- Microsoft asks to dismiss lawsuit alleging Azure exclusivity over high prices of ChatGPT subscriptions
- Judge questions arbitration requirements tied to OpenAI agreements and legal arguments from Microsoft
- Subscribers argue that data supply restrictions limit output and increase service costs
A group of ChatGPT Plus subscribers are facing backlash in court after Microsoft asked a federal judge to dismiss their antitrust lawsuit, arguing that the claims depend on speculation rather than direct evidence of harm.
The lawsuit (a PDF of the complaint can be downloaded here) focuses on allegations that the collaboration between Microsoft and OpenAI led to higher prices and poorer quality of service.
Microsoft told the court that the lawsuit should be dismissed because subscribers bought services from OpenAI, not from Microsoft itself. That separation, it argued, means the plaintiffs cannot show the kind of direct injury required under antitrust law.
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In arbitration not federal court
If the judge decides the case should proceed, Microsoft said the dispute belongs in arbitration rather than federal court. Its outside counsel Julia Chapman argued that users agreed to arbitration terms when they signed up for ChatGPT, and those same terms should be extended to claims closely related to the service.
“Equitable estoppel exists to prevent the plaintiffs from doing just that,” Chapman said.
The plaintiffs’ lawyers disagreed, arguing that subscribers never agreed to resolve disputes with Microsoft through arbitration.
Their lawyer Briane Dunne told the court that extending arbitration protection to a company outside the original agreement goes beyond what the doctrine allows.
Judge P. Casey Pitts cast doubt on the arbitration argument during the hearing. He indicated that there could be connections between the agreements, but questioned whether OpenAI’s terms should control claims brought against Microsoft.
“There may be some ‘overlap,'” Pitts said, “but it’s unclear to me why I would have to think about the deal with OpenAI.”
The dispute centers on claims that Microsoft required OpenAI to rely solely on its Azure systems to provide the computing resources needed to run ChatGPT.
Plaintiffs argue that reliance on a single supplier limited output and contributed to higher costs and slower service improvements.
Microsoft denied these claims, saying that the subscription prices are set by OpenAI alone and not by Microsoft.
Its legal team also argued that the alleged deal relates to cloud infrastructure services, while the plaintiffs claim harm to the consumer AI market, creating a loophole that could weaken the antitrust case.
“This is not a horizontal per se illegal agreement,” Cohen said. “It is crystal clear from the law.”
Judge Pitts did not signal how he plans to rule, leaving both the dismissal and arbitration requests unresolved for now.
Via MLex
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