The Barnard Briefcase: February 2025

AI, Copyright, and Training Data: the Legal Questions that Remain

By Viteshen Naidoo | Junior Associate

Deepseek, Meta and OpenAI

Copyright issues surrounding AI training data remain as complex as ever, recent developments in the AI space concerning Deepseek, OpenAI and Meta have reignited concerns over how generative AI models are trained and whether their methodologies infringe upon existing copyright protections.

OpenAI currently faces multiple legal challenges regarding its alleged use of copyrighted materials to train models like ChatGPT. Similarly, Deepseek has come under scrutiny for its approach to data acquisition and usage—ironically, by OpenAI itself.

Most recently, Meta (previously Facebook) has drawn attention by allegedly purposely stripping pirated libraries and other sources to train its models without proper attribution or licensing or any regard to copyright laws.

This scenario raises significant legal and ethical concerns and from a legal standpoint continues to dirty the waters surrounding liability and enforcement surrounding the use and application of AI training data, making it difficult to identified utilised works and additionally, complicating the enforcement of copyright protections. The complexity surrounding training data exacerbates these concerns, as companies often claim that their datasets are proprietary or obtained through ambiguous means. This lack of transparency not only hinders copyright holders from asserting their rights but also raises broader questions about fair compensation for original creators.

The Lack of Transparency in AI Training Data

One of the most pressing challenges is the lack of transparency in how AI models acquire and utilise data, making it difficult for rights holders to assess infringements or assert their claims. The EU AI Act offers a proposed solution, which imposes specific requirements on training data, particularly for high-risk AI models. Under the Act, AI developers must ensure that datasets used for training are legally obtained, traceable, and free from bias, with clear documentation on their sources.

This, however, is not the universal approach. The United States has notably taken a different stance, favouring lighter regulations to encourage AI innovation and competitiveness. Recent comments by U.S. Vice President JD Vance, warning Europe of “excessive” regulation in the AI industry, reinforce this divide. Vance cautioned that stringent regulatory frameworks like the EU AI Act could stifle technological progress, deter investment, and place European AI developers at a disadvantage compared to their U.S. and Chinese counterparts.

Given this perspective, it is highly unlikely that similar provisions, such as strict training data transparency or punitive fines—will be incorporated into U.S. AI policy in the near future.

The Need for Legal and Policy Direction

The growing body of litigation surrounding AI training data signals an urgent need for judicial clarity and legislative reform. Should these approaches continue to diverge, the landscape involving the publication and distribution of creative works in the future will change drastically.

This may proceed to take the form of increasingly complex Technology Prevention Measures (TPM’s) being implemented, increasing the cost and inaccessibility of works, or simply a greater adoption of closed access to information policies, further decreasing the accessibility of currently freely available information.

The continuing differences of opinion in approaches raises important questions for the current  manner in which works are published and distributed. Will it develop into a closed, tightly controlled ecosystem where content is locked behind proprietary barriers, or will it embrace a more open, yet legally accountable, model that balances innovation with copyright protection.

The decisions made by relevant role-players in the coming years will have drastic consequences on the accessibility, ownership, and control of digital works, ultimately shaping the future of creative expression and knowledge dissemination.

Do Post-Commencement Creditors Now Have a Say in Business Rescue?

By Koos Benadie | Director

The Impact of the Wescoal Judgment on the Voting Rights of Post-Commencement Creditors in Business Rescue Proceedings

The Supreme Court of Appeal’s (SCA) recent decision in Mashwayi Projects (Pty) Ltd and Others v Wescoal Mining (Pty) Ltd and Others (2025 ZASCA 5) has fundamentally reshaped the landscape of business rescue proceedings in South Africa. This landmark ruling has definitively affirmed that post-commencement creditors (PCFs) have voting rights in business rescue proceedings. By recognising the critical role PCFs play in the restructuring process, the judgment has introduced a new dynamic into business rescue law, with significant implications for practitioners, creditors, and distressed companies alike.

The Landmark Ruling: Voting Rights for Post-Commencement Creditors

The case arose from a dispute regarding the validity of a business rescue plan proposed for Arnot Opco (Pty) Ltd, which was undergoing business rescue proceedings. A key point of contention was whether PCFs – creditors whose claims arise after a company enters business rescue – were entitled to vote on the proposed business rescue plan. The High Court had ruled that only pre-commencement creditors had such voting rights, but this was overturned by the SCA.

The SCA’s decision, delivered by Dippenaar AJA, rejected the restrictive interpretation of the Companies Act 71 of 2008 (the Act) that limited voting rights solely to pre-commencement creditors. Instead, the court held that:

• The term creditor as used in the Act is not explicitly confined to pre-commencement creditors.
• There is no statutory basis for excluding PCFs from voting on business rescue plans.
• The objectives of business rescue – to facilitate the survival and restructuring of financially distressed companies – necessitate the inclusion of PCFs in the decision-making process.
• Excluding PCFs would create an unbalanced and commercially unrealistic scenario, discouraging post-commencement financing, which is vital for the success of business rescues.

This ruling provides much-needed clarity and ensures that PCFs, who frequently play a pivotal role in sustaining businesses under rescue, are afforded a say in the approval of business rescue plans.

