Court Rules Using AI to Generate False Corporate Information Constitutes Infringement

WISECODE Take

Many believe that using generative AI to produce false information allows them to evade liability by blaming machine hallucinations, but this recent ruling shatters that illusion. The Guangzhou Internet Court heard an infringement case where the defendant, Cao, inputted a 1,700-word document in August 2025 and instructed AI to generate a 10,000-word article falsely accusing a listed investment company of financial fraud. The court ruled that Cao intentionally inputted false reference materials and failed to label the AI-generated content, violating the Interim Measures for the Management of Generative Artificial Intelligence Services and ordering compensation. This demonstrates that AI is no longer a shield for defaming competitors; feeding false data to AI for an information warfare campaign is legally equivalent to spreading rumors yourself. Law-abiding businesses conducting proper fact-checking remain unaffected. Intellectual Classic IP offers trademark and reputation monitoring services to help enterprises track such new-age public relations threats. Enterprises should take two actions. First, establish public opinion monitoring to preserve evidence of prompt guidance and unlabeled AI content when targeted. Second, when using AI internally for marketing, enforce fact-checking and legal labeling to avoid legal trouble from exaggeration. While AI lowers the barrier to content creation, legal liability still traces back to the user's true intent.