When Open Data Meets Proprietary Walls: What Reddit ’s Lawsuit Against Perplexity Means for the Future of CX and AI Ethics
The Real-World Tension Beneath the Headlines
It started, as most digital conflicts do today, with a question of ownership — and ended in a courtroom. Reddit, the online forum synonymous with community conversations, has filed a landmark lawsuit against Perplexity AI, a San Francisco-based search and “answer engine” startup. The charge? Alleged data scraping on an industrial scale, violating copyright laws and deliberately bypassing security systems.
If this sounds like a familiar story, it’s because it fits the ongoing storm at the intersection of human creativity, machine learning, and fair use. But beneath the legal drama lies something deeper for CX and EX professionals — an urgent question of trust, ethical engagement, and experience design in the age of AI.
Because while this lawsuit is about datasets, it’s really about relationships — between platforms and users, creators and machines, and transparency versus extraction.
Inside Reddit’s Legal Claim
On October 22, 2025, Reddit filed a complaint in New York federal court against Perplexity and three data partners — Oxylabs (Lithuania), AWMProxy (a former Russian botnet), and SerpApi (Texas). Together, they’re accused of running what Reddit called a “data laundering” operation.
According to the filings, these firms allegedly evaded data protections and scraped millions of posts from Reddit by disguising their bots as regular users and even routing traffic through Google search. Reddit’s Chief Legal Officer, Ben Lee, framed it in plain language:
“AI companies are locked in an arms race for quality human content—and that pressure has fueled an industrial-scale data laundering economy.”
Reddit alleges that Perplexity purchased or acquired data sourced through these shadow channels, instead of entering into legitimate data-licensing agreements — the kind that Reddit has already negotiated with Google and OpenAI.
In one revealing detail, Reddit claims it even set a trap: a “test post” visible only through Google Search, not directly on Reddit. Within hours, that same content reportedly surfaced in Perplexity’s search responses.
If true, this would mean that Perplexity’s system — marketed as an innovative “answer engine” — relied on content copied through scraped or intermediary sources, bypassing the very licensing model Reddit had been advancing since its IPO.
Perplexity’s Defense: The Open Web Argument
Perplexity has pushed back firmly, calling the lawsuit an attempt to “control access to public knowledge.” Their position rests on a familiar Silicon Valley refrain — that information already visible through Google or the public web is fair game for aggregation and summarization.
Its public statement emphasized:
“We will always fight vigorously for users’ rights to freely and fairly access public knowledge. We will not tolerate threats against openness and the public interest.”
To Perplexity, this is not digital theft — it’s curation. The startup insists it doesn’t train large foundation models (like OpenAI or Anthropic) but instead uses available data to answer questions in real time, citing sources, including Reddit threads.
However, Reddit — and the broader digital publishing ecosystem — sees it differently. To them, open visibility doesn’t equate to open usage. If every piece of user-generated content becomes raw material for AI products without consent or compensation, what happens to ownership, attribution, or the experience of creators and communities?
Why CX and EX Leaders Should Care
At first glance, this controversy seems far removed from the world of customer experience and employee experience management. But it’s deeply relevant.
AI models today underpin CX automation — chatbots, service assistants, personalization engines, and analytics dashboards. If the inputs to those models come from questionable data sources, the ethical foundation of CX diminishes.
When companies depend on AI trained on scraped or unlicensed material, three experience risks emerge:
- Erosion of trust: Users lose faith in brands that exploit data ecosystems rather than respect them.
- Transparency deficits: Customers demand clarity on where insights come from and how AI makes decisions.
- Cultural dissonance: AI-generated responses may reflect biases, inaccuracies, or questionable sourcing — damaging brand authenticity.
Just as poorly designed CX erodes customer loyalty, AI practices perceived as exploitative corrode public confidence in digital systems. Reddit’s lawsuit is a signal flare — a reminder that ethical AI isn’t an optional layer; it’s experience infrastructure.
