that in a few years this M&A frenzy to die down a bit. So let's get to Warner Mountain itself. I think a lot of people are surprised. I'm not so surprised given they're quite arrogant. They were quite arrogant in how they were wandering around the environment, up to having a dinner for Trump, which I think everyone was sort of gobsmatt. That's how arrogant they were.

So earlier this month, the federal judge set a March 2nd court day. This was after Paramount struck a deal to delay the closing until June. Last week, Paramount Chief Legal Officer, Macon, Delrahim, whom I know, just for people to full disclosure, told Politico that all options are on the table when negotiating a possible deal with AGs, and some took that to mean maybe selling CNN. But he wasn't specific. And California Attorney General Rob Bontas said to me that it's not about CNN. He said it, he reiterated it again this week. And Paramount supposedly said it's not on the table. I'm not sure what Macon was talking about. I don't want to talk about the sale of CNN. I don't think that's what the

biggest deal here is even though the paramount people would like to focus on it. David Ellison wrote an entire op-ed that said, I'd like to focus on CNN and then didn't or note anything that was going on in CBS. But talk a little bit about where we are right now. Yeah, I think there's a real antitrust case. I mean, you look at the complaint. CNN hardly comes up at all. Does politics at all animate this case, maybe? Yeah, you can't take away the context or the calculus and everything like that. These are blue states that are doing this. That's what their argument is. Yes, and I'm sure they have in mind, you know, like who CNN's going to wind up with, but that doesn't explain the fact that they went after Live Nation Ticketmaster or they intervened in all these other merger cases. Obviously, they have an antitrust theory.

They like to protect labor markets, and they have a real case involved. Is it the biggest slam dunk case? It is not. They are trying to slice and dice this marketplace in terms of blockbuster movies and, like, what? what is defined as a blockbuster or wide release. The market obviously is not the same as it was decades ago. Back in the 1980s and 1990s, it would be inconceivable that Warner Brothers and Paramount would merch. Those two companies had the largest share of the market. But we're not, you know, litigating what Hollywood as it was. We're litigating it as it is now. And there are,

you know, lots of other new companies out there, Netflix, and Amazon and Apple. And so Paramount probably has a good case to be made that the states are... Things have changed. Things have changed. I actually think that their economic case is better than their, you know, their PR case that this is all politics. But it's not a slam donkey in either direction. Especially around cable. Yeah. So let's take a step back and look at the lawsuit itself by Bonta and 11 other states, attorneys general, to block the merger. By the way, Paramount did not know it was this many. I can tell you that. And they also thought it wasn't going to happen for a little bit, which was interesting, you know, because they had one, all over the world. And they kept saying, we want all the world. I'm like, so what? Like, I was like, and? Like, it doesn't really matter. Like, a lot of it is it doesn't really matter.

The rest of the world is also analyzing something different. I mean, in the rest of the world, they're looking at distribution markets, whereas California is much more interested in production. And so is New York and New Jersey and others. So you described it as a fairly conventional antitrust challenge. You said it's notable, and this is from you, for what it embraces and what it avoids. For people who don't know, what exactly are they alleging in the overall strategy, and what did they leave out that was critical? Yeah, I mean, they basically alleged monopolization in three markets, two of them being related to theatrical and specifically wide-release ten-pult films, so blockbusters. And then the third is cable television, basically,

that they have enough, must-have cable networks that they have so much leverage over distributors, and they can exact high prices that. So prices for consumers. Right. The states will have to prove that they have not only enough of this market and it is a market and it's not forgetting important things like streaming, but also that there are bad competitive impacts to making this merger go through, you know, whether that means decreased output, decreased films, less jobs, that sort of thing.

And the other thing I want to point out here is that this isn't really just one case. it's actually two cases. And no one should forget the Writers Guild case because they are also suing and that case has mostly been consolidated. And even if the states decide at some point that they're going to settle, the Riders Guild still has a seat at the table and they will have an important voice to. So they don't have to settle. They don't have to settle.

And that's really what complicates. If there's one topic, I think people are kind of overlooking, it's that Riders Guild case. So their strategy is winning on at least one of these, correct? Yes. And they're quite discreet the choices they've made. Yeah, the states don't have to win on everything. They can win on one thing and win it all, right? But what's being left out, I would say, you know, from Paramount's perspective,

they say that the states haven't done a good job defining the market. They say, you know, look at these tent pulp films. You're counting in studios, but what does that not count? to count some of the biggest films out this year, backrooms, or Lions Gates Michael, that sort of thing. And so they can say, like, even with this kind of manipulated market thing, you say that we have 27% share of the market. Well, 27% is actually not that big. Usually the presumption of, you know, illegality comes after 30%. So even with the manipulated market, it's 27%. And then you get to the studios that were encountered and maybe that pushes it down to 20%.

