Via searchenginejournal.com
A federal judge lets Reddit's DMCA claims proceed, putting AI data scraping practices under serious legal pressure
A federal judge handed Reddit a meaningful legal win on July 31, 2026, largely denying a motion to dismiss from web scraping service SerpApi. The ruling means Reddit’s core claims under the Digital Millennium Copyright Act move forward.
What the court actually decided #
US District Judge Paul A. Engelmayer, sitting in the Southern District of New York, ruled that Reddit had plausibly pleaded a conspiracy between SerpApi and Perplexity AI. The alleged arrangement: SerpApi provided a product capable of circumventing Google’s access controls, and Perplexity AI paid for it.
Reddit argues that instead of scraping Reddit directly, Perplexity routed its data collection through Google search results, using SerpApi as the technical middleman. The effect, Reddit claims, was industrial-scale harvesting of hundreds of billions of search results containing user posts and comments for AI training, without a licensing agreement or a dollar changing hands to Reddit.
The lawsuit was originally filed on October 22, 2025. Beyond SerpApi and Perplexity AI, Reddit’s complaint names Oxylabs UAB and AWMProxy as additional defendants.
Reddit says the unauthorized activity cost it real money, specifically in lost licensing revenue and the operational expense of building new security measures to defend its content. The company is seeking both damages and injunctive relief.
The Google subplot adds a twist #
Just eleven days before Engelmayer denied SerpApi’s dismissal motion, a separate DMCA lawsuit filed by Google against SerpApi was dismissed on July 20, 2026. The reason: lack of standing, meaning Google couldn’t demonstrate it was the right party to bring that particular claim.
Reddit’s case survived on the merits of its pleading, which is a meaningfully different result from Google’s case failing on a procedural technicality.
Why this matters for AI companies #
Reddit went public in March 2024 and has since leaned heavily into data licensing as a core revenue strategy, signing licensing agreements with several AI firms. A successful lawsuit outcome reinforces that argument and gives Reddit leverage in future licensing negotiations.
Perplexity AI, which is privately held, has faced a string of copyright-related accusations over the past year. Reddit’s stock performance and its ability to grow licensing revenue are now partially tied to how this litigation resolves.
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