The Copyright Office is back in the spotlight after former President Donald Trump abruptly removed its director, Shira Perlmutter. The firing came just hours after a major report questioned how AI companies use copyrighted material to train their models.
Trump’s decision, first reported by CBS News and Politico, sparked criticism from lawmakers. Representative Joe Morelle, a top Democrat, called the move an “unprecedented power grab” and said it followed Perlmutter’s refusal to support Elon Musk’s push for mass data access.
Perlmutter, who was appointed in 2020, had been leading the Copyright Office under the Library of Congress. Trump also removed Librarian of Congress Carla Hayden this week, raising more concerns about the administration’s intent.
The firing came shortly after the Copyright Office published part three of its ongoing report on artificial intelligence and copyright. In the report, the agency said AI companies might not be able to rely on “fair use” when training models with large amounts of copyrighted content. It warned that creating AI-generated content that competes with original works could go beyond what fair use allows.
While the report didn’t recommend immediate government action, it encouraged new licensing systems. These would allow AI developers to pay rights holders for access. The report also proposed ideas like extended collective licensing to fix market gaps.
Trump indirectly referenced the situation on his Truth Social platform. He reshared a post from lawyer Mike Davis, who appeared to criticize the firing. Davis warned that it could lead to tech companies exploiting creators for AI training.
Elon Musk, a close ally of Trump, is tied to both OpenAI and xAI—two startups that use massive data sets to build language models. Musk has also supported calls to eliminate intellectual property law altogether. He recently backed a post from Twitter founder Jack Dorsey that said, “delete all IP law.”
Meanwhile, companies like OpenAI are facing legal battles. Several lawsuits accuse them of scraping copyrighted works without permission. In response, OpenAI has asked the government to clarify copyright rules to better protect AI development under fair use.
The Copyright Office noted that fair use might cover academic research. But it drew a clear line when it comes to using protected works for profit without a license.
As the debate heats up, creators and tech companies are watching closely. The sudden shake-up at the Copyright Office adds more fuel to the growing fight over who controls content in the AI era.
