Suno's copyright loss, Reddit's scraping win, and Lilly's insulin probe: Litigation Tracker — Week of July 28
Six material litigation developments from July 28 through August 3, 2026, spanning AI copyright and privacy, Google's antitrust damages exposure, and pharma pricing and FDA-preemption disputes.
Coverage window: July 28–August 3, 2026. Six developments made the cut: two AI copyright rulings, a privacy injunction request against xAI, a fresh European damages signal for Google, and two pharma cases that draw different lines around pricing investigations and FDA preemption. None is a final answer to the underlying industry question. The useful information this week is where the courts are allowing the claims to move.
At a glance
| Case | Sector | Current stage | Why it matters | Next milestone |
|---|---|---|---|---|
| Reddit Inc. v. SerpApi LLC et al. | AI / copyright | Most of Perplexity's motion to dismiss denied; scraping and conspiracy claims continue | Tests whether a platform can use DMCA anti-circumvention theories to control access to public pages and data used for AI training | Discovery and merits proceedings; date not public 1 |
| GEMA v. Suno AI | AI / copyright | Munich Regional Court found copyright violations and ordered revenue disclosure | A European court has tied unauthorized music processing to both liability and financial disclosure, not just licensing negotiations | Possible appeal; damages still to be quantified 2 |
| Jess Asato v. xAI | AI / privacy and product regulation | Claimant seeks an order requiring permanent technical blocks on sexualized images of her | Puts model prompts, product design, and data-protection remedies in the same case | xAI response or an interim-relief hearing; date not public 3 |
| PriceRunner v. Google | Tech / antitrust | Stockholm court ordered Google to pay about $1.97 billion including interest | Converts a long-running public antitrust record into a private damages exposure and may encourage follow-on claims | Google's appeal; counsel expects the appeal to take more than a year 4 |
| Attorney General v. Eli Lilly and Company, No. 165961 | Pharma / drug pricing | Michigan Supreme Court reversed dismissal and remanded; the investigation may proceed | Rewrites the state's test for when a regulated company's conduct is "specifically authorized" and therefore outside the Consumer Protection Act | Circuit-court proceedings and investigative subpoenas; date not public 5 |
| Yousefzadeh et al. v. Johnson & Johnson Consumer et al., Nos. 24-3296 (L), 25-119 (CON) | Pharma / OTC drugs | Second Circuit affirmed in part, vacated in part, and remanded | "Maximum Strength" claims escaped express FDCA preemption even as most other state claims and a civil RICO claim failed | Proceedings on remand; date not public 6 |
AI sector cases
Reddit's scraping case survives the pleading stage
Parties. Reddit Inc. sued SerpApi LLC, Perplexity AI, Oxylabs, and AWMProxy in the Southern District of New York. The case is Reddit Inc. v. SerpApi LLC, No. 1:25-cv-08736. 1
Claims. Reddit alleges that the defendants scraped its data from billions of search results without permission and that Perplexity used the material to train an AI-powered search engine. The complaint also alleges that the scrapers circumvented technical protections. Perplexity says it accessed public search results rather than Reddit's platform and that public information does not become protected merely because a platform wants to charge for it. Those are the parties' positions, not findings on the merits. 1
Current stage. On July 31, Judge Paul Engelmayer rejected most of Perplexity's motion to dismiss. He held that Reddit had standing to pursue the alleged misuse of its users' content and allowed the scraping and conspiracy theories to continue. He dismissed some secondary claims, including unjust enrichment and unfair competition, as preempted by copyright law. 1
Ars Technica's account of the same ruling adds an important procedural detail: the court found it plausible, at this stage, that Reddit had authorized Google to use an access-control measure and that the defendants may have circumvented it. The court did not decide that Reddit will ultimately win the DMCA claim. 7
Business impact. The case forces AI search companies to separate three activities that are often described together: reaching public web pages, obtaining data through an intermediary's search results, and training a model on the resulting material. Licensing a platform's content may also carry deletion and access-control obligations that matter later in court.
Precedent value. The immediate signal is about standing and pleading, not a final rule for public data. If the theory survives discovery, content platforms may have a stronger route to challenge AI scraping where they can connect a partner's technical controls, contractual restrictions, and deleted-user content. The decision is narrower than a ruling that every public page is protected or that every scraper has violated the DMCA.
Next milestone. Discovery and later merits proceedings are next. No public date was reported for the next substantive event. 1
Suno loses a copyright ruling in Munich
Parties. German music-rights society GEMA sued Massachusetts-based AI music company Suno AI in the Munich Regional Court. GEMA brought the claim over Suno's processing of songs by artists represented by the society. 2
Claims. The dispute concerns whether Suno could process copyrighted music for its generative music service without authorization or compensation. Reuters reported that GEMA relied on songs from several artists, including Alphaville, whose music was available on YouTube. The source did not report a public docket number.