And then you start talking about how the industry is changing. Artificial intelligence is coming up. The industry is shedding jobs. You know, theaters are hurting. And so maybe there's pro-competitive reasons for letting the merger come through. Now, I'm not saying I buy all this. Well, that's their new one if this takes too long. They shifted from their dumb stuff and this is their new one. I've noticed like, oh, if it takes too long, it'll hurt everyone. Well, guess what? Again, I was like, okay. And I didn't, I think I think it's there trying to push California into settlement. And one of their ways is brute force. Your colleague, Matt Bellany, reported last week that David Ellison confirmed his plan to move Paramount Skydance out of California to Tennessee, Texas, Georgia, another state. I think it's Tennessee is where he's looking at. That's what I understand, according to real estate people. If they don't reach a settlement, here's what Rob Bonta told me about Paramount Potential moving out of California on Pivot the day he filed the lawsuit last month. I mean, it feels like a potential monopolist trying to bully a state that is doing its job to regulate them. And it feels like a last ditch, you know, desperate effort to try to blackmail California and 11 other states into not enforcing antitrust law into allowing an illegal proposed merger to go through.

And that's not going to happen. It didn't work. We're not doing that. Why did he do that? There was some rumor that they're going to move with CNN. And also out of New York, you know, which was hair on fire there last week, I can tell you. What are these threats for? And first they started with the op-ads, and then you had Ari Emanuel.

It feels like he's going rogue for them. Then you had Chris Wallace inexplicably writing a piece. But the threat of leaving is, I think, their biggest move so far. Yeah, it's a leverage play. I mean, it's putting political crosswinds in there. I'm sure Rob Bata is going to hear from governorism. Yeah, California gubernatorial candidate Javier Bucera. I also said the party should settle, but he was unspecific. Paramount issue to press release,

pressing for settlement, earning the state of turn generals to, quote, engage in us with good faith. Talk about the bullying and then the please engage with us, sir, like that kind of thing. I think it only works for so long, right? You only have, you know, so many moves to be made. You put the threat out there. At some point, maybe they'll put their lot up for sale or maybe move their headquarters or something like that. But at some point, it stops having effect. And, you know, One of the things I might expect is that they will move on to something else, a different threat. Maybe they'll put out the fact that CNN could be sold and wind up in worse hands than their own. Elon.

Exactly, exactly. I think that's where we're going to go. Private equity acquiring CNN, Elon Musk acquiring CNN, really just getting Rabat to think, like, okay, well, maybe it's time that we come to a deal here and start negotiating. Well, that would be something. I think that would blow up in their face, I suppose, but maybe not. Maybe not. Do you think any of these work? Bont is already kind of won with the trial way out into March, correct? You don't have to win. You just have to get to March, essentially. Well, I think that getting to March was a big thing. The outside date on this merger is next June, right? And so, you know, putting it to March makes it really close to June. Who knows when the judge comes back with a decision, whether there's going to be a time to a appeal or not. I'm sure the judge will try to get her decision before June. It's possible that there could be some emergency appeals last second, but I'm sure Paramount would prefer to have the trial much sooner. They proposed November. So, yeah, but, you know, Bonta doesn't seem like he's in any rush to

negotiate. From a legal point of view, why would he, right? And Bonta has said he'd consider structural remedies to resolve the lawsuit, but dismiss behavioral remedies. You reference the live nation ticket master breakup case, an example of behavioral remedies ultimately. being inadequate. What does a settlement look like? And if not, I have said Paramount has to settle. There's just no other way around this, and soon, if they can. What do you think the settlement could look like and what something Bonta would accept and that Paramount was willing to do? I think the framework of a deal starts with a divestiture of some of their TV assets. CNN, or maybe broader than that, the Turner things, I think there would be kind of nice syllogism to the fact that, you

know like Turner, TBS, and CNN may have to be divested because that was exactly what the DOJ under Macon Delrahim tried to stop AT&T from buying a few years ago. Could there be some sort of structure where David Ellison holds onto a minority share and spins it off? I don't know, but I think that's where it starts. But that's not enough because it doesn't really get to the heart of the complaint, which is theatrical. I think that there would probably need to be some ways to ensure that Warner Brothers and Paramount remain independent studios run separately. I don't think it would be divestitures, but it would have to be some sort of, you know, board-level operational, Chinese-wallish sort of things.

