Udio argues AI training is fair use

AI music company Udio has contested Sony Music's lawsuit, arguing in a New York court that its use of recordings to train generative AI models constitutes fair use. The company filed its legal answer on August 27 in the US District Court for the Southern District of New York.

Udio's filing states that any copying of protected material was 'quintessential fair use.' The document argues that Udio's AI tool uses a back-end technological process, invisible to the public, in the service of creating an ultimately non-infringing new product.

Sony Music Entertainment and nine affiliated labels sued Udio on July 20, alleging the AI company copied many of the major's sound recordings. This is a separate case from an earlier lawsuit involving 333 works, which a judge decided to keep separate on June 29.

Sony is seeking statutory damages of up to $150,000 for each recording it claims was infringed. For the recordings identified, this creates a theoretical maximum liability exceeding $4.5 billion. Udio's filing proposes a drastically different figure.

To the extent Plaintiffs establish any act of infringement, that infringement was innocent, allowing for the Court to reduce any award of statutory damages to an amount as low as $200 per work infringed, the company states. At that rate, liability for the same number of works would be just over $6 million.

The new lawsuit from Sony brings three primary claims. It alleges Udio copied recordings released after 1972, copied older recordings, and circumvented YouTube's technical protections via stream ripping.

Udio denies all claims. The company argues Sony has suffered no provable injury from the alleged copying. It also contends Sony cannot bring the YouTube circumvention claim because the labels are not persons injured by the alleged act.

On the YouTube allegations specifically, Udio's answer restates admissions it made in April. Udio admits that it obtained audio data from YouTube for use as training data, the filing states, adding that it acquired some of its training data by utilizing YT-DLP.

However, Udio does not concede it ever trained its model on the specific recordings Sony identified. The company says it lacks knowledge or information sufficient to form a belief as to the truth of Plaintiffs' representations regarding an investigation conducted by content identification company Audible Magic.

Sony is now the only major music company that has not settled with Udio and signed a licensing agreement. Udio's filing confirms it has settled with Universal Music Group and Warner Music Group, and that those agreements include licensing terms.

It says the same of its deals with Merlin, Kobalt, Believe, and the National Music Publishers' Association. Universal Music Group settled and struck a licensing deal with Udio in October 2025, with Warner following in November.

The filing also confirms that certain Sony plaintiffs have had access to Udio's source code and training data since March 20, 2025, as part of discovery in the original case. They have accessed Udio's source code and training data numerous times in a controlled environment in secured rooms located within the office of Udio's outside counsel.

Separately, Udio accuses Sony of misusing its market power. On information and belief, Plaintiffs have engaged in anticompetitive activities that extend an unlawful monopoly over the production and commercialization of music, the filing reads.

The answer also confirms that Udio has partnered with Audible Magic to watermark Udio outputs and to create guardrails to prevent users from uploading content to Udio that they do not own. Udio announced that partnership in April 2025.

Udio is asking the court to dismiss all of Sony's claims permanently and to order the major to cover its legal costs. The company also disputes that every one of Sony's claims can be put to a jury. The filing concludes by stating that Udio denies that Plaintiffs are entitled to the requested relief, or to any relief whatsoever.