Term Sheet | Fortune Vigorous defense

Reddit CEO Steve Huffman on the floor of the New York Stock Exchange during Reddit’s initial public offering on March 21, 2024 in New York City. (Photo: Spencer Platt/Getty Images)

Get ready to rumble. 

Reddit sued Anthropic on Wednesday, alleging that the AI startup was illegally “scraping” Reddit comments to train its chatbot.

The popular social media site alleges that Anthropic used automated bots to access the content despite being asked not to do so, and failed to get users’ consent.

“AI companies should not be allowed to scrape information and content from people without clear limitations on how they can use that data,” Reddit’s chief legal officer said. 

Anthropic rejected the claims. “We disagree with Reddit's claims and will defend ourselves vigorously,” it said in a statement.

Reddit has licensing agreements with Google, OpenAI, and other Anthropic rivals to receive compensation in exchange for the companies’ commercial use of the data—that is, training their AI systems on Reddit comments. 

But not Anthropic.

The lawsuit cites a 2021 paper co-authored by Anthropic CEO Dario Amodei that describes Reddit’s user forums, or “subreddits,” as a source of high-quality AI training data.

A 2023 Anthropic letter to the U.S. Copyright Office argued that the way its chatbot, Claude, trains “qualifies as a quintessentially lawful use of materials” because it copies information to perform statistical analysis. 

But Reddit’s lawsuit doesn’t allege copyright infringement, just a breach of its terms of use. —AN

Good news, Tar Heels: Amazon says it will invest $10 billion to expand its cloud computing and artificial intelligence infrastructure in North Carolina.

A new campus is on tap for rural Richmond County (pop: 41,990), about an hour’s drive east of Charlotte, that will create at least 500 jobs, among them engineers and security specialists.

Gov. Josh Stein said the investment was one of the state’s largest ever. “Artificial intelligence is changing the way we work and innovate, and I am pleased that North Carolina will stay at the forefront of all that’s ahead as we continue to attract top technology companies like Amazon,” he said in a statement.

County commissioners unanimously approved an incentives package that would give Amazon annual cash grants for two decades, calculated on the basis of property taxes levied on the site of the planned data center.

Earlier this year, Apple said it would boost its investment in the state and expand its existing 1 million sq. ft. datacenter in Catawba County, about an hour’s drive northwest of Charlotte, by almost 25%. 

Microsoft is also building out infrastructure in Catawba County. The company in 2022 announced plans to spend at least $1 billion on four data centers in the area, though it was reported earlier this year to be slowing construction on the site. —AN

If you’re one of Salesforce’s more than 150,000 customers, listen up.

A hacking group reportedly has been impersonating IT staffers via phone calls to break into the Salesforce instances at various companies in an attempt to steal their data.

That revelation comes courtesy of Google’s threat intelligence group, who say the hackers’ ultimate aims are extortion.

“This approach has proven particularly effective in tricking employees, often within English-speaking branches of multinational corporations, into actions that grant the attackers access or lead to the sharing of sensitive credentials, ultimately facilitating the theft of organization’s Salesforce data.”

Ouch.

The hackers, who have been linked to a group called the Com, have already successfully breached networks of at least 20 companies in the U.S. and Europe. Sometimes the extortion demands didn’t come until months later, the report adds.

Google was quick to note there wasn’t any technical flaw in Salesforce software to allow this to happen, just good old fashioned social engineering. Ah, humans. —AN