OpenAI faces copyright firestorm over Sora

If you came across a video this week of Sam Altman standing in a field surrounded by Pokémon, playfully telling the camera, "I hope Nintendo doesn't sue us," you weren't looking at real footage. It was made with Sora, OpenAI's newly released video generation app.

OpenAI dropped the iOS-only, invite-based app on Tuesday, and it skyrocketed to the top of Apple's App Store almost overnight. Once inside, users immediately started doing what the internet does best: flooding the feed with beloved cartoon characters and corporate logos.

The intellectual property free-for-all

Within days, Sora was crawling with clips featuring SpongeBob SquarePants, South Park, Rick and Morty, and Despicable Me. CNBC tested the app and confirmed it could easily spit out Ronald McDonald fleeing police in a burger car, Pikachu, Starbucks coffee cups, and characters from The Simpsons.

That would be dicey enough on its own, but the backstory makes it spicier. The Wall Street Journal previously reported that OpenAI gave talent agencies and Hollywood studios an opt-out option before launch—essentially telling them their IP would be fair game unless they asked to be excluded.

Legal experts were quick to sound the alarm. Jason Bloom, an intellectual property partner at Haynes Boone, pointed out that copyright law doesn't work on an opt-out basis where you simply tell the public you'll use everything until asked to stop. Stanford Law professor Mark Lemley added that OpenAI is blatantly exposing itself to a mountain of copyright lawsuits.

Hollywood is already on the warpath. Disney and Universal are actively suing Midjourney over copyrighted movie characters, and Disney hit Character.AI with a cease-and-desist letter just last week.

Altman pivots to granular opt-in

Facing mounting blowback, Altman published a blog post late Friday signaling a swift retreat from the opt-out stance.

He promised OpenAI is working on more granular controls that will mimic Sora's opt-in model for human likenesses. Under Sora's existing Cameo feature, users can upload their own biometric data to insert their likeness into videos, but nobody can use another person's face without explicit permission. Altman wants to extend similar granular permissions to rights holders, letting them decide how their characters are used—or ban them altogether.

Altman framed user creations as a new wave of interactive fan fiction that could generate immense value for brands, though he acknowledged some unauthorized generations would inevitably slip through the cracks.

He also dropped a strong hint on monetization: OpenAI has to make money on video generation somehow, and it hopes to share a cut of that revenue with cooperating rights holders.

Why it matters

OpenAI seems to be executing the classic Silicon Valley playbook here: ask for forgiveness, not permission. By keeping guardrails remarkably loose at launch, Sora generated instant viral momentum, dominated the App Store charts, and demonstrated massive consumer appetite before studios could react.

We think this launch strategy is calculated, but dangerous. Looking at how tightly OpenAI locked down personal likenesses through strict Cameo permissions, the wide-open access to copyrighted animated icons looks less like an oversight and more like a deliberate choice to fuel viral growth. Claiming you can use everyone's IP until they send an opt-out notice was never going to hold up in court.

For everyday users and video creators, right now is probably the golden hour to play with Sora's uninhibited sandbox. As opt-in controls roll out, your favorite characters will likely disappear behind corporate licensing walls.

For the broader AI industry, this marks a critical turning point. The legal battle is shifting from training data disputes to output licensing and revenue sharing. If OpenAI successfully bundles copyright holders into a lucrative royalty model, it could set the de facto standard for commercial AI media. But if Nintendo, Disney, or other IP owners decide to make an example out of them first, Sora could face a brutal legal reckoning.