Will the SCOTUS hear a case about AI and copyright law before 2027?
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Will the SCOTUS hear a case about AI and copyright law before 2027?
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AI Analysis
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About This Event
Before 2027 If the Supreme Court grants a writ of certiorari to a case about AI and copyright law before Jan 1, 2027, then the market resolves to Yes. Early close condition: This market will close and expire early if the event occurs. This market will close and expire early if the event occurs.
What Prediction Markets Are Forecasting
Prediction markets give this roughly a 1 in 16 chance. That's a long shot. Traders on Kalshi are saying the Supreme Court almost certainly won't take up a flag burning case before January 2027. The market has hovered in the low single digits for a while now, which tells you this isn't a case of uncertainty, it's a case of "probably not happening."
Why the Market Sees It This Way
Flag burning cases haven't exactly been flooding the federal courts. The last major one, Texas v. Johnson in 1989, established that burning the American flag is protected political speech under the First Amendment. Then United States v. Eichman in 1990 struck down the federal Flag Protection Act. Since then, Congress has tried multiple times to pass a constitutional amendment banning flag desecration, but it's never gotten through both chambers.
For the Court to hear a new case, something has to change. Right now, there's no circuit split on the issue. All federal courts follow the 1989 precedent, and no state has passed a new flag desecration law that's survived even initial review. Without a conflict between lower courts, the Supreme Court rarely steps in. The current conservative majority hasn't shown much appetite for revisiting First Amendment speech protections, even for symbolic acts many find offensive.
There's also the timing issue. The Court takes maybe 60 to 70 cases a year out of thousands of petitions. Flag burning just isn't on the docket of pressing controversies. It's a settled area of law, and no one's pushing hard to unsettle it.
Key Dates and Events to Watch
The Court's certiorari grants happen in batches throughout the term, with the final ones typically announced in late June. If a case were going to be granted, we'd likely see it by spring 2026 at the latest to fit the timeline. Watch for any state legislature passing a new flag desecration statute designed to challenge Johnson directly. That would be the kind of deliberate lawmaking that could force the issue. Also watch for any major political movement around flag burning, since public pressure sometimes pushes states to test constitutional boundaries.
How Reliable Are These Predictions?
Prediction markets are generally solid at forecasting Supreme Court behavior, mostly because the Court is predictable. It moves slowly, follows precedent, and rarely takes cases without a clear reason. Markets have done reasonably well on similar questions about certiorari grants, though the sample size is small. The main limitation is that one unexpected event, a high-profile flag burning incident that goes viral, could shift political dynamics fast. But as of now, the market's caution looks reasonable. Sometimes the most likely outcome really is the boring one.
Current Market Outlook
Kalshi traders currently price a Supreme Court flag burning case at just 6% before January 1, 2027. That is a roughly 1-in-17 chance, which the market sees as possible but unlikely. The low price reflects both the Court's shrinking docket and the absence of an obvious vehicle case winding through lower courts right now.
The Supreme Court accepts only about 80 of the roughly 7,000 petitions filed each term, around 1%. Flag burning cases are rare because the Court settled the core constitutional question in 1989. In Texas v. Johnson, a 5-4 majority held that burning the American flag is protected political speech under the First Amendment. Congress responded with the Flag Protection Act of 1989, and the Court struck that down too in United States v. Eichman (1990).
Key Factors Driving the Odds
The 6% price reflects three realities. First, a constitutional amendment to ban flag desecration has passed the House multiple times but consistently dies in the Senate, most recently falling short in 2006 by one vote. Without new federal or state legislation, there is nothing for the Court to review.
Second, the current Court has shown little appetite for revisiting established First Amendment precedents on expressive conduct. The conservative majority has focused on guns, abortion, and administrative law, not symbolic speech.
Third, the Court's certiorari process requires a genuine circuit split or a direct challenge to existing precedent. No state has passed a flag desecration law since Eichman, and federal prosecutors have not pursued flag burning cases in decades.
What Could Change These Odds
A single event could shift this market dramatically. If a high-profile flag burning incident goes viral, state legislatures might rush to pass new statutes designed to test Johnson. Texas, Louisiana, and Oklahoma have all floated such bills in recent sessions.
The 2026 midterm elections matter too. If Republicans sweep Congress and the presidency, a constitutional amendment could pass and generate immediate litigation. The Court would then face pressure to hear a case testing whether Johnson should be overturned.
The early close condition means this market expires the moment certiorari is granted. Anyone buying at 6% is betting on a political firestorm, not legal evolution. The odds say that firestorm does not arrive before 2027.
AI-generated analysis based on market data. Not financial advice.
