Same AI, Opposite Verdicts: The Transatlantic Copyright Split | Music Row Dealmakers

The AI copyright war isn't just an American story. In this Music Row Dealmakers special Gavel Drop episode, entertainment attorney Barry Neil Shrum breaks down two landmark November 2025 European rulings that went in opposite directions — and what they signal for the music you make.

We cover:
 • Munich's GEMA v. OpenAI — the first major European ruling holding an AI developer liable for memorizing and reproducing song lyrics
 • London's Getty v. Stability AI — an AI-company win that turned on jurisdiction, not a broad blessing of AI training
 • Why the two systems split — and why Europe has no U.S.-style fair use
 • The EU AI Act's training-data disclosure rules and why they're a game-changer
 • My forecast for the GEMA v. Suno case and a widening transatlantic gap
 
 This is general information, not legal advice.
 
 CHAPTERS
 00:00 Welcome
 01:30 Why borders matter for your rights
 02:15 Munich: GEMA beats OpenAI
 04:00 London: Getty vs. Stability
 05:30 Why the two split
 06:45 The EU AI Act game-changer
 08:00 Predicting GEMA v. Suno
 09:15 Takeaways + wrap
 

Questions? Call 877-7-DEALMAKERS or email questions@musicrowdealmakers.com
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 Our firm: https://ShrumDisney.com

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#MusicLaw #AICopyright #MusicRowDealmakers #EntertainmentLaw #IntellectualProperty 

GEMA v OpenAI, AI copyright, AI music lawsuit, ChatGPT lyrics, EU copyright, Munich Regional Court, Getty v Stability, Stable Diffusion, EU AI Act, text and data mining, Suno lawsuit, GEMA v Suno, fair use, music law, entertainment law, copyright infringement, Barry Neil Shrum, Music Row Dealmakers, Gavel Drop, music publishing, songwriter rights, AI and music, transatlantic copyright

Transcript

Introduction

SPEAKER_00 0:19

Welcome back, deal makers. I'm Barry Neil Schrum, founding partner of Schrum Disney and Associates. And this is Gavel Drop. Coming up in today's Gavel Drop, a court in Munich just handed down what very well may be the most important AI and music-related ruling in the world so far. And great news, it's a loss for the machine for AI. First real verdict of its kind in Europe. And the songwriters came out on top. Congratulations. Before I drop the gravel, uh gavel, I'd love to hear from you. Leave us a message at 877-7 DealMakers. That's 877-7 D-E-A-L-M-A-K-E-R-S. Or email us questions at musicrowdealmakers.com. Love to work your questions into a future show. And do me a favor, do us a favor, Dennis and I, uh hit subscribe and share this episode and help us grow the room. So welcome to Gavel Drop, where I take the biggest court decisions and give you the final word, what happened, what it means, and where I come down on it. No hedging, no legalese, the rulings in, and so is my take. Now,

The GEMA Ruling - Training AI on Music Catalog is Infringing

SPEAKER_00 1:40

last week, on July 31st, the last day of the month, a German court ruled that training and generating AI music on copyrighted songs recordings without a license is infringement. Now let me repeat that because that's not the way it's going so far in the US in Europe. Training AI, the learning language model on and generating output from unlicensed music, music used without permission, is copyright infringement. Let me set the scene. Let me talk about the story and

Setting the Scene: Why it Matters

SPEAKER_00 2:25

why it matters, because you you may very well be wondering, and I would be, why a songwriter on Music Row should care anything about a courtroom in Bavaria, where they wear fancy robes and court dress in court. No, they don't wear the white uh wigs, but they do wear the fancy dresses. Here's the matchup. On one side, we have GEMA. That's uh Germany's biggest collection society, collecting society. That's roughly equivalent to what what we call the performance rights organizations who collect performance royalties, ASCAP, BMI, CSAC, and its ILK, or the Music Licensing Collective, collecting, uh, of course, streaming uh royalties. GEMA represents composers, songwriters, and publishers, much like ASCAP and BMI. On the other site is Suno. Now we all know who Suno is. It's the U.S. company behind one of the most popular type of prompt, get a song kind of AI music generators. So Gemma sued Suno in Munich, arguing that it trains its models on their members' songs without permission and without paying a dime. On July 31st, the Munich Regional Court agreed. And why it matters? This is the first time a European court has answered this question that everybody, everyone in our business, the music business, is asking. Can you feed the world's catalog of music into an AI model for free? And just call it progress. Munich said no. Let me walk you through it. Gemma put six specific

What GEMA Proved In Court: Reproduction without permission is INFRINGEMENT

SPEAKER_00 4:11

specific compositions in front of the court. Recognizable German hits. And I'm going to butcher the heck out of these things, but I'll give it a shot. Helene Fisher's Teamlos Deutsch di Noche. And believe it or not, Mambo number five. I can get that one. And their lawyers didn't just say trust us, it it copied. They generated outputs from Suno during the trial and showed the court that those outputs matched the original melody, harmony, and rhythm. Now, that's the whole ballgame because Suno's defense in these cases is always the same, and particularly in the U.S. We don't store your song, we don't copy your song, the model just learns patterns, kind of like a student studying for a test, right? And the court didn't buy that here. The judges leaned on a concept called memorization. The idea is that when a model doesn't just learn general style, but it actually retains chunks of the original work, and it can spit those chunks back out. And that's no longer an abstract kind of learning or a technological kind of learning. That's making a copy. And anywhere in the world, making a copy of a copyrighted song is illegal, is infringement. It is a reproduction. And specifically under German copyright law, section 16 of their U Little R H G, making that copy is reproduction, much like it is here in the U.S. And reproduction without a license is infringement, the court said. Full

