Chegg, a US-based online education platform, filed a lawsuit against Google on Monday, claiming that the tech giant’s AI-generated search overviews are damaging original content creators. The lawsuit, filed in Washington, DC, accuses Google of using publishers’ content for free, which reduces the financial incentives for content creators and undermines the value of the digital publishing ecosystem.

AI Overviews Undermining Content Creators

According to Chegg, Google’s AI overviews—summarized answers powered by artificial intelligence—are keeping users on Google’s platform, making it harder for publishers to generate traffic and monetize their work. The company argues that this shift is detrimental not only to Chegg but to the broader digital publishing industry.

Chegg CEO Nathan Schultz explained the financial fallout, noting that the company’s visitor numbers and subscriber base have dropped due to Google’s AI overviews. This decline in traffic has prompted Chegg to explore options, including the potential sale of the company or a private transaction.

Google’s Response

Google, however, has dismissed the claims as “meritless.” In a statement, spokesperson Jose Castaneda defended the AI overviews, stating that they help users find more relevant and diverse information through Google Search. He emphasized that the overviews create opportunities for more content to be discovered, sending billions of clicks to websites across the web.

Despite this, Chegg contends that Google is profiting off its content by providing users with AI-generated summaries, which drive fewer clicks to publishers’ sites. This, the company argues, violates antitrust laws by coercing publishers into allowing Google to use their content without fair compensation.

Chegg’s Struggling Financials

The lawsuit comes amid financial difficulties for Chegg. The company’s stock price has fallen drastically, closing at $1.57 on Monday, a staggering 98% drop from its peak in 2021. In November, Chegg also announced it would lay off 21% of its workforce, further highlighting the strain on its business model.

Schultz emphasized that this lawsuit is not just about Chegg’s troubles, but also the broader impact on the educational and publishing industries. “It’s about students losing access to quality, step-by-step learning in favor of unverified, low-quality AI summaries,” he said.

Antitrust Implications

Chegg’s legal action is believed to be the first of its kind, with the company accusing Google of violating antitrust laws through its use of AI overviews. An Arkansas newspaper filed a similar claim against Google in 2023 as part of a class action lawsuit on behalf of the news industry.

U.S. District Judge Amit Mehta, known for overseeing cases involving Google’s alleged illegal monopoly in online search, is overseeing the case. While Google has vowed to appeal a ruling that found it guilty of monopolistic behavior, it continues to face mounting legal challenges.

The Future of AI and Publishing

The lawsuit raises questions about the future of AI-generated content and its implications for digital publishers. As Google expands its use of artificial intelligence in search, the landscape for content creators may continue to evolve, leaving many to wonder how they can adapt and survive in an increasingly AI-driven world.

While Google maintains its stance, claiming its AI innovations benefit users and content creators alike, Chegg and other industry players are pushing back, asserting that fair compensation and visibility for original content are crucial for maintaining a healthy digital ecosystem.