Artificial intelligence is changing how businesses create content and invent– and how ownership works.
From AI-generated photos and marketing images to logos, software code, pitch decks, and product designs, companies are using AI tools to move faster and scale creative output. But as adoption grows, one question keeps coming up for business owners: If AI created it, do I own it?
The short answer? It depends (We know, we know! You hate that answer as much as we do). And if your employees aren’t being intentional about how you use AI, you could be exposing your business exposed to serious intellectual property risks.
Let’s break down what you need to know– what the law says, where businesses get tripped up, and how to protect IP ownership when AI is part of your workflow.
Who Owns Copyrights in AI Works? How Copyright Law Treats AI-Generated Content
The short answer: it depends on how the photo was created and how much human involvement was involved.
Under current U.S. law, copyright protection requires sufficient human authorship. The U.S. Copyright Office has made its stance clear: works created entirely by AI, without sufficient human input aren’t subject to copyright protection.
This decision stems from a decision in 2022, where the Copyright Office rejected an application for an AI-generated graphic novel—even though a human had provided the prompts. Their reasoning? The creative spark still has to come from a person, not a machine. Their “official statement:”
“The nexus between the human mind and creative expression” remains essential for copyright protection. — U.S. Copyright Office, February 2022
he Office explained that copyright law still requires:
- Human creativity
- Human judgment
- Human control over the final expression
In other words, AI can assist—but it cannot replace authorship. Adding a layer of human input (and documenting it) is often the key to protectability.
Does My Business Own AI-Generated Content?
What does this mean for your business if you rely on tools like ChatGPT, Midjourney, or DALL·E to create visual content?
When people ask who owns the copyrights when made by AI, they often assume ownership automatically belongs to the person who typed the prompt.
That’s not how copyright law works.
Copyright protection requires a nexus between the human mind and creative expression. Prompting an AI tool alone usually isn’t enough. To qualify for copyright protection, a human must contribute creative decisions such as:
- Editing or retouching images
- Selecting and arranging elements
- Combining and retooling multiple outputs
- Making expressive changes that go beyond automation
Without that human contribution, the AI-generated photo may fall outside copyright protection entirely. The result? The AI-Generated content may not be protected by copyright at all, which means:
- your use isn’t exclusive
- it can be reused and repurposed by others
- you can’t enforce rights against infringers
For businesses relying on AI-generated visuals for branding, advertising, licensing, or as part of their product, that’s a major problem. Your content, creation, or branding is an unprotectable business asset.
Patents and Inventions: No, AI Can’t Be the Inventor
On the patent side, the rules are just as clear: only people can be inventors.
In Thaler v. Vidal (2022), the court held that AI systems cannot be named as inventors on U.S. patent applications. Other countries—including the UK and EU—have taken a similar position.
Why is this important? If your R&D or engineering teams are using AI tools to generate product improvements, you’ve got potential IP exposure. To safeguard the protectability of your products, you’ll need to ensure:
- A human inventor is involved in the creative process, and
- You’re documenting that contribution from the outset.
Otherwise, you could lose out on patent protection entirely.
The Fine Print: AI Platform Terms Can Override IP Ownership
Here’s where a lot of businesses get tripped up: even if you created something with an AI tool, and even if it qualifies under the laws as “protectable,” that STILL doesn’t always mean you own it.
Most AI platforms include lengthy terms of use that spell out exactly what rights you do- or don’t-have. Some allow commercial use, others retain ownership, and many include vague disclaimers around originality or exclusivity.
The result? You might not be the only one with access to that same logo, headline, or software code. If you’re using free or trial versions of AI tools, the licensing terms are often even more restrictive. This is especially worrisome in areas like “vibe coding” or content production.
For businesses that license content, develop proprietary visuals, or monetize creative work, this creates real exposure. You may technically “own” the content, while still giving a platform permission to reuse or resell it any way it wants.
A real-world example: The recent uproar against CapCut and it’s updated Terms of Service. These updated terms grant the platform broad (and potentially exploitative) rights over user-uploaded content, including the right to use, modify, and even sublicense user-generated videos, potentially without compensation or explicit consent. Meaning CapCut can do whatever it wants — and license to whoever it wants! That would especially damaging for businesses who exist by licensing their content or proprietary apps.
Business Risks of Not Understanding AI Ownership
If you don’t know who owns the copyrights when made by AI, your business may face:
- Loss of exclusivity in brand assets
- Inability to enforce IP rights
- Licensing conflicts with clients or partners
- Reduced company valuation
- Exposure during acquisitions or due diligence
For creative agencies, SaaS companies, and creative-forward brands, unclear ownership can undermine entire revenue models.
To reduce your exposure:
- Review the terms of use before your team uses any AI platform.
- Require disclosure when employees or contractors use AI in content or product development.
- Know that AI use cannot be avoided— you just need to figure out how to limit the risk.
- Layer in human creativity — edit, rewrite, or rework AI-created content to make it “more human” and therefore “more protectable.
How to Protect Ownership of AI-Generated Photos, Code, and Content
There is no arguing about it: AI is here to stay. And since is undoubtably part of your team’s creative workflow, now is the time to tighten up your approach to intellectual property protection. Here’s where to start:
- Audit your current tools and uses. Where is AI showing up in your processes? What are those tools being used to create?
- Set clear internal policies. Give your teams guidance on what’s allowed and what needs more “human touch” when it comes to using AI
- Update contracts. Use clear IP clauses in agency agreements, employment contracts, and contractor agreements that confirm originality and human authorship, especially in client work or licensing deals. This is especially important for creative agencies who are producing work for clients.
- Track human input. Make sure there are human touches at every checkpoint. If you’re working toward a patent, keep a clean paper trail showing who contributed what and when. If you’re launching brand campaigns, document the creative process.
- Review all tools’ privacy policies, IP clauses, and ownership rules. Any AI tools your team relies on need to be approved and vetted so that you/ your company owns all output.
FAQ: Who Owns Photos Made By AI?
FAQs: Who Owns Images Made by AI Tools? Who Owns Copyrights Made By AI?
Can AI-generated photos be copyrighted?
Only if there is sufficient human creative input. Fully AI-generated photos are generally not subject to copyright protection.
Who owns the copyrights when made by AI tools?
Ownership depends on human authorship and the platform’s terms of use.
Do AI platforms own my content?
Sometimes. Always check the terms before using AI tools commercially.
TL;DR: Don’t Assume You Own AI Generated Content
AI is here to stay—and the law is still catching up. Congress has already held hearings on AI and IP rights, and we’re likely to see more guidance from the USPTO and Copyright Office in the coming year.
But in the meantime, the best protection for your business is proactive legal strategy.
If your team is using AI to generate content, code, or designs, now’s the time to make sure your IP house is in order.
📩 Want help reviewing your AI content policies or updating your contracts? Schedule a call with Caroline or Kristen at Way Law — we’ll help you protect what you’re building and avoid messy ownership surprises down the road.