I don't know precisely. On top of that, you layer in behavioral concessions. Jobs. Right. Right. This whole number of movies made seems insane. Like they could just put out like a cartoon, right? Yeah, yeah. So you start layering all this stuff together and you get to maybe the beginning

parameters of a deal. But even then, I start thinking, okay, well, then what does the Writers Guild need to settle their end of the case? Because remember, Paramount agreed not to close their merger until five days after a decision in both cases. So even if the states settle, then the Riders Guild are going to want something. And so maybe they want some sort of not just assurances over jobs, but maybe they try to like bring back FinCEN. Explain that what that is. They used to be, you know, back in the 70s and in early 80s before the Reagan administration, all these rules about distribution of content that you owned and produced. It's basically rules to manage vertical integration. And so if you're going to have a company that owns much of

the production lines like, you know, Warner Brothers and Paramount, and then they have this big platform like Paramount Plus and HBO Max, you need rules to establish that writers come in, talent comes in, and they can still get a piece of the back end. Especially independent productions, right? Yeah, they want the pipeline. They want to make sure that there's no foreclosure, as economists call it, where, you know, if you're an independent voice out there, there's still pipelines for you to get your product out there. So when you think about what's going forward here, there's also, obviously, the politics.

And David Ellison wrote a defense of the merger, and it says the issue, was whether I can be trusted as a steward of Warner's CNN. And there's been, quote, speculation. My politics. My loyalties. My intentions. He went on about it. But then, of course, he's been sucking up to Trump, rather a lot. So was his dad for years and years. His dad, you know, Larry Ellson didn't initially support Trump to be fair, but he gave roughly $45 million to a nonprofit supporting Trump's election. And David has given money to Democrats also. Talk about the political issue here. And now that possibly the Democrats are coming back to power, I'm hearing. from them. Like, they haven't even figured this one in, like the political elements. That's away

from the legal issues here, but it certainly counts, correct? Yeah. Actually, I don't think I blame David Ellison for this. I blame Trump more for this because he's the one who's kind of put this feeling out there that if you kiss the ring, you get approval. So they were just doing what kind of the message that was put out there to be on the good graces. And you could see why this like pissed off the Democratic establishment in the long run. It doesn't look good to have someone who, you know, your mergers before them, like in the same room together. And, and there used to be all these, you know, hard lines about independence of the Justice Department, and now there's not. And this is the price that gets paid. Now, some DOJ lawyers objected to this deal, and it went right through.

Yeah, there are career prosecutors. They're people who just, you know, work there. They are not political whatsoever. And they analyze it on the merits. And maybe they did analyze this deal and maybe this deal, you know, deserves to be approved. But the fact is that because the Trump administration has been paying favors to people and we saw what happened in the Live Nation case, there was a lot of lobbying there. And so, you know, people can't help but look at something and wonder, like, how much did politics play a part in it? And not law. Right. And so the perception kind of fuels the reality. So regardless of whether or not the deal was approved on its merits or not, there are suspicions out there.

Plus he said it. Plus he said it several times. I can't wait until it changes. There's rumors have gotten promises. Now, it also, by the way, people don't realize the deal also still requires FCC approval because Paramount holds licenses for local television stations. A recent pro-public investigation found that two out of three FCC commissioners, chairman Brendan Carr, whom I call a moron, and Commissioner Olivia trustee, whom I don't. I accepted luxury gifts from Paramount while FCC was reviewing or about to review major Paramount business decisions. Carr reportedly accepted honors gala tickets from CBS Paramount eight times since 2017, totaling over $75,000 in gifts. And it seems like the total value of the gifts might actually have been much more. Could anything come of these ethics complaints against these commissioners?

Is it a problem? So the FCC already approved Skydances control of the Paramount portion of it, and Paramount own CBS and all that. Warner doesn't actually have any licenses, but first of all, there are some like edge satellites in this and also as part of this process. There's some foreign money coming in. I don't expect the FCC to kick up a fuss, but this is a company that continues to do business with the FCC. And so if Brandon Carr wanted to put his foot in the gears of this and gliming it up, maybe he could, but I don't expect it. I think, you know, mainly right now, it's a court case, right? It's a court case. He just has to be gone, essentially. So where is your over and under on this, where it's going to go? I mean, it obviously isn't good that it's going to take until June. I assume there'll be a settlement because they're financially speaking. They're fucked if it keeps going, essentially. I mean, the economics collapse. If I had to put money on it, I would probably say that settlement too. I just can't imagine that this actually gets the trial. But I don't have the biggest conviction on it. If it did get the trial, I wouldn't be shocked. These are parties. that are really, you know, digging their hills in on some of this stuff. And, you know, I wouldn't want to play poker with Rob Huntup because it's hard to read him right now.