The Broader Context: A Data Arms Race
Reddit’s case is part of a wider battle that has drawn in OpenAI, Anthropic, and countless data intermediaries.
- Earlier this year, Reddit sued Anthropic for similar reasons — alleging unlicensed use of its content in AI model training.
- Media institutions like The New York Times and Encyclopedia Britannica have also filed suits against AI companies for using copyrighted text without approval.
- Meanwhile, Reddit struck multi-million-dollar licensing deals with OpenAI and Google — signaling that legitimate data-sharing models can coexist with innovation.
The lawsuit thus exposes a growing divide: one between licensed data partnerships that value creators, and shadow pipelines that treat human conversation as free fuel.
This arms race for “human content” impacts every CX leader depending on knowledge models. If your AI vendor is operating within gray legal territories, your customer strategy risk multiplies — reputationally and legally.
Case Study: Trust by Design in the AI Supply Chain
A compelling counterexample comes from Salesforce, which has built its “Einstein Trust Layer” explicitly to ensure AI data interactions meet security, privacy, and compliance thresholds. Salesforce’s model anonymizes prompts, enforces audited data flows, and allows customers to opt out of training datasets.
Similarly, Adobe’s “Content Credentials” initiative embeds digital signatures into images and text so users can verify whether AI models used them legitimately. These examples show that transparency itself is becoming a key differentiator in experience design.
When trust is operationalized, it becomes measurable CX value. When it isn’t, it breeds lawsuits like Reddit’s.
The Depth of the Ethical Divide
At the heart of Reddit vs. Perplexity is an ideological clash. Reddit argues that the human expression fueling its communities should be protected, respected, and compensated. Perplexity champions the original ethos of the internet — openness and universal access to information.
For CX strategists, the takeaway isn’t which side is right, but how such dualities shape digital relationships:
- Creators vs. Platforms: Who decides what’s “public” in the age of AI?
- Transparency vs. Secrecy: Can users meaningfully consent to invisible data pipelines?
- Speed vs. Integrity: Should AI-driven efficiency override the slower, human-centered process of permission and collaboration?
This lawsuit tests whether the open web remains genuinely open or becomes a gated ecosystem run by data-owning giants.
Redefining Digital Responsibility in Experience Strategy
From a CX perspective, digital responsibility is now an integral part of brand experience. Customers and employees evaluate not just how intuitive a product feels, but whether it acts responsibly.
As conversational AI, generative search, and knowledge automation embed deeper into service experiences, companies must evolve their ethical frameworks. That includes:
- Clear data provenance: Be explicit about where AI insights come from.
- Permission-based intelligence: Obtain proper usage rights before deploying data-driven AI.
- Human-in-the-loop systems: Retain active human oversight over automated analytics or chatbot design.
- Transparent supplier accountability: Audit AI vendors for compliance, sourcing, and responsible use.
- Proactive communication: Tell customers how AI contributes to their experience — don’t wait for them to discover it.
Tomorrow’s experience leaders won’t just manage emotions or journeys. They’ll manage ethical ecosystems, ensuring the pathways between human expression and machine interpretation remain visible, fair, and sustainable.
Practical Takeaways for CX/EX Professionals
- Audit your AI stack: Identify where external data partners source their inputs.
- Define responsible AI KPIs: Include “data transparency” and “ethical compliance” as part of CX performance metrics.
- Educate teams: Help employees understand how AI sourcing impacts trust and brand credibility.
- Collaborate with legal early: Build AI governance strategies in alignment with data privacy and copyright law.
- Champion human contribution: Position responsible data use as a brand value, not just a compliance checkbox.
The Experience Lesson Hidden in the Lawsuit
In essence, Reddit’s lawsuit against Perplexity is about the experience economy’s next evolution. Every dataset has a human behind it. Every scraped comment once carried emotion, insight, or community context.
As AI races ahead, the difference between exploitation and engagement lies in how we treat that humanity.
Experience-driven organizations understand that innovation without integrity is noise. The most trusted brands of tomorrow won’t just build smarter systems — they’ll design accountable ones.
