Suchir Balaji

This analysis applies the four-factor fair use test under U.S. copyright law to the outputs of generative AI systems, systematically evaluating whether products like ChatGPT and image generators satisfy the legal requirements for fair use of the copyrighted materials in their training data. The author examines each statutory factor: the purpose and character of the use, the nature of the copyrighted work, the amount of the original used, and the effect on the market for the original, arguing that major generative AI products fail on multiple factors. On the question of transformative purpose, the analysis contends that AI systems that generate text and images in direct competition with the original creators are not sufficiently transformative to merit fair use protection. The paper pays particular attention to the market impact factor, documenting how generative AI tools are already displacing human creators in commercial contexts ranging from stock photography to copywriting, providing evidence that these systems cause concrete economic harm to rights holders. The analysis contributes to an increasingly urgent legal debate as multiple copyright infringement cases against AI companies move through the courts, offering a structured framework that journalists, policymakers, and legal practitioners can use to evaluate the strength of fair use defenses in the generative AI context.