He seems like he's, like, going full tilt on this stuff. And then, as I said, the WGA has its own complicating factors. That's a really good point to me. But that being said, when I book my ticket to Oakland, it will be with the option to get a refund. With a refund, right. If the, yeah. Because just like with Justin Beldoni and Black Club,

They seem very angry until they settled, correct? Right. A lot of these things settle on the eve of trial. That's for sure. We'll be back in a minute. Support for the show comes from What Not. If you have an amazing product to sell, but aren't sure how to cut through the noise

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Hi, it's FCC, Commissioner Anna Gomez here. As a lone Democrat at the FCC, I've spent a lot of time thinking about what's happening to local broadcasting as a result of media consolidation. Eric, I've been following your reporting at Puck, and I wanted to ask this question to you directly. Local Broadcasting is going through a lot of change, and there's no shortage of ideas about how to help it survive and to stay competitive. For me, the priority is protecting localism, meaning real local journalism from stations rooted in their own communities. I don't think the answer is letting big national companies take over and call it local news. So what changes do you think could make local broadcasters stronger while keeping that local focus intact? Thanks, and I look forward to

your answer. Yeah, I mean, this is a great question, and I totally agree that local public broadcasting is quite important and special and really just, you know, taken for granted. And I wish I knew the answer to this. What I do know, though, is that Brendan Carr's solution of just lifting ownership caps and letting the Sinclair's and next stars of the world kind of take over everything, defunding PBS and NPR, The solutions don't exactly seem to me like it's going to let that marketplace thrive. I would hope that there's lots of competition out there, that there's, I think we should cherish it. I really wish I had better answers for help. But talk about the case of Disney and the FCC going forward.

Yeah, I mean, what Brandon Carr is doing, he's just like basically, you know, censorship regime right here. You know, it doesn't like a joke. This is Jimmy Kimmel. He puts their licenses up for review. It's trying to kind of reinvigorate the fairness doctrine, which honestly was something that the Reagan administration decided that couldn't stand the test of time. So on the merits, I don't think that the FCC, I don't think Brendan Carr has much of a case. I think that the courts will agree with Disney on this, but there's a cost to just having this float out there and hanging over. for Disney's head and having this in hearing and taking discovery and all that. And I think that's

basically what Brendan Carr is after is basically just to keep a dark cloud on this. And I don't think that this is particularly healthy because in the long run, the Democrats will retake power and they will try the same things towards Fox and towards Next Star and Sinclair. And so it's just not a great cycle. I mean, on the merits, the thing is so disastrous. I just wonder if it's some sort of like Trojan horse for getting rid of the FCC altogether. I mean, it just doesn't make much sense. I think he's surprised Disney's fighting back so hard. Is he surprised that Disney's fighting back so hard?

I don't know. I think he loves the attention. He thinks he's ambitious. And the fact that Disney fights it makes him look good in front of Trump. Like it makes him seem like he's doing something. Ultimately, he's not going to cancel Disney's license. I don't see that happening. Disney will win this one.

So let's shift to another topic speaking of President Trump, the defamation cases that you cover, as you call them, one of his favorite pastimes. The non-profit watchdog citizens for responsibility and ethics in Washington reports that Trump has filed lawsuits and claims demanding over $70 billion since the second term candidacy announcements. Some of the more recent targets include the BBC, the New York Times, and the Wall Street Journal. You recently wrote about the legal argument that may put the breaks on Trump's many defamation cases. I mean, he's after everything. Like, there's one against how. the Pulitzer Committee awarded their prizes. I mean, a lawsuit against the Wall Street Journal and his friend, Rupert Murdoch, over a birthday letter to Jeffrey Epstein, on and on. I mean, it's just ridiculous. I mean, like, these lawsuits are, you know, terrible. What might put the brakes on this? I mean, better policing, I think, of jurisdiction. Right now, he's filing everything in Florida because he sees that it's a favorable place for him. anti-SLP laws that make him pay if he loses, make him pay the opposing side's legal costs, tighter gatekeeping by judges at the front end of things. Those are things that I don't know would stop them. I don't think anything's going to stop him. But you wrote about the unitary executive theory

and how it could actually prevent Trump from filing more lawsuits. Yeah, there's some theory out there that as president, because he's part of the government, that if you can't sue an officer in the government for deferring, for defamation, they're immune, that it should go both ways, where as long as you're, you know, you have an office of the government, you can't really sue in your individual capacity and therefore you should be, you know, forbidden from basically suing. So there's some, you know, thoughts out there that could be one of the defenses that's next tested. Unfortunately,

I don't think that that would be resolved before he gets out of office. So it might affect Don Jr. more than Don Sr. You also noted that the media outlets and the reporters should consider going on the offense in libel cases more often. This seems counter to make a case for that. Well, a couple things. First of all, I don't think that there's anyone who is, you know, under the bleeding gun like those in the media. I mean, our reputations are attacked. There's the suggestion that all we're doing is biased reporting, making up facts.

