Good morning, AI enthusiast.

Major Hollywood studios are taking AI image generator Midjourney to court. Disney and NBCUniversal have filed a lawsuit alleging the platform is built on the unauthorized use of their most famous characters.

The lawsuit directly challenges the "fair use" assumption that has allowed generative AI to flourish. Will this case set a new legal precedent, potentially upending the way all AI models are trained and commercialized?

In today’s AI recap:

• Hollywood's lawsuit against Midjourney

• OpenAI's new o3-pro reasoning engine

• Runway’s conversational video editing mode

Hollywood's AI Copyright War

The Recap: In a landmark legal battle, Disney and NBCUniversal are suing AI image generator Midjourney, accusing the platform of being a "bottomless pit of plagiarism" for using iconic characters without permission.

Unpacked:

• The lawsuit alleges Midjourney allows users to blatantly incorporate and copy famous characters like Darth Vader and the Minions, functioning as a "virtual vending machine" for infringing content.

• With over 20 million users and having reportedly made $300 million last year, Midjourney represents a major financial target in the creative industry's pushback against generative AI.

• This suit is the first from major Hollywood studios and directly challenges one of the AI industry’s fundamental assumptions: that training models on copyrighted internet data is protected by the "fair use" doctrine.

Bottom line: This case represents a pivotal moment in the battle over AI and intellectual property. Its outcome could reshape the legal landscape, potentially forcing AI companies to retrain models on licensed data and accelerating a market for ethically sourced AI.

Behind The Curtain

How We Created This Newsletter

The Recap: We just posted about how we built a data scraping pipeline and use a series of prompts inside an n8n workflow to generate every edition of this newsletter — The Recap AI.

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OpenAI's New Reasoning Engine

The Recap: OpenAI has launched o3-pro, its most powerful reasoning engine, for ChatGPT Pro and Team users, pairing enhanced performance with significant price cuts across its o3 model family.

Unpacked:

• The new model demonstrates major performance boosts in technical fields, outperforming its predecessors in benchmarks for PhD-level science, competitive math, and advanced programming tasks.

• Alongside the launch, OpenAI slashed API prices for its standard o3 model by 80% and doubled the message limits for Plus subscribers, making its top-tier models more accessible for builders.

• Early testers suggest the best way to leverage o3-pro is to treat it like a report generator, providing it with extensive context and a clear goal to unlock its full potential for deep analysis.

Bottom line: By making its best reasoning model cheaper and more available, OpenAI is accelerating the adoption of advanced AI for complex problem-solving. Unlocking its true value will require users to shift from simple chatting to providing deep, task-specific context.

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Runway's Conversational AI

The Recap: Video generation platform Runway is teasing a new "Chat Mode" that lets creators generate and edit video simply by talking to the AI, a feature already gaining attention for its impressive new capabilities.

Unpacked:

• Instead of single prompts, creators use natural language to direct the AI through a series of edits, like creating a casino heist montage from a reference image and a few instructions.

• The new mode helps maintain visual consistency across multiple clips, turning a single image into a coherent sequence of shots for a scene.

• A powerful new workflow allows users to save entire sessions or "genres," letting them apply the same style and process to a completely new character or image later on.

Bottom line: This shifts video creation from a command-based process to a collaborative conversation with an AI partner. The new approach dramatically speeds up complex editing workflows and lowers the barrier for high-quality video production.

The Shortlist

NVIDIA unveiled its first AI Blueprint for telco network configuration, using customized LLMs and agentic AI to automate network optimization processes and reduce operational costs.

Resemble AI introduced Chatterbox, a production-grade, open-source text-to-speech model that it claims outperforms leading closed-source systems and includes unique emotion exaggeration controls.

Microsoft patched a critical "zero-click" vulnerability in Microsoft 365 Copilot, dubbed EchoLeak, which could have allowed attackers to exfiltrate sensitive data from a user’s connected services by sending a specially crafted email.

Astronomers trained a neural network with millions of black hole simulations, enabling it to analyze previously discarded Event Horizon Telescope data to reveal new characteristics of the Sagittarius A* black hole.

Signing off,

David, Lucas, Mitchell — The Recap editorial team