Perplexity is escalating its legal row with the publishers of The Wall Street Journal and New York Post, telling a federal judge they are refusing to hand over their search histories on the AI startup’s platform.
Perplexity, which was last valued at $20 billion, said in a motion filed February 24 in the US District Court for the Southern District of New York that Dow Jones “cherry-picked” responses from Perplexity’s internet search engine to support its copyright lawsuit.
News Corp.’s Dow Jones and the New York Post sued the startup in 2024, alleging that it copied their content without permission or compensation to feed its search engine. Perplexity’s tool responds to user prompts with direct answers pieced together from trusted webpages, rather than just a list of links.
The dispute marks the latest escalation in the legal battles between AI companies and traditional publishers over who owns and profits from the internet’s content. At stake is whether AI search engines like Perplexity’s can legally ingest and summarize paywalled reporting without compensating the content owner.
Exposing an ‘inconvenient truth’
Dow Jones and the Post argue that Perplexity’s search engine will, at times, repeat their articles verbatim, which hurts their ability to sell ads and subscriptions for high-quality news.
In its latest filing, Perplexity claims that Dow Jones users effectively badgered the search engine to reproduce paywalled articles, and that the publishers are not complying with document requests because doing so would expose an “inconvenient truth.”
Perplexity’s motion said it asked the publishers during discovery to provide all exchanges where the user tried to prompt its tool to repeat articles word-for-word or summarize them. The company argues the publishers have refused to turn over such exchanges.
Perplexity purports to be able to read them anyway. Perplexity’s terms of service allow the company to “remove, screen, edit, or delete” user prompts for any reason, and without notice.
Perplexity says it has identified hundreds of prompts the publishers submitted to its search engine that “were clear attempts to induce copyright-infringing answers,” the motion read.
The motion described one exchange where the user asked Perplexity about the substance of a Wall Street Journal article. When the search engine summarized it, the user asked it to provide the first paragraph, then retype two paragraphs verbatim. Perplexity said its tool declined to do so. In one case, Perplexity said the user hit the “retry” button more than 50 times, calling it “a clear effort to ‘break’ the system.”
News Corp. and Dow Jones did not immediately respond to requests for comment sent early Monday. A spokesperson for Perplexity declined to comment.
Dow Jones and the Post filed their own motion on Monday, asking the judge to order Perplexity to search for and deliver documents related to how the company collects web content, and documents concerning how it attracts users and keeps them on the platform.
Perplexity’s request to dismiss the lawsuit for lack of jurisdiction or improper venue was previously denied.
Perplexity has pitched itself as a new front door to the internet — a Google alternative for the chatbot era. That promise has attracted investors willing to price the company like a market winner. In a matter of months last year, Perplexity grew its valuation from $8 billion to $20 billion.
Against that backdrop, Perplexity is also rethinking how it makes money. Executives told reporters this month that the company is backing away from ads and betting on subscriptions and business customers instead.
Perplexity’s back-to-back funding rounds have drawn whispers of “bubble,” and at an industry event in November, investors voted it the billion-dollar startup most likely to flop. The company now has to prove it can turn its search engine into durable revenue — while fighting publishers who argue the product depends on their reporting to function at all.
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