Overview
The question of whether the U.S. Supreme Court will hear a case about artificial intelligence and copyright law before January 1, 2027, centers on the intersection of generative AI and intellectual property rights. As AI systems like ChatGPT, Midjourney, and GitHub Copilot have become widely used, they have raised novel legal issues: whether training AI on copyrighted works constitutes infringement, whether AI-generated outputs are eligible for copyright protection, and who owns the rights to those outputs. These questions are currently working their way through lower courts, and the Supreme Court's decision to grant certiorari would signal a landmark ruling that could shape the future of AI development, creative industries, and the legal framework for machine learning. Interest in this topic has surged as several high-profile lawsuits have been filed by authors, artists, and publishers against AI companies. For example, in 2023, authors like Sarah Silverman and John Grisham sued OpenAI for using their books to train ChatGPT without permission. Getty Images sued Stability AI for allegedly copying millions of its images. These cases are at various stages of litigation, and some have been dismissed or allowed to proceed, creating a split among federal courts. Such splits often prompt the Supreme Court to step in to resolve conflicting interpretations of the law. Another strand involves the U.S. Copyright Office, which has issued guidance on AI-generated works, stating that purely AI-generated content without human authorship is not copyrightable. This position was tested in the case of Thaler v. Perlmutter, where the D.C. Circuit upheld the Copyright Office's refusal to register an AI-created image. That case has been appealed, and the Supreme Court could take it up to clarify the human authorship requirement under the Copyright Act. Why does this matter? The outcome of a Supreme Court ruling would have enormous economic and creative consequences. AI companies argue that fair use protects their training methods, while content creators seek compensation and control over their works. A ruling either way could either bolster the billion-dollar AI industry or require it to obtain licenses for training data, potentially reshaping business models. For the public, it could determine whether AI-generated art and writing enter the public domain or remain under copyright, influencing what we can freely use and share. The market's early close condition reflects the binary nature of the event: if the Court grants certiorari before 2027, the market resolves to Yes; otherwise, it resolves to No.
Historical Context
The U.S. Supreme Court has a long history of addressing copyright issues in the context of new technologies. In 1984, the Court ruled in Sony v. Universal that the VCR did not infringe copyright because it had substantial non-infringing uses, establishing the 'Betamax standard' for fair use. More recently, in 2015, the Court in American Broadcasting Cos. v. Aereo ruled that a service streaming broadcast TV over the internet was akin to a cable company and thus liable for copyright infringement. These cases show the Court's willingness to adapt copyright law to technological change, but also its caution in creating new exceptions without congressional action. The fair use doctrine itself has evolved through Supreme Court decisions. In 1994, Campbell v. Acuff-Rose Music established that commercial parody can be fair use, and in 2021, Google v. Oracle ruled that copying Java APIs was fair use. The latter case is particularly relevant to AI because it involved the copying of code for interoperability, a concept that AI companies argue applies to training data. However, the Court has not yet addressed the specific question of whether mass copying of copyrighted works for machine learning is transformative. In the lower courts, a split has emerged. In 2023, a federal judge dismissed most claims in a case brought by visual artists against Stability AI, Midjourney, and DeviantArt, ruling that the plaintiffs had not sufficiently shown direct infringement. However, in other cases, such as the Authors Guild v. OpenAI, courts have allowed claims of vicarious infringement to proceed. This split between courts on whether AI training is fair use or infringement is a classic trigger for Supreme Court review, as the Court often steps in to resolve circuit splits.
Why It Matters
The economic stakes are enormous. The generative AI market is projected to grow to $1.3 trillion by 2032, according to Bloomberg Intelligence, and much of that value depends on AI systems trained on vast amounts of copyrighted material. If the Supreme Court rules that such training is not fair use, AI companies would need to negotiate licenses with copyright holders, potentially costing billions of dollars and slowing innovation. Conversely, a ruling in favor of AI companies could devalue the works of authors, artists, and publishers, who would lose control over how their creations are used. Beyond economics, the ruling would affect the public's access to AI-generated content. If AI outputs are considered public domain, they could be freely used by anyone, but that might also mean they can be used for disinformation or propaganda without legal recourse. On the other hand, if AI outputs are copyrightable, the rights would likely vest in the human user who directs the AI, which could encourage creativity but also lead to a flood of low-quality, AI-generated works clogging copyright registrations. The decision will also influence international norms, as other countries look to the U.S. for guidance on AI and copyright.
Current Status
As of late 2025, the Supreme Court has not yet granted certiorari in any AI copyright case. The most likely candidate is Thaler v. Perlmutter, where the D.C. Circuit affirmed the Copyright Office's refusal to register an AI-generated image. Thaler's petition for certiorari was filed in early 2025, and the Court is expected to consider it in its conference in late 2025 or early 2026. Other cases, such as the Authors Guild v. OpenAI, are still in discovery and have not yet produced a final judgment that could be appealed. The Copyright Office has also been active, issuing a report in 2024 that recommended against new legislation on AI and copyright, preferring to rely on existing law. This stance may influence the Court's decision on whether to intervene, as the Court often defers to Congress when it appears to be actively considering legislation. However, with Congress showing no signs of passing AI copyright legislation, the Court may feel compelled to act.
Frequently Asked Questions
Will the Supreme Court hear a case about AI and copyright?
It is possible but not guaranteed. The Court receives over 7,000 petitions a year and grants certiorari to about 1%. However, the existence of a circuit split on AI copyright issues increases the chances, as the Court often steps in to resolve conflicting rulings.
What is the Thaler v. Perlmutter case about?
This case involves Stephen Thaler, who created an AI system called DABUS and sought to copyright an image generated by it. The Copyright Office refused, and the D.C. Circuit upheld that refusal, ruling that human authorship is required. Thaler has appealed to the Supreme Court.
Is AI-generated content copyrightable?
Under current U.S. Copyright Office guidance, purely AI-generated content without human creative input is not copyrightable. However, works that involve significant human involvement in the creation process may qualify. The Supreme Court could change this standard.
Educational content is AI-generated and sourced from Wikipedia. It should not be considered financial advice.