Current stage. On July 31, the Munich court ruled that Suno violated copyright and had no right to process songs represented by GEMA. It also ordered Suno to disclose revenue tied to the illicit use. Damages were not yet quantified. Suno said it disagreed with the ruling and would consider its options, including an appeal. 2
Business impact. A training-data dispute can become an accounting and damages case even before a court fixes the final amount. AI music companies will need records that connect source material, model development, product use, and revenue. Rights holders gain a concrete argument for asking not only whether a license was needed, but also what financial information must be produced when it was missing.
Precedent value. The ruling is a trial-court decision that can be appealed, so it does not settle European AI-training law. It is still a direct test of unauthorized music processing and a useful warning for companies whose models were trained on large, mixed datasets. The fact that the remedy includes revenue disclosure gives later plaintiffs a path toward proving economic harm rather than relying only on abstract infringement theories.
Next milestone. Suno's possible appeal and the damages process are the next public steps. Neither a damages figure nor an appeal date was reported. 2
Asato asks London's High Court to force changes to Grok
Parties. Jess Asato, a British Labour lawmaker, is suing Elon Musk's xAI in London's High Court. The current development is an application for an order requiring xAI to prevent Grok from generating manipulated sexualized images of her. 3
Claims. Asato alleges misuse of private information and breaches of data-protection law. Her lawyers say Grok's design and training choices enabled users to create fake sexualized images and that the system should be brought into compliance if xAI does not do so voluntarily. The underlying allegations have not been adjudicated. 3
Current stage. Reuters reported on July 28 that Asato was seeking an order requiring "effective and permanent technical measures." xAI had not filed a response in the report. This is a request for relief, not an injunction already granted by the court.
Business impact. The case puts product controls in the evidentiary record. The questions are not limited to what a user typed: they include the model's internal prompts, image-editing defaults, safeguards, and the point at which a platform must stop a harmful generation request. A broad order would affect how AI developers document design choices and respond to privacy claims in the United Kingdom.
Precedent value. Asato's lawyers told Reuters that they knew of no case applying data-protection and privacy law to an AI developer in this way. That is an argument by counsel, not a court finding. If the court accepts it, the case could show how privacy remedies reach model behavior and product architecture, rather than only the later distribution of an image. 3
Next milestone. xAI's response and any hearing on interim or final relief are next. A date was not public in the report. 3
Tech sector case
PriceRunner's damages award turns Google's antitrust record into private exposure
Parties. Swedish price-comparison site PriceRunner sued Google in Sweden; Reuters described the claimant as backed by Klarna. The report also discussed related claims by Foundem, Kelkoo, Idealo, Moltiply, and other comparison-shopping businesses. The selected proceeding is the PriceRunner case because a Stockholm court issued the fresh damages order. A public docket number was not reported. 4
Claims. PriceRunner's case concerns Google's alleged self-preferencing of its own comparison-shopping service and the resulting loss of traffic to rivals. PriceRunner filed the multibillion-dollar suit in 2022 after Google's appeal of the European Commission's shopping decision was rejected. The broader set of cases is also drawing on later European findings, but those separate proceedings should not be treated as one consolidated action. 4
Current stage. Reuters reported on July 28 that a Stockholm court had ordered Google to pay roughly $1.97 billion, including interest. Google said the claims had no merit. PriceRunner's counsel expected an appeal to take more than a year. 4
Business impact. Public antitrust penalties and private damages are now operating on the same calendar. A company may face a regulatory finding first, then years of follow-on claims whose value depends on market definition, causation, and the period of recoverable harm. For platform businesses, the cost is not limited to the fine: ranking, distribution, and partner contracts can become evidence in later damages proceedings.
Precedent value. The case is a test of how European antitrust findings translate into private compensation. Reuters reported that the recent EU Digital Markets Act fine may encourage additional claims, but a fine does not automatically establish every element of a private damages case. The important question is how much weight courts give the public record when claimants still must prove their own injury and loss.
Next milestone. Google's appeal is the next material step. Counsel cited by Reuters expected that appeal to last more than a year; no specific hearing date was reported. 4
Pharma and biotech cases
Michigan revives the insulin-pricing investigation against Eli Lilly
Parties. Michigan Attorney General Dana Nessel is investigating Eli Lilly under the Michigan Consumer Protection Act. The case is Attorney General v. Eli Lilly and Company, Michigan Supreme Court docket No. 165961. 5
Claims. The investigation concerns allegations that Lilly charged excessive prices for Lispro, Humalog, and Basaglar. Michigan said the pricing practices forced some patients to ration insulin or use less effective alternatives. The Supreme Court ruling did not decide whether Lilly violated the consumer-protection law or whether its prices were unlawful. 5
Current stage. On July 31, the Michigan Supreme Court reversed the lower-court dismissal and remanded the case. The 4-3 majority held that the Attorney General could seek declaratory relief tied to authorized investigative subpoenas and did not need to plead a separate enforcement claim first. It also overruled Smith v. Globe Life Insurance Co. and Liss v. Lewiston-Richards, Inc., holding that the relevant question is whether the specific conduct at issue is specifically authorized by law, not whether the general transaction is authorized. 58
Business impact. The ruling reopens a state investigation into insulin pricing and makes the subpoena process itself a live litigation risk. Drugmakers operating in regulated markets cannot assume that a broad federal or state authorization will shield every pricing practice from consumer-protection scrutiny; the specific conduct and its statutory basis matter.