This is libel per se. I think that there is like a case to be made that journalists, can, it should be collecting damages sometimes for kind of like the worst criticisms of their work. The other thing I think is that these libel laws and libel defenses are seen as kind of gifts to the media when really it's a First Amendment defense. That's a gift to everyone. And people have forgotten that. And I think that by putting some of the critics of the media on the defensive, it might remind everyone, might remind courts about, you know, why we have some of these defenses. So, I think that one of the ways that people who defend the media should be thinking more is going on the offense, litigate our reputation as much as our legal rights.

What would that entail from a legal perspective? That would mean suing. If someone suggests that you made up a story to advance your career, it would mean, you know, putting that person in the defensive seat of the courtroom and, you know, trying to collect damages there. Look, I don't think that it's appropriate in all circumstances for journalists. it would open the door maybe to discovery of who their sources are. And so as a journalist, you have to be careful about those instances, and there are lots of considerations. But I think generally there might be more instances where journalists start thinking about going on the offense. And I don't know. To me, the CBS case was the perfect example. And of course, they were sort of pressured into selling

it to finish the deal that this was the 60 Minutes editing. And I know some of the people involved And, you know, the executive settled, but the people quit over saying, I'm sorry, refused to say I'm sorry, which was their only ability to protect themselves, I think. But they couldn't control the company from settling. Yeah, I mean, a lot of people in, I'm sure a lot of newsrooms have been under the gun with, you know, suggestions like this. And so, yeah, I wouldn't surprise me. So punching back is your, punching back. Punching back legally. He's a classic bully, isn't he?

Punch him in the nose and he backs off. We'll be back in a minute. Two and five Canadians will hear the words you have cancer. That's why every step and dollar raised matters. On September 19th, join thousands in Toronto for the Princess Margaret Cancer Foundation walk. Challenge yourself, friends, and family to walk 21 kilometers in support of life-saving research. Together, we can carry the fire and help create a world free from the fear of cancer. Register today at P.

MCFWalk.ca. Kara here. The other day I saw a picture of Minnesota Lynx coach Cheryl Reeve, courtside. She was wearing a t-shirt that read Trans Kids Belong. I think this was an epic move, and I have so much respect for that.

Go, Cheryl. This week, Cheryl, is on Megan Rapino's new podcast. Why are you like this? Megan asked Cheryl, why her t-shirts are more than just a fashion statement. There's just so many things that we could really champion for women. and other marginalized groups.

And I just heard from so many people what it meant to them. And so we've continued that. The conversation with Megan gets into why Cheryl is the WNBA goat from being one of the first openly gay coaches in the WNBA to standing with her players during Black Lives Matter. She also recently became the winningest coach in WNBA history. You should check it out. Why are you like this wherever you get your podcasts and on YouTube?

Megan Rapino here. This week on Why Are You Like This, I got to sit down with legendary Minnesota Lynx coach Cheryl Reeve in Chicago during All-Star Weekend. We get into her personal style of activism, how she supports her players as people, and why she proudly considers herself a dyke. Then we learn if she's more of a mommy, daddy, or baby. Check out the latest episode of Why Are You Like This, wherever you get your podcast and on YouTube. Let's shift to copyright litigation against AI companies, starting with Disney. December, Disney announced a $1 billion investment in OpenAAA, allowing SORA. It's now a defunct video tool to use Disney characters.

Disney didn't move forward with the investment after OpenAI pulled a plug-onsor earlier this year. Talk about these approaches to AI and the licensing first. What does it tell you about it? SORA, by the way, was not very good for anyone who saw it. And I thought this investment was purely a marketing announcement that would go nowhere. But OpenA. has made several content licensing deals with major publishers, including News Corp and Axel Springer, the New York Times. has ongoing lawsuits, though, against Open Air and Microsoft and perplexity.

And when I asked New York Times CEO Meredith Koppett Levian about the lawsuits and why some publisher making deals with AI firms, she pointed to New York Times content licensing deal with Amazon and said they're absolutely open to it. So talk a little bit about these cases and where they're going for publishers, especially the disjointed way publishers are working through their issues. And by the way, just this week, we have the Hollywood Studios making a deal with TikTok's owner and by dance and over AI and all that. So a lot of times that there are threats made and there's settlements and they call them licensing, but it's really like the settlement of potential litigation.

And the other thing I would point out is that these feed into each other because when you go into copyright litigation against AI companies, one of things that gets analyzed when the question of like, is this fair use is, well, what's the market? Is the market being harmed? And if you can say, well, yeah, there's a big licensing market for training AI and, you know, all these other companies have made deals, but this company has not. That's powerful evidence. So it doesn't surprise me to see the publishers make deals. Also, it's big money. I mean, like, this is like a line item for open AI and allow these companies to do these licensing deals.