Suno's Problem: Infringing Input in, Infringing Output Out

SPEAKER_00 6:00

stop. Gabble drop. And so that is important. So it's a two-sided problem for Suno. The song goes in on the training side, and a near perfect copy comes out on the generation side. Very simple. Input and output. And critically, the court rejected SUNO's big shield to date, the text and data mining exception. Now, for those of us in the U.S., that's Europeans, the European cousin of our uh fair use in Section 107, very similar. The court essentially says that you don't get a free pass to ingest a commercial catalog in order to build competing product, particularly commercial product. So what does what does Sono actually do? Well, three things. One, it has to stop. An injunction against reproducing those works and against using them to train was issued. Two, open the books, disclose the revenue tied to those songs, and three, paid damages with the number to be set after that disclosure. So the bill is coming. We just don't know what size it is yet. It could be as large as that 1.8 billion verdict we saw uh last week in the bookcase. So the hot take here, where I come down, here's my take, and I'll say it plainly. This is the right call, right? This is defending creators' rights. We could use more judges like this in the U.S. For two years. The AI companies have been running the same playbook. Take first, license never, and dare the rights holders to catch up. And that's what's been happening here in the U.S. Now, Munich just planted a flag that says the catalog isn't a free buffet. Memorization is reproduction, is a clean and honest way to think about it. Memorization is reproduction. If the model, the AI model can hand me back a teamlos, the model has a copy of a teamlos. Now, let me be fair about this and give you the counterarguments because I like to do that. This

Caveats

SPEAKER_00 8:26

is the first instance or instance decision from one court in one country. The first glance at this issue in this country. Sunel has already said it disagrees with the holding, of course, and it's looking very hard at an appeal to a higher court. And a higher German court could narrow it. They have appellate courts much like the U.S. does. And secondly, it does not bind any court in the United States. However, it sort of predicts the weather, it sort of sets the tone, introduces and floats this idea out there. And so there's a real policy worry on the other side. If every training set, every learning language model needs a license for every work, copyrighted work that they've stolen, that they've scoured from the internet without permission on the basis that it's fair use. The concern is that only the biggest players can afford to build. And AI music ossifies around a few licensed giants. Fair enough. But my answer

"IT'S TOO EXPENSIVE TO LICENSE" is NOT a DEFENSE - ala Napster

SPEAKER_00 9:37

to that is it's expensive to do it legally, has never been a defense for using someone else's work without paying. Remember the old Napster days? That was their exact argument, and that's the same argument they're making now. The market can absolutely build licensing rails. It just has to want to do that. And notice this is now GEMA's second Transic Linux AI win. The pressure is building, not easing. A German verdict doesn't decide American cases, but it changes the tone of the argument. It changes the talking points. Every rights holder's lawyer on the planet is reading this opinion. So what's the music role

Relevance to Music Row Songwriters: Predicting the Future Fights against SUNO

SPEAKER_00 10:27

angle? And that's the piece for you, because the American version of this fight is very much alive. Right here at home, you've got Sony, Universal, and all of the labels squaring off against Suno in federal court in Boston. That'll be the first big test in the U.S. of whether training AI on sound recordings is fair use. So this Gemma case may very well be a bellwether. But pump the brakes a little bit because we're not expecting a ruling in that Boston case this summer or anytime soon. The Boston schedule got pushed. Fact discovery now runs into the fall, and dispositive motions aren't going to be due. That means motions to dismiss until 2027. So the U.S. answer may be coming, but it's not coming next week. Munich is just a preview. Boston is the main events, event for us here on Music Row and in the U.S. So keep your eyes there and keep your eyes, keep your station tuned here to us. We will drop the verdict as soon as the gavel drops. So

Walk Aways and Wrap Up

SPEAKER_00 11:42

what do you do? What do you actually do with this information once you hear it? Four quick things. One, if you're a rights holder, the ruling is leverage. Register your works, make sure they're copyrighted, stay affiliated with your PRO and all your collection societies because organized catalogs are what made this case winnable. Two, if you're a creator, using tools like Suno commercially, understand you may be building on contested ground. Remember that you do not own what AI creates. Read the terms of services. There was a case recently where a lot of YouTube creators lost their content because they had agreed to the terms of service that said it belonged to YouTube and they could use it. So, third, if you if you license or administer catalog, AI training rights are now a term you negotiate on purpose, not an afterthought. And four, document everything. And I always tell my copyright classes this document your creation, where the kernel came from, where the idea came from. If an AI output sounds like your song, capture it, date it, save the prompt. Evidence like that is exactly what won the case. Disclaimer, remember everything I give you is general information. It's not legal advice here. If you want that, give us a call, look us up on shromdisney.com or call some other entertainment lawyer license in your jurisdiction. Man, that's the gavel drop for today. Thank you guys for listening. Um the rulings in, the mic is dropped. Um if you want to me to break down a case for you, leave me a message at 8777 DealMakers or email questions to questions at musicprodealmakers.com. You're gonna find every episode of MusicRowl Dealmakers at that LS MusicRowDealmakers.com. Subscribe, share, and I'll see you next time. I'm on the Srum, MusicRowl Dealmaker. I'm closing the closing