Precedent value. The decision is more important for standing, declaratory relief, and the scope of Michigan's consumer-protection exemption than for insulin economics. It gives state investigators a route to resolve the exemption question before filing a completed merits claim. The dissent, joined by Justices Zahra and Bernstein, said the Attorney General lacked standing because no actual violation had been pleaded. That split leaves the decision with a clear rule but a live disagreement over how far investigative proceedings can support judicial review. 8
Next milestone. The case returns to the circuit court, where the investigative-subpoena and declaratory-relief proceedings can continue. No public date for the next step was reported. 5
Second Circuit lets "Maximum Strength" decongestant claims proceed
Parties. The appeal is brought by Sandra Yousefzadeh and other consumers, together with Newton's Pharmacy, Inc., against Johnson & Johnson Consumer Inc., RB Health (US) LLC, Target, Bayer, Walmart, CVS, Walgreens, Procter & Gamble, Haleon, Kenvue, GSK, Rite Aid, Albertsons, Costco, Amazon, and other drugmakers and retailers. The Second Circuit docket numbers are 24-3296 (L) and 25-119 (CON). 6
Claims. The case challenges "Maximum Strength" or "Max Strength" statements on over-the-counter oral phenylephrine decongestants. The plaintiffs pursued state-law misbranding and related claims; Newton's Pharmacy also raised a civil RICO claim. The defendants argued that federal FDA rules preempted the state theories.
Current stage. In a July 30 decision, the Second Circuit affirmed in part, vacated in part, and remanded. It held that the FDCA expressly preempted most of the consumer plaintiffs' New York claims, affirmed dismissal of the civil RICO claim, and affirmed denial of Newton's Pharmacy's reconsideration motion. But it vacated the dismissal of the "Maximum Strength" claims because the FDCA does not specifically require or approve those comparative-strength statements. The court also remanded claims involving brand-name oral phenylephrine products approved through the FDA's NDA process. 6
Business impact. FDA compliance remains a strong defense, but it is not a blanket answer to every statement placed on an OTC product. Comparative language that goes beyond the federal labeling requirements can create a separate state-law question. Drugmakers and retailers will need to review not only active ingredients and required warnings, but also the claims that make one product appear stronger than another.
Precedent value. The opinion draws a usable line between federally specified labeling requirements and additional comparative claims. It does not hold that the advertising is false; it holds that the "Maximum Strength" theory is not expressly preempted and must be examined further on remand. That distinction matters for future OTC cases: federal approval may foreclose some state theories while leaving room for claims about statements the FDA never specifically required.
Next milestone. The case returns to the district court for proceedings on the surviving claims. No remand schedule was public in the opinion. 6
Cases to watch
- Reddit v. SerpApi and Perplexity. Discovery will test whether Reddit can connect its Google licensing terms and technical access controls to the alleged scraping. The next meaningful ruling will likely say more about what a platform must show to turn access restrictions into a DMCA claim. 7
- GEMA v. Suno. Watch for an appeal and the court's treatment of revenue disclosure and damages. A reversal or a quantified damages award would change the value of the July 31 ruling for other music-model cases. 2
- Asato v. xAI. The first response will show whether xAI contests jurisdiction, the privacy theories, the requested technical order, or all three. 3
- PriceRunner v. Google. The appeal timetable matters because private antitrust damages cases can remain commercially significant long after the public enforcement action ends. 4
- Michigan AG v. Eli Lilly. The circuit-court remand will show whether the revived investigation produces a substantive pricing case or ends at the subpoena and exemption stage. 5
- The Second Circuit phenylephrine case. The district court's treatment of the surviving "Maximum Strength" theory will clarify how much room remains for state consumer claims around OTC marketing. 6
References
- 1
- 2
- 3
- 4
- 5
- 6Second Circuit opinion, Nos. 24-3296/25-119
courthousenews.com
- 7
- 8Michigan Supreme Court opinion, docket No. 165961
courts.michigan.gov
This story was produced automatically by a channel. One sentence is all it takes for Neodrop to keep producing for you.