But for the publishers, they're in a business that's tough. Why are they so disjointed? And is the lawsuit an effective way? such as the New York Times lawsuit, an effective way to do that. I mean, it's kind of a carrot and stick approach. If you don't make a deal with us, you know, we're going to sue you. I mean, that's a time-tested approach to doing these sort of deals, especially in copyright matters.

Yeah, well, legal threats are settlement talks. But I also think that, you know, a lot of this stuff is really new. And so it's hard to kind of figure out what licensing parameters should be. For instance, you know, you could say that the New York Times should sell with Open AI and maybe Open AI wants to do it, but, you know, from Open AI's perspective, is the New York Times about the same as any other publisher? Because we might think of the New York Times as being prestigious and more influential in how we appreciate the news. But when it comes to training data, the weights might be different. And so, you know, a lot of this license.

activity is very complicated and how it's approached. And again, it's all over the place. Yeah, I mean, all the AI companies have ensued. Why New York Times is picking on Open AI in particular, I mean, I think has to do with, you know, they were the most visible company in the space. It was the path towards the big ticket damages. It was more of a text chat bot versus other AI systems, which were more visual in nature. There are a lot of different factors, but I think that New York Times has a few lawsuits out there, not just against Open AI.

Right now, I think we're talking about somewhere between 80 and 100 lawsuits in total. Yeah, no, none of these AI copyright cases have made it to trial in the U.S. yet, though. And last month, Anthropic reached a $1.5 billion settlement with authors who accused the company using pirated books to train its clawed chatbot. It works out to $3,000 per book they stole. Should we expect more settlements? Or will any go to trial? Both. I think that there will be lots of settlements.

And what's the difference? Whether or not it goes to trial or not. Trials are big. The stakes are large. Juries get involved. You know, it will be influential in how the next generation perceives these legal threats, how seriously they take them. I think that the exposure is something that a lot of the tech companies, you know, want to avoid.

But at some point, they are going to take their chances. they're going to look at the demand and say that's just unreasonable. Like YouTube did. Yeah, we like the fact pattern here, and we're going to take this as the test case. I think that, you know, some of these cases are nearing the summary judgment phase and what the judges decide will be influential in the calculus about whether to take it to trial. Also, keep in mind that it isn't just binary. It isn't like, you know, is training legal versus is training illegal? It's where did you acquire the data in the first place?

How do you warehouse the data? How are you weighting your models? What does the output look like? And these AI companies can win on four of the five of the issues and then lose on the fifth issue and decide that that's the issue that they want to take up. Meanwhile, we have at least one case, the Westlaw case, which has to do with legal headnotes and all that.

That's on appeal right now in the Third Circuit. it could maybe get to the Supreme Court next year. There are going to be things like Supreme Court decisions that impact the calculus on whether it goes to trial. I expect that we will see at least one trial in 2027. Of a big one. One of the things that reminds me during the YouTube days, when I was covering Google in the early days,

I was around when they did the book stuff. They just tired them out. They tired the publishers out, ultimately, and got what they wanted. And I'll never forget walking around Google with Larry Page, and they had a room full of televisions. They were taping all of television to get close captions searching, and they didn't have any deals with any of the television companies. You just did it. Yeah. And the other thing I would point out is that, you know, the plaintiffs have to decide to deal, too.

For instance, you know, you talk about that $1.5 billion deal that Anthropic made with book offers. But some book authors, like John Carreou, and they didn't want to take the deal. They don't want to take the $3,000. And so they opted out of the settlement, and they're pursuing their own claims right now. So how do you settle with them? Right. And so maybe those will be the cases that end up at trial. But then you have to go through them.

Their theory is to tire you out with all their money, right, that they will ultimately beat you down. That's what happened with YouTube. It really did. They cheated until they didn't cheat. And then, you know, everyone's happier now. I guess same things with Napster. You know, it's kind of their patented way. Let's go to the most important thing for me, social media addiction litigation and a new lawsuit against Netflix, by the way.

