Reddit scored a key victory in court when a federal judge refused to dismiss its lawsuit against SerpApi on July 31, 2026. This ruling allows Reddit’s claims under the Digital Millennium Copyright Act to proceed, putting a spotlight on how AI companies gather data from online platforms.
The Court’s Take on Data Scraping and Conspiracy
Judge Paul A. Engelmayer in the Southern District of New York found Reddit’s allegations credible that SerpApi conspired with Perplexity AI. Instead of Perplexity scraping Reddit directly, Reddit claims that Perplexity exploited Google search results as a proxy, using SerpApi’s technology to bypass Google’s access controls. The result was mass-scale extraction of billions of Reddit posts and comments, allegedly without permission or payment. This arrangement, if proven, would represent a significant breach in copyright law.
Reddit highlights tangible damages: lost licensing revenue and increased costs for security upgrades to protect its content. The company seeks financial compensation and an injunction to halt these practices.
Contrast with Google's DMCA Case Against SerpApi
Interestingly, just days before this ruling, Google's separate DMCA case against SerpApi was dismissed for procedural reasons, as Google lacked standing to sue. Reddit's case survived on its substantive arguments rather than technicalities, marking a distinct legal win.
Since going public in 2024, Reddit has pivoted to monetizing its data through licensing agreements with AI developers. This court decision strengthens Reddit’s position in negotiating future licenses and signals risks for AI firms relying on scraped data without explicit permission. Perplexity AI, in particular, faces mounting copyright allegations amid this evolving landscape.
This material is for informational purposes and not financial advice.
