ChatGPT Faces Defamation Lawsuit in Australia

April 6, 2023

April 5th news, Australian councilor Brian Hood has threatened to sue OpenAI, the creators of ChatGPT, for defamation after the language model falsely claimed he had been imprisoned for bribery. This would be the first legal action taken against ChatGPT for defamation worldwide. Hood’s lawyers sent a letter to OpenAI on March 21st, requesting that the error be corrected within 28 days, but the company did not respond.


The False Claim

Last November, Hood was elected as a councilor in Hepburn Shire, 120 kilometers northwest of Melbourne. ChatGPT had mistakenly listed him as a criminal involved in a bribery scandal with the Reserve Bank of Australia’s subsidiary, Note Printing Australia. Hood’s lawyers clarified that he had reported the company’s bribery of foreign officials to win currency contracts, and he was never charged with any crime.

According to James Naughton, partner at Gordon Legal, the law firm hired by Hood, “This may be a milestone moment because it applies the law of defamation to a new field of artificial intelligence and IT publishing. He is an elected official, and his reputation is crucial to his position. Hood was elected based on his public records exposing corporate wrongdoing. Therefore, if people in his community could see this material, it would be different for him.”

Accusations Against ChatGPT

Furthermore, Naughton said if Hood sued, he’d accuse ChatGPT of lacking footnotes and misleading users. “It’s hard for anyone to say from behind how the algorithm arrived at this answer,” he said. “It’s very opaque.”

Potential Compensation

Defamation damages in Australia have a maximum compensation of around 400,000 AUD. Hood’s lawyers said he might seek over 200,000 AUD. But they acknowledged not knowing how many people were exposed to false information, which affects compensation.

ChatGPT has gained popularity worldwide since its launch last year. Microsoft integrated it into Bing in February. However, the spokesperson for Microsoft has not commented on this matter.

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