Section 230, broadly speaking, protects platforms for being held liable for content posted by their users as long been the focal point of legal theories about the responsibilities of these platforms. But now plaintiffs are succeeding in addiction litigation against Meta and YouTube with a different tag product design liability. It's at the center of another landmark trial against Mehta that began this week, which is quite troublesome, I think. talk about this legal strategy and your thoughts on it. We'll get to how it's expanding beyond social media company at the moment. Yeah, let me put it this way. I mean, there are ways in which I feel comfortable with what's going on and other ways that make me uncomfortable. And when you think about, you know, social media and the way it's given to the users, you can think of it two ways. One is it's like a cigarette. It's compulsive. It's addictive. It harms you. And

that's, you know, basically what all these plaintiffs are trying to show that, you know, the playbook kind of rhymes with the old nuisance suits against tobacco makers. Right, which took a long time for people. On the other hand, the social media companies, they do have some benefits. It is speech. And I guess the question is, is it like, you know, those rap albums from the 1980s that Tipper Gort tried to ban, you know. And so even stuff like algorithms is just editorial. curation in, you know, digital form. And so the question is, how much of this do we see as product design and how much of this do we see its speech? And when we look and we break down the features like infinite scroll or autoplay or notifications, does that go more towards design elements

or does that go more towards editorial curation and how a newspaper decides what goes in the op-ed page or a parade organizer, decide who marches with you. And so these are tough questions, and we're, you know, getting to these trials. Where do you see it heading? Obviously, public opinion is against these companies. It's moving very heavily against it. And, you know, they are signed by Section 230, which I doubt will be overturned. It would be disaster from a, it would be the Lawyer Employment Act of all time. If they overturned Section 230, it's almost impossible to do so from what I understand from various experts. What is the move?

Product liability has to be the move. Although Section 230 is not going away and isn't being repealed, there was an important decision by the Ninth Circuit a couple of weeks ago that says that basically it's not immunity. It's a defense. So that means that these cases against tech companies, against social media companies, will continue to flow. There will be these product design and nuisance suits that put a huge amount on the line.

The case that's beginning this week in Oakland, the one that's being brought by a few states against META, I mean, they want, I think, $1.4 trillion, which is the market cap of META. They want structured changes to how the platforms run. And so I see a lot of these cases ticking on. There'll be appeals. There'll certainly be some settlements as well. But this is going to be in the background for years and years to come. Years ago, I interviewed Mark Meneoff, and he said they're like cigarette companies.

He's changed not that particular opinion, but when you think about that did take a long time. And ultimately it didn't kill the cigarette companies, but it certainly put them in a line of decline, right? It seems to me that a lot of this, especially around the lawsuits around data centers around this, is all of the same feeling of these people need some rules. Yeah, I would say that there are a lot of similarities, but there are also some differences, and we should keep in mind the differences, too. cigarettes were addictive and they hurt everyone who touched them. As far as social media goes, I think some people are, you know, are okay with using social media and some people bear the brunt of it. You know, some features are probably good for society to have and other features are not.

So, you know, it's easy to take a look at this stuff and say at large, oh, you know, the tech companies, they're all evil and they should all go away. It's not exactly go away. It's, let's see some controls, right? Right, right. And so that's the answer to it. Like age verification, things like that. Like, let's have some rules, which you have none of.

Right. There should be disclosures, common sense rules, stuff like age gating, if they, you know, can think of it and make it reasonable. I don't see why they would resist it. At some point, hopefully we'll get to a point where some of the, this stuff can exist without constant litigation, but we're not at that point yet. That's because they wouldn't cooperate in the first place. They wouldn't do anything in the first place. But in May, this is an interesting case, which is related, Texas Attorney General Ken Paxson filed a lawsuit against Netflix, alleging the streamer is spying on users, including

children, profiting from their data and using, quote, dark patterns to keep kids engaged. What's Netflix's defense here? It's a broader issue and the limits of the product liability argument when it's applied to a streamer, because this could go a lot of directions. Well, first of all, Netflix's response is that Ken Paxton doesn't know what the hell he's talking about. He doesn't understand the system or it's just junk science in his complaint. But pushing past that. The point that I've made is that there's not a huge jump to be made moving from social media to how digital entertainment operates. We're still talking about algorithms and deciding which content gets first on your scroll, what gets recommended to you. So if you're going to make the case that

Facebook or Instagram is addictive, someone can easily make the case that Netflix is doing the same thing. Or peacock or whoever. Right. I guess their response would be, well, this is even more connected to speech. There's even broader First Amendment considerations here. We're not just pushing third-party speech out there and organizing stuff. We're actually pretty our own content and all that. And if you stop us, you're really endangering the First Amendment. You're giving the state the ability to control what you see. And so the First Amendment implications are pretty broad here.

