Disney takes opposing AI stances in one day: sues Google, strikes $1B OpenAI deal

On December 11, The Walt Disney Company executed a striking two-pronged AI strategy in a single day: it sent a cease-and-desist letter to Google accusing it of “massive copyright infringement,” then hours later announced a $1 billion investment in OpenAI and a licensing deal granting Sora access to over 200 Disney-owned characters.

In the legal letter—delivered Wednesday by Disney’s legal team—the company alleged that Google’s AI models, including Veo, Imagen, and Nano Banana, “systematically” copied and commercially distributed protected Disney content during both training and output phases. The complaint cited unauthorized use of iconic IPs such as Frozen, The Lion King, Moana, The Little Mermaid, and Deadpool. Disney likened Google’s platforms to “a virtual vending machine” churning out copyrighted characters, some bearing Gemini watermarks that could mislead the public into believing Disney had endorsed them.

Disney said it had engaged Google for months without meaningful response and demanded immediate cessation of all copying, display, and derivative use of its IP, along with full disclosure of training data sources. Google responded only by stating it maintains a “longstanding, mutually beneficial relationship” with Disney and highlighted its copyright tools like Google-Extended and Content ID.

Almost simultaneously with the legal move, Disney unveiled a three-year strategic partnership with OpenAI. Under the agreement, OpenAI’s Sora platform will be authorized to generate short videos featuring Disney, Marvel, Pixar, and Star Wars characters—excluding real-person likenesses or voices—for sharing on Disney+. CEO Bob Iger framed the deal as an effort to “responsibly expand storytelling boundaries,” while OpenAI pledged robust content filters and auditing mechanisms to prevent unauthorized derivatives.

Industry observers note that Disney’s “fight-and-talk” approach reflects Hollywood’s broader dilemma in the generative AI era: protecting valuable IP from uncompensated use while harnessing AI to revitalize legacy franchises and cut production costs. With courts still undecided on whether AI training constitutes fair use, major content owners are increasingly pursuing litigation and licensing in parallel—a trend likely to define the next two years.