The so-called “magnificent seven” are leading the US economy. In 2023, Yahoo Finance reported that they had gained 71% while the other 493 companies in the S&P 500 trailed by a considerable margin. Despite their name, the magnificent seven do not represent the top seven companies in the index. Analysts group NVIDIA, Apple, Meta, Facebook, Amazon, Microsoft, and Google together because they all operate in the tech industry. However, these seven companies also have something else in common – they constantly face lawsuits from a wide range of sources. At any given moment in time, all seven corporations are probably being sued. Today is no different – and these lawsuits highlight some of the most important legal challenges for tech companies today.

NVIDIA Sued for Alleged Copyright Infringement

On March 11, 2024, Reuters reported that NVIDIA was being sued for alleged copyright infringement. The chip maker is perhaps the hottest name in technology today, and its performance in the stock market has been nothing short of legendary. It seems that lawsuits are unavoidable consequences of greater notoriety and success. Three authors say that their chips were used to power artificial intelligence programs that stole their copyrighted books without permission.

The AI program in question is “NeMo,” which apparently accessed a dataset of 196,640 books to train itself. According to the lawsuit, Nvidia admitted to using this dataset to train the AI. Nvidia has declined to comment on the litigation, but it is not the first AI company to face such allegations. OpenAI’s ChatGPT accessed similar books online – apparently without permission – during its training process. Today, numerous writers have filed similar lawsuits against AI companies. Even the New York Times has joined this surge of copyright infringement lawsuits. It is worth noting that even though this story has proven controversial, the announcement of the lawsuit did not affect NVIDIA’s share price in the slightest.

 Apple, Google, and Tesla Escape Child Labor Allegations

On March 5, 2024, CNN announced that a federal appeals court had dismissed a lawsuit against Apple, Google, and Tesla for alleged child labor in Congo. These companies had been accused of using child labor to mine cobalt in the Democratic Republic of Congo, although the DC Circuit Court of Appeals found that their actions could not be defined as “participating” in the illegal practice. The court also found that the companies did not own any controlling interests in the child labor cobalt mines. However, one judge admitted that children were being forced to work in order to meet the cobalt demands of these tech companies.

Cobalt is becoming one of the most in-demand rare earth minerals in the world, as it is a crucial component of lithium-ion batteries. These are integral in smartphones, tablets, and – perhaps most notably – EVs. The lawsuit was initially filed by a human rights group called International Rights Advocates, and although these tech companies escaped consequences on this occasion, this controversial issue could arise once again in the near future.

Microsoft Compares OpenAI to VCRs in Effort to Beat OpenAI Lawsuit

Microsoft recently employed a very interesting strategy when responding to the aforementioned AI lawsuit filed by the New York Times. Since OpenAI has essentially become a subsidiary of Microsoft (which has led to a separate lawsuit filed by Elon Musk), Microsoft now has a clear incentive to defend ChatGPT in court. Their defense strategy involves comparing ChatGPT to an old-fashioned VCR.

Microsoft’s lawyers point out that a few decades ago, the movie industry felt that VCR technology would completely bankrupt them. People could suddenly watch movies from the comfort of their own homes, and there was no longer any need to visit the cinema. Microsoft’s lawyers point out that ChatGPT isn’t all that different. Specifically, they argued:

 “Despite The Times’s contentions, copyright law is no more an obstacle to the LLM [large language model] than it was to the VCR (or the player piano, copy machine, personal computer, Internet, or search engine).”

Huawei Resolves Amazon Lawsuits with New Licensing Deal

 For some time now, Huawei has been suing Amazon in Germany for the alleged use of patented video playback and WiFi tech. On March 6th, however, the Chinese tech company agreed on a multi-year deal to license its patented tech to Amazon. Huawei’s head of intellectual property admitted that it has faced numerous challenges ever since being sanctioned in the United States, but this latest move signals a willingness to work alongside US companies in jurisdictions outside of America.

Meta Sues After Alleged Corporate Espionage

On March 12, 2024, Meta sued a former Facebook executive for allegedly stealing confidential documents after being terminated. The executive apparently used these confidential documents to benefit a new AI cloud computing startup within days of leaving. Meta claims that this constitutes a blatant breach of contract, stating that these documents were “proprietary, highly sensitive, confidential, and non-public.”

This lawsuit also seems to involve “poaching” high-performing Facebook employees and luring them to the new AI startup. After the executive left the company, eight employees followed in his wake and joined his new organization. Some of the documents he allegedly “stole” included detailed information about Facebook’s top-performing workers. The implications are quite serious, and the employee is apparently demanding a jury trial.

Find a Qualified Tech Lawyer Near You

If you have been searching for a qualified tech lawyer near you, look no further than John P. O’Brien. With a wealth of experience in technology law, we have helped numerous organizations overcome various legal challenges. While the magnificent seven may face lawsuits that only multi-billion-dollar tech companies encounter, the same general lessons apply to smaller organizations. More importantly, lawsuits that involve the magnificent seven tend to set precedents that change the path of technology law in the United States. We keep a close eye on the latest developments in this space and provide you with the most up-to-date legal advice. Book your consultation today to get started with an effective action plan.