Is that the same thing with Facebook, the defenses they should have? Or where they're in these, I'm using Facebook overall because it's a bunch of different product liability losses, including with kids and chatbots. Yeah, I certainly think that Facebook has. their First Amendment defense that they're pushing. It's not just Section 230. They are saying that this is our speech, which is, it's kind of funny. Like, in some ways, they say it's someone else's speech, but it's also our speech. And so, yeah, I mean, courts have to deal with that. And that's something that's going to come up at the trial in the next few weeks. It's going to come up

and the appeals down the line. I love this, this is very unsettled. I mean, the Supreme Court nods to this a few years ago. In, you know, some of their cases, they were like, well, if the algorithm is doing the heavy lifting here, is it actually speech or is it not? And that's a question that really hasn't been settled yet. And that ultimately these cases do go to the Supreme Court, presumably. Oh, yeah. Correct, all of them. Which is the one you think makes them most vulnerable? Probably this one kicking off this week. Oh, yeah. I mean, there's also one in Tennessee that's going on right now. But yeah, this case, I mean, it's hard to be the trillion-dollar case

that has these stakes, but just behind it, there's a case brought by a consolidate school districts around the nation. There are cases against other social media companies. TikTok was smart enough to try to sell out its way of the California one, but it's just going to go on and on. And now that the plaintiff's bar have found product design as, you know, a way to at least be 230 on the front end of things, not have their cases quickly dismissed, it incentivizes them to come up with similar theory. This is like money to be made here. What is the Tennessee case?

Tennessee is a nuisance case, similar kind of thing, which I think that they're going to be caught in litigation. This is not good for them. By the way, for people who don't know, Netflix has also been hit by a number of high-profile defamation lawsuits for shows, including Baby Rindeer when they see us and inventing Anna, the last two were settled. But Netflix's defamation case when making shows about real people.

Is that a plaintiff's attorney opportunity? Not really. I mean, the funny thing, most people don't realize this, but if you add up all the defamation lawsuits from like Fox News and New York Times, those are symbolically important, but Netflix is the defendant in more cases than any of them. Why? Because they love this, the docu-drama fictionalization of true events. Basically, they say, okay, we're going to take something that actually happened but make up stuff. And once you get that, it collides with an area of law, which, you know, makes it tough to say false things about people. So if you identify, identify a docketrama and it's about you and telling audiences stuff that you didn't actually do and harms your reputation. Yeah, they're going to sue over it. And so Netflix finds themselves in an incredible amount of a number of these cases. And some of them they've won, but others they've struggled with. And so they're making lots of interesting law on this topic. I see them as probably like the most important libel defendants going these days. Really? Interesting. All right. So we've covered a lot of ground today, but looking ahead, what do you think will be the most consequential cases, stories in the next year in media that people should pay attention to or should be paying more attention to? If you pick out tech, media, you know, any of these, because you write about so many esoteric cases, too, that suddenly you make me think are actually really important, including ownership of people who've died, things like that. Is there any cases that you're like, hey, this is going to matter? that are completely under the rate. Or ones that you think are the most important one. I think that competition is a big issue these days

in just so many different kinds of forms, whether it's the challenge to a merger or a challenge to the way that non-competes work in the workplace. Even these copyright cases against the AI are essentially competition cases. Copyright gives you an exclusive right to leverage your own works, your creative authorship. It's supposed to incentivize you to create,

and here are, you know, these tech companies out there saying you can't have a monopoly over this stuff like journalism. And so, you know, I think all this is important. And is there any unusual case do you think is coming that people should pay attention to? I'm always on the lookout for these unusual cases. I think, you know, the Justin Baldoni thing settled, but that was a kind of unusual. Yeah, it was a fun one. It had to do with how PR works and how employment works and you kind of post Me Too. era and yeah, speech in its kind of purist form and like whether you can complain about the

powers that be and whether the repercussions there. I think that that was incredibly useful. This has been really interesting. Eric, I will keep reading your stuff and look for more strange and weird cases. But I do think, you're correctness, this is the time of litigation against tech companies coming forward. I've never seen so much activity in so many different areas. So lawyers will always have a job, as always. Hopefully, I'll have one too. You will. Anyway, thank you so much. My pleasure. Today's show was produced by Nashat Kerwa, Michelle Eloy, Catherine Millsop, Megan Burney, Madeline LaPlante Duvie, and Kaylin Lynch. Special thanks to Dave Shaw, Lisa Soap, Eamon, Jim Mackle, and Manolo Moreno. Our engineers are Fernando

Aruta and Rick Juan, and our theme music is by Tracademics. If you're already following the show, may all your mergers and acquisitions be forever blessed. If not, you're stuck with a $650 million quarterly ticking fee. Go wherever you listen to a podcast search for On with Carous Swisher and hit follow. Thanks for listening to On with Carous Swisher from Podium Media, New York Magazine, the Vox Media Podcast Network, and us. We'll be back on Monday with more. Two and five Canadians will hear the words, you have cancer.

That's why every step and dollar raised matters. On September 19th, join thousands in Toronto for the Princess Margaret Cancer Foundation Walk. Challenge yourself, friends, and family to walk 21 kilometers in support of life-saving research. Together, we can carry the fire and help create a world free from the fear of cancer. Register today at pmcfwalk.ca.ca.