Social media giant Meta Platforms (NASDAQ:META) has faced lawsuits before. States, nations, other companies…it’s nothing new for Meta to get sued. However, this time is a little more unique, as the source of this particular lawsuit is a collection of authors. Yes, authors. But shareholders aren’t exactly unhappy about the whole thing; Meta shares are up fractionally in Wednesday morning’s trading session.
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The lawsuit, which now includes filings from comedian Sarah Silverman and Michael Chabon, alleges that Meta Platforms used their work—without compensation, attribution, or consent—to train their Llama large-language model (LLM) system. Previous attempts by the group to file suit haven’t fared so well; part of the Silverman lawsuit was previously dismissed, and a judge in the case allowed other filers to rewrite portions of their own claims, likely to prevent the same fate.
A Pile of Potential Legal Calamity
Part of the latest complaint features dialogue between a researcher, Tim Dettmers, and Meta’s legal department about using a tool known as “The Pile.” But the legal department seemed to stunt any move in that direction, citing “legal reasons.” “The Pile,” specifically its “Books3” section, was a treasure trove of data, containing a reported 196,640 books. The primary issue—though this wasn’t specifically stated—seems to focus on those books with active copyrights. But certain individuals at the time seemed to believe that the use of such books would be permissible under “fair use” principles, a section of U.S. copyright law that protects—or at least should protect—certain uses of copyrighted material. Reports note, however, that Meta’s lawyers were of the mind that any model trained using that data would be unusable due to copyright issues.
What is the Fair Value of Meta Stock?
Turning to Wall Street, analysts have a Strong Buy consensus rating on META stock based on 37 Buys and one Hold assigned in the past three months, as indicated by the graphic below. After a 175% rally in its share price over the past year, the average META price target of $387.71 per share implies 15.9% upside potential.