Strengthening the Position of PCFs

The decision represents a significant shift in favour of PCFs, who now have a formalised influence in business rescue proceedings. The recognition of their voting rights means that:

• PCFs can now actively participate in shaping the restructuring strategy of a company in distress.
• Their financial contributions to a business in rescue will be better protected, as they will have direct input in determining whether a business rescue plan is viable.
• The judgment acknowledges that PCFs take on significant risk by providing finance or services to a company undergoing business rescue and should therefore have a proportionate degree of control over its future.

In effect, the ruling incentivises the provision of post-commencement finance (PCF), as lenders and service providers will now have a greater ability to influence the rescue process and the eventual outcome.

Implications for Business Rescue Practitioners

The Wescoal judgment imposes new obligations on business rescue practitioners (BRPs) when conducting creditor meetings and compiling voting results. The key takeaways for BRPs include:

• Revised Vote Tallying Process: BRPs must now include PCFs in the calculation of voting thresholds when determining whether a business rescue plan has been approved under section 152 of the Companies Act.
• Greater Scrutiny of Voting Interests: The distinction between pre-commencement and post-commencement creditors is now less relevant when tallying votes, requiring BRPs to ensure that PCFs are afforded their rightful say in the process.
• Potential for Disputed Outcomes: BRPs may face challenges from pre-commencement creditors who may seek to minimise the influence of PCFs. BRPs will need to navigate these disputes carefully, ensuring compliance with the ruling while managing competing creditor interests.
• Strategic Adjustments to Rescue Plans: Business rescue strategies will need to account for the influence of PCFs, potentially leading to revised financial models and negotiation tactics when structuring a business rescue plan.

The Wescoal judgment is a decision that significantly impacts business rescue law in South Africa. By affirming that post-commencement creditors have voting rights in business rescue proceedings, the SCA has ensured a more equitable process that acknowledges the risks undertaken by those who provide critical financial support to distressed businesses. The ruling enhances the likelihood of successful rescues by fostering greater confidence in post-commencement financing, ultimately benefiting the broader business rescue ecosystem.

Going forward, business rescue practitioners, financiers, and distressed companies must adapt to this new framework, where PCFs hold a decisive voice in determining the fate of businesses undergoing restructuring.

How to Obtain a Protection Order Against a Spouse in South Africa

By Isabel Van den Ende | Senior Associate

Did You Know?

In South Africa, married individuals are considered to be in a domestic relationship under the Domestic Violence Act. If you are experiencing any form of abuse from your spouse, you have the right to apply for a protection order through the Domestic Violence Court.

Understanding Protection Orders vs. Restraining Orders

Many people refer to “interdicts” or “restraining orders”, but under South African law, these are called protection orders. A protection order is a legal mechanism that prevents an abuser from continuing harmful behaviour and offers legal recourse if they violate the order.

What Qualifies as Domestic Violence?

A protection order can be sought if you are being subjected to any of the following forms of domestic violence:

• Physical abuse (assault, hitting, or any form of bodily harm)
• Sexual abuse
• Emotional, verbal, or psychological abuse (insults, threats, humiliation, obsessive jealousy)
• Harassment or stalking (persistent following, unwanted communication, threats)
• Intimidation (behaviour causing fear of harm)

The law does not require physical harm to grant a protection order – emotional and psychological abuse are also recognised forms of domestic violence.

Who Can Apply for a Protection Order?

You may apply for a protection order if you are in a domestic relationship with the abuser. This includes:

• Spouses (married or divorcing)
• Partners (living together or previously in a relationship)
• Parents and children
• Other family members
• Individuals who share a residence

How to Obtain a Protection Order: Step-by-Step Process

1. Visit the Domestic Violence Court

Go to your nearest Domestic Violence Court and request an application for a protection order.

2. Provide Evidence of Abuse

To strengthen your application, bring documentary evidence such as:

• WhatsApp messages, emails, or texts showing harassment or threats
• Photos of physical injuries (if applicable)
• A medical report (J88 form) if you visited a doctor due to physical abuse
• Witness statements from family or friends

3. Apply for an Interim Protection Order

Once your application is submitted, a Magistrate will review the details. If the court determines that you are in immediate danger, an interim protection order will be issued without informing the respondent (your spouse).

4. Serving the Order to the Respondent

The interim order must be served to your spouse by the police or sheriff, notifying them of the restrictions.

5. Final Protection Order Hearing

• The respondent will be given a return date to appear in court.
• Both parties can present arguments before the Magistrate.
• If the court is satisfied that ongoing protection is necessary, the final protection order will be granted.

6. Issuance of a Warrant of Arrest

Once the final protection order is granted, the court will issue a warrant of arrest, which allows law enforcement to arrest the abuser if they violate the order.

What Happens If the Protection Order Is Violated?

If the respondent breaches the order, you should:

• Report the violation to the police immediately.
• Provide proof of the violation (messages, threats, evidence of contact).
• The police can arrest the abuser using the warrant issued with the final order.

Final Thoughts

A protection order is a powerful legal tool to protect individuals from abuse in domestic relationships. If you are experiencing domestic violence, seek legal advice and take action to safeguard your rights.

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