June 25 (Reuters) - Microsoft ( MSFT ) has been hit with

a lawsuit by a group of authors who claim the company used their

books without permission to train its Megatron artificial

intelligence model.

Kai Bird, Jia Tolentino, Daniel Okrent and several others

alleged that Microsoft ( MSFT ) used pirated digital versions of their

books to teach its AI to respond to human prompts. Their

lawsuit, filed in New York federal court on Tuesday, is one of

several high-stakes cases brought by authors, news outlets and

other copyright holders against tech companies including Meta

Platforms ( META ), Anthropic and Microsoft ( MSFT )-backed OpenAI over alleged

misuse of their material in AI training.

The complaint against Microsoft ( MSFT ) came a day after a

California federal judge ruled that Anthropic made fair use

under U.S. copyright law of authors' material to train its AI

systems but may still be liable for pirating their books. It was

the first U.S. decision on the legality of using copyrighted

materials without permission for generative AI training.

Spokespeople for Microsoft ( MSFT ) did not immediately respond to a

request for comment on the lawsuit. An attorney for the authors

declined to comment.

The writers alleged in the complaint that Microsoft ( MSFT ) used a

collection of nearly 200,000 pirated books to train Megatron, an

algorithm that gives text responses to user prompts. The

complaint said Microsoft ( MSFT ) used the pirated dataset to create a

"computer model that is not only built on the work of thousands

of creators and authors, but also built to generate a wide range

of expression that mimics the syntax, voice, and themes of the

copyrighted works on which it was trained."

Tech companies have argued that they make fair use of

copyrighted material to create new, transformative content, and

that being forced to pay copyright holders for their work could

hamstring the burgeoning AI industry.

The authors requested a court order blocking Microsoft's ( MSFT )

infringement and statutory damages of up to $150,000 for each

work that Microsoft ( MSFT ) allegedly misused.