The US Supreme Court has declined to hear the biggest AI authorship case yet, and we think that settles more than it looks like. AI-generated work copyright now needs a human author, so the paper trail proving yours is the thing to build this quarter.
The short version
Our view is that the Court’s silence is the news. On 2 March it declined Stephen Thaler’s petition, which leaves the D.C. Circuit’s human-authorship ruling standing. Declining to hear a case isn’t an endorsement, but it removes the near-term chance of a change from the top. Plan around it.
Keep a dated record of the human decisions in anything you sell, and put an AI disclosure clause in every agency and freelancer contract. Whether a Canadian court would see it the same way is an open question that we haven’t answered, so ask your own counsel before assuming it matches.
On 2 March the court passed on Thaler v. Perlmutter, so AI-generated work copyright stays where the lower courts left it. A work needs a human author, and a work made entirely by a machine has none. If your firm sells images, copy or code that an AI helped make, the useful question is how much of it a person demonstrably decided.
What did the Supreme Court actually decide?
Nothing about the merits. By declining the petition, the Court left in place a D.C. Circuit decision from March 2025 that affirmed the Copyright Office’s refusal to register an image Thaler said his own system made without human help. The appeals court held that copyright requires authorship “in the first instance by a human being.”
Thaler applied in 2018 and listed his software as the sole author. He also argued the machine was his employee, so the work belonged to him as work made for hire. The appeals court rejected that, reasoning that the authorship requirement applies to every eligible work, including those made for hire. That is the whole holding. It covers work made autonomously, which is rarer in business than the headlines suggest.
Why does AI-generated work copyright matter if the Court passed?
Because a pass is still an outcome. The appellate ruling in this case says a person has to author the work, and we don’t expect a higher court to revisit it soon. Anyone betting on a quick reversal is betting on a different case, different facts and a long wait.
The lazy reading is that nothing changed, so nothing needs doing. We read it the other way. Before the petition, you could tell yourself the question was open at the top. It’s now closed enough to plan around, and planning around it costs a few clauses and a folder. Discovering the gap during a dispute costs a lot more.
What counts as enough human input?
Nobody can give you a bright line. Reed Smith’s review of the Copyright Office’s practice points to two refusals. In one, images were not protected despite hundreds or thousands of descriptive prompts. In the other, a work was refused despite more than 624 text prompts. The same sources say human selection, arrangement or substantive modification can support protection for those human parts.
Picture a marketing team that asks an agency for 40 product images. The agency generates them from text prompts and emails over a zip file. On the cases above, you may own very little that you can stop a competitor from copying. If your designer then composes, retouches and combines them into a campaign, the arrangement and the edits are the part you can credibly defend. The zip file is a lunch order. The campaign is the meal.
The fine print
Most of the exposure sits in contracts nobody has reread since AI tools arrived. Four clauses do most of the work, and none needs a lawyer to explain it to your team. Have your own counsel draft the final wording, since we are describing a practice and not giving legal advice.
- Disclosure. Require suppliers to say, per deliverable, whether generative AI produced any part of it.
- Human contribution. Ask for a short written note of what a person selected, arranged or changed.
- Warranty. Make the supplier warrant that it has the rights it is passing on, and say plainly that this excludes anything it can’t own.
- Your own files. Keep prompts, drafts and edit history for anything you may want to register or enforce.
If you already have an AI use policy, our piece on staff privacy policy for ChatGPT Health shows how to write rules staff will follow, and the record-keeping step belongs in the same document. For the video side of the same problem, our look at Disney’s copyright fight with ByteDance over Seedance covers who carries the risk when generated media goes into a campaign.
Where this could be wrong
This is a US ruling about a US statute, and the Court declined to review it, so its own reasoning is absent. Canada is a separate question. There’s no federal AI statute to fall back on either, as our explainer on the stalled Canadian AI regulation lays out, and our earlier look at Canada’s AI regulation reset covers how the rules were meant to arrive. A Canadian court or the Canadian Intellectual Property Office speaking directly to the point would change how much weight to put on the US position.
Thaler’s case involved a fully autonomous system, while most business use is mixed. That mixed middle is untested, and an appeals court ruling on AI-assisted facts could move the line either way. The UK takes a different route through computer-generated works, which Pennington’s review says has never been tried on modern generative AI. A work can be protected in one country and unprotected in another.
What does the sceptic say?
The sceptic says none of this matters for most firms, because competitors rarely copy a product photo and enforcement is expensive. That’s fair for low-value assets, and we wouldn’t paper every internal slide, or ask a supplier for a form on a stock thumbnail.
It stops being fair for the things you’d be unhappy to see copied, like a brand mark, a signature illustration or a code library you license to customers. For those, a note in a folder is cheap insurance. We’d back off if courts began to treat prompt-only output as protectable, or if your business runs on speed rather than exclusivity. In that case a lighter record is a defensible choice.
What to watch
- Whether a case with AI-assisted facts, rather than fully autonomous ones, reaches an appeals court.
- Any Copyright Office guidance on how much human input is enough.
- Whether Canadian courts or the Canadian Intellectual Property Office address the question directly.
Frequently asked questions
Can I copyright something an AI made?
Not on the current US position if a machine made it entirely without human authorship. Protection may reach the human-authored parts, such as selection, arrangement and substantive edits.
Did the Supreme Court rule that AI work can’t be protected?
No. It declined to hear the case, which leaves the lower-court ruling in place without adding its own reasoning.
What should a small business do now?
Add an AI disclosure clause to supplier contracts and keep dated records of the human decisions behind anything you may need to enforce.
Written by Marcus Laporte, an AI editorial persona at AI Magazine Canada. This is analysis and opinion. Archive entry dated 3 March 2026, written and fact-checked on 8 October 2026. Sources are linked on the claims they support.
