Hank's IP Brew — Issue #30

Howdy, y'all.

This week: the Trump administration just told a federal court that AI companies should be able to train on your work without asking — and a college football showcase figured out how to pay two dozen players $6 million before kickoff. One story about who the government is protecting. One about what happens when athlete NIL deals collide with big-money, off-campus showcase games.

Let's get into it.

On September 2, the Trump Justice Department filed a statement of interest in the New York Times v. OpenAI case — one of the largest consolidated copyright lawsuits in history, involving the Times, the Chicago Tribune, Florida and Arkansas newspapers, The Intercept, and a long list of authors including Ta-Nehisi Coates and George R.R. Martin.

The DOJ's position, stated plainly: training AI on copyrighted works is fair use, and any court ruling that says otherwise threatens national security.

That last part is not hyperbole. The filing actually says it.

What the DOJ filed

The government submitted a 20-page statement of interest — not a party to the lawsuit, but an official federal position on how copyright law should be interpreted. The DOJ argued that the process of training a large language model on copyrighted text should be analyzed separately from what the model outputs. Training, the government says, is transformative fair use because it "uses copyrighted work not to duplicate the work's expressive content, but as part of a process to learn and act on statistical patterns in written text."

The filing was explicit about the stakes: "The United States has a strong interest in continuing to develop a robust and competitive artificial intelligence industry that sets the standard for the practice and procedure of AI use globally." And then, remarkably: "Rules of law that make it significantly more difficult to develop a robust AI industry in the United States therefore threaten national security and give a competitive advantage to foreign adversaries."

In other words: if copyright law protects creators from having their work ingested without permission, that's a national security problem.

What this means for the case

A statement of interest doesn't bind the court, but it's not nothing. Federal courts take seriously the government's stated interest in how a legal question gets resolved. This filing puts a thumb on the scale toward OpenAI's fair use defense, and it signals that the administration is not going to be a neutral bystander as AI copyright law gets made case by case.

The NYT case had already survived OpenAI's motion to dismiss — the court ruled the publishers' claims could proceed. But the DOJ's filing now frames the next phase of the litigation as not just a dispute between a newspaper and a tech company, but as a conflict between creator rights and American AI competitiveness.

The Times responded sharply: "The Administration is siding with a handful of trillion-dollar AI companies at the expense of the countless American creators whose work they stole." And: "Both AI and creators can thrive — AI companies simply need to pay fairly for the content that makes their products possible, as copyright law requires."

The practical reality for creators

Here's what this week's filing means in plain terms: the federal government has formally argued that if you created text, music, code, or other expressive work — and an AI company ingested it to train a model — that ingestion is probably not infringement. You may have no claim. And the government's reason isn't that your work wasn't valuable. It's that the alternative is bad for America's AI industry.

That is a significant policy choice, and it's being made through litigation, not legislation.

The argument that training and output should be analyzed separately is not frivolous — courts have sometimes distinguished between what goes in and what comes out. But it's also a framework that, if adopted broadly, essentially tells every creator that their existing copyright doesn't protect their work from being used as training data.

The Bartz/Anthropic settlement — which we covered in Issue 27 — resolved one major case with a $1.5 billion payout and a requirement that Anthropic destroy the pirated files. That settlement suggests AI companies know there's real liability risk. The DOJ's move this week is an attempt to reduce that risk going forward, not retroactively.

Watch this case. The DOJ's position will be contested. Publishers and authors will push back hard. But the government just made clear which side of the line it intends to stand on.

College football has historically barred players from receiving direct event payouts for playing in off-campus showcase games. That changed on September 5.

The Aflac Kickoff Game — Auburn vs. Baylor at Mercedes-Benz Stadium in Atlanta — became the first time a neutral-site college football game (a matchup hosted at an independent NFL stadium rather than either school's campus) built NIL compensation directly into its operational model. Peach Bowl, Inc., which operates the game, partnered with third-party entities to distribute roughly $6 million among up to 24 Auburn players in exchange for marketing commitments and promotional appearances tied to the game.

The deal ran from July through kickoff. Players posted on social media, made public appearances, participated in advertisements and in-game promotions, gave media interviews, and appeared in signage and branding. And — critically — a portion of the payout was tied directly to ticket sales. Auburn received an allotment of 20,645 tickets as the designated home team. Players had a financial stake in how many people showed up.

Why this is structurally new

Standard NIL deals are endorsements: a brand pays an athlete to promote its product. What Peach Bowl Inc. built here is different in a few ways.

First, the organizer — not a brand, not a collective, not a booster — is the entity structuring the NIL arrangement. Bowl games and neutral-site game operators are now a distinct NIL deal channel, with their own interests (filling seats, generating media coverage, keeping schools willing to participate) and their own capacity to route money to athletes through third parties.

Second, the revenue-share component creates something resembling a profit interest. Athletes aren't just being paid for their name and likeness; they're being paid partly based on game-day revenue. That's a different legal and practical relationship than an endorsement, and it raises questions about how those payments are structured, taxed, and reported — and whether school compliance offices were fully in the loop on the revenue-share mechanics.

Third, the scale — $6 million distributed across 24 players — is large enough to matter individually. At $250,000 per player on average (the distribution wasn't disclosed publicly), this isn't a token gesture. It's meaningful NIL income structured around a single event.

What other organizers took away

CBS Sports reported that "other neutral-site organizers are watching." That's the part worth paying attention to. Labor Day weekend neutral-site showcases have been losing ground as schools prioritize valuable on-campus home schedules for College Football Playoff positioning. If a direct revenue share for players makes neutral-site participation more financially attractive, third-party stadium promoters have more leverage to keep top programs signing contracts.

Peach Bowl CEO David Epps called it "a potential game-changer for neutral-site games like ours who want to bring added value to participating teams and make it a more attractive and lucrative opportunity." That's a pitch to other schools as much as a description of what happened at Auburn.

What this means for athletes, agents, and advisors

The Aflac/Auburn deal is a proof of concept. It shows that game operators can structure NIL arrangements, that revenue-share components are viable, and that the scale can be significant. It also creates a new set of contract questions that parents, agents, and attorneys should be asking when a neutral-site invitation comes to a program.

Who is the counterparty — the game operator directly, or a third-party entity they've hired? What's the revenue-share formula and what data backs it up? How does it interact with existing school collective arrangements or individual endorsement deals? What are the tax implications of a payment tied to ticket-sale revenue? And — back to the question that drives everything in NIL right now — does the school's compliance office have sign-off?

The Aflac Kickoff Game answered the question of whether this can be done. Future neutral-site deals will answer whether it can be done cleanly.

See you next time,

Hank

P.S. If someone forwarded this to you and you find it useful, subscribe at newsletter.creatoripacademy.com. No spam, no filler — just IP news that actually matters.

About Hank's IP Brew

Creator IP Academy helps creators understand and protect their intellectual property. Got a question? Reply to this email.