Judge Thompson denied most of Stability AI’s motion so dismiss Getty Images’ Complaint.
The only that was dismissed was the DMCA CMI 1202(a) due to failure of allegations of intentional removal: “However, the four corners of the Complaint lack allegations to suggest a specific intent to induce, enable, facilitate, or conceal the infringement. Rather, the Complaint appears to concede that Stability AI’s models create distorted watermarks as incidental byproducts of their inherent overfitting or memorization during training processes. See id. ¶ 83. While Getty relies on several cases to support its proposition, those cases rely on Section 1202(b), which requires a different intent analysis. See Mango v. BuzzFeed, Inc., 970 F.3d 167 (2d Cir. 2020); Kadrey v. Meta Platforms, Inc., No. 23-cv- 03417-VC, 2025 WL 744032 (N.D. Cal. Mar. 7, 2025).”
The other claims survive:
- Getty’s trademark claim under 15 U.S.C. § 1114(1) (Claim III) is sufficiently alleged: “Getty also identified several instances in which users of Stable Diffusion reported that image output created a distorted version of Getty’s mark. Id. ¶¶ 84–87. Based on the four corners of the Complaint, it would be reasonable to assume that when consumers view images generated by Stable AI with the distorted Getty’s mark, they might be confused to some extent, which is sufficient to pass muster at this stage before a full review of the record.”
- Getty’s false designation of origin under 15 U.S.C. § 1125(a) (Claim IV) is not barred by Dastar: “Dastar applies to bar “reverse passing off” claims where the defendant distributes a plaintiff’s work without attributing it to the plaintiff, as opposed to “passing off” claims where the defendant distributes its own work without attributing that work to the plaintiff. See id at 27 n.1; 32–33; 36–38; Craigslist Inc. v. 3Taps Inc., 942 F. Supp. 2d 962, 978 (N.D. Cal. 2013); see also Advance Loc. Media LLC v. Cohere Inc., No. 25-cv-1305 (CM), 2025 WL 3171892, at *10 (S.D.N.Y. Nov. 13, 2025). Because Stability AI distributed images generated by their model that affixed distorted Getty watermarks without attribution to Getty, the Court finds that Getty’s claim in this instance constitutes a “passing off” claim.”
- Getty’s trademark dilution claims (Claims V and VII) survive: “The Court finds that Getty has met the burden of pleading that its mark attained “household” status under 15 U.S.C. § 1125(c)(2)(A) at this stage.”
- Getty’s California UCL claim (Claim VI) survives: “Getty alleges that Stability AI’s conduct results in an unfair advantage by using Getty’s marks in “competitive proximity” and misappropriating its reputation to compete with its visual assets. ECF 1 ¶¶ 127–28, 155. Moreover, the Complaint presents an extra element beyond the classic trademark or copyright law claim by alleging misrepresentation, where a substantial portion of Getty’s current and potential clients are likely to mistakenly believe that Stability AI is affiliated with Getty, which makes Getty’s claim qualitatively different from the federal law at issue.”
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