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(Reuters) -Social media platform Reddit sued artificial intelligence startup Perplexity in New York federal court on Wednesday, accusing it and three other companies of unlawfully scraping its data to train Perplexity's AI-based search engine. Reddit said in the complaint that the data-scraping companies circumvented its data protection measures in order to steal data that Perplexity "desperately needs" to power its "answer engine" system. The case is one of many filed by content owners against tech companies over the alleged misuse of their copyrighted material to train AI systems. Reddit filed a similar lawsuit against AI startup Anthropic in June that is still ongoing.  "Our approach remains principled and responsible as we provide factual answers with accurate AI, and we will not tolerate threats against openness and the public interest," Perplexity said in a statement. "AI companies are locked in an arms race for quality human content – and that pressure has fueled an industrial-scale 'data laundering' economy," Reddit chief legal officer Ben Lee said in a statement.  Reddit, which features thousands of interest-based "subreddit" web communities, said in the lawsuit that it is the most commonly cited source for AI-generated answers to user questions. It has licensed its content to Google, OpenAI and others for their AI training.  Reddit said that Lithuania-based Oxylabs, Russia-based AWMProxy and Texas-based SerpApi scraped Reddit data from billions of search results without permission and that Perplexity, which does not have a license to use Reddit content, worked with at least one of the data-scraping companies to obtain Reddit material. "We strongly disagree with Reddit's allegations and intend to vigorously defend ourselves in court," a SerpApi spokesperson said. Oxylabs said in a statement that it was "shocked and disappointed by this news, as Reddit has made no attempt to speak with us directly," and that it would also defend itself against the allegations. AWMProxy could not be reached for comment. Reddit said it sent Perplexity a cease-and-desist letter last year, after which it "increased the volume of citations to Reddit forty-fold." Reddit asked the court for unspecified monetary damages and an order blocking Perplexity from using its data. (Reporting by Blake Brittain in Washington; Editing by Nick Zieminski and Stephen Coates)

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By Blake Brittain (Reuters) -Conservative activist Robby Starbuck sued Google on Wednesday, alleging the tech giant's artificial intelligence systems generated "outrageously false" information about him. Starbuck said in the lawsuit, filed in Delaware state court, that Google's AI systems falsely called him a "child rapist," "serial sexual abuser" and "shooter" in response to user queries and delivered defamatory statements to millions of users. Google spokesperson Jose Castaneda said most of the claims were related to mistaken "hallucinations" from Google's Bard large language model that the company worked to address in 2023.  "Hallucinations are a well-known issue for all LLMs, which we disclose and work hard to minimize," Castaneda said. "But as everyone knows, if you’re creative enough, you can prompt a chatbot to say something misleading." Starbuck is best known for opposing diversity, equity and inclusion initiatives. "No one — regardless of political beliefs — should ever experience this," he said in a statement about the lawsuit. "Now is the time for all of us to demand transparent, unbiased AI that cannot be weaponized to harm people." Starbuck made similar allegations against Meta Platforms in a separate lawsuit in April. Starbuck and Meta settled their dispute in August, and Starbuck advised the company on AI issues under the settlement. According to Wednesday's complaint, Starbuck learned in December 2023 that Bard had falsely connected him with white nationalist Richard Spencer. The lawsuit said that Bard cited fabricated sources and that Google failed to address the statements after Starbuck contacted the company. Starbuck's lawsuit also said that Google's Gemma chatbot disseminated false sexual assault allegations against him in August based on fictitious sources. Starbuck also alleged the chatbot said that he committed spousal abuse, attended the January 6 Capitol riots and appeared in the Jeffrey Epstein files, among other things. Starbuck said he has been approached by people who believed some of the false accusations and that they could lead to increased threats on his life, noting the recent assassination of conservative activist Charlie Kirk.  Starbuck asked the court for at least $15 million in damages. (Reporting by Blake Brittain in Washington; Editing by Leslie Adler)

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By Akash Sriram and Abhirup Roy (Reuters) -Tesla  reported record third-quarter revenue that beat Wall Street estimates on Wednesday, driven by the highest quarterly sales of its electric vehicles as U.S. buyers rushed to lock in a key tax credit ahead of its expiry last month. However, Tesla's profit failed to live up to analysts' expectations, in part due to tariff and research costs, as well as a drop in income from regulatory credits that are expected to continue to fade away with recent legislation passed by the Trump administration. Tesla's $1.45 trillion valuation largely reflects investor bets on CEO Elon Musk's pivot to robotics and AI, but vehicle sales remain key to the financial stability of the company while those products are being developed. Shares of the Austin, Texas-based company were down 4% in extended trading. Demand for Tesla's vehicles and those of its rivals is also expected to drop through the rest of the year without the tax credits that have been a key driver of EV sales. Tesla did not provide a full-year forecast. "While we face near-term uncertainty from shifting trade, tariff and fiscal policy, we are focused on long-term growth and value creation," the company said on Wednesday. Apart from the removal of tax credits and the waning sales of regulatory credits that traditional automakers bought to make up for their polluting vehicles, Tesla is also grappling with tariffs imposed by the Trump administration on auto-parts imports, which Chief Financial Officer Vaibhav Taneja said cost Tesla more than $400 million in the quarter. The EV maker flagged rising expenses in multiple areas, also including a 50% rise in operating expenses driven by AI and other research and development projects, and an increase in stock-based compensation. On an earnings conference call, Taneja said capital expenditures would rise substantially in 2026. "Tesla dished out just the right amount of good and bad news to both appease its fans while also providing enough evidence for its critics," Camelthorn Investments adviser Shawn Campbell told Reuters. "This earnings report isn't going to change anyone's mind on Tesla." To combat a demand drop, Tesla introduced lower-cost "Standard" variants of Model Y and Model 3 vehicles earlier this month, stripping out a myriad of premium and basic features and lowering prices by about $5,000 to $5,500. While Tesla hopes the cheaper variants will drive higher volumes, analysts warn the move will squeeze margins as thousands of dollars of cost cuts per vehicle may not fully compensate for lower selling prices. Tesla said it was on track to start volume production of its Cybercab robotaxi, Semi truck and Megapack 3 battery in 2026. Tesla's energy business also showed strength, including an 81% increase in storage deployment in the quarter, and its robot plans are advancing, with the first-generation production line of its Optimus humanoid robot being installed. The electric vehicle maker reported total revenue of $28.1 billion for the third quarter ended September 30, compared with analysts' average estimate of $26.37 billion, according to data compiled by LSEG. Profit per share in the third quarter was 50 cents, below analysts' estimates of 55 cents. Automotive regulatory credits, once a key driver of profit, fell to $417 million in the quarter from $739 million a year ago and $435 million in the second quarter. Tesla reported gross margin of 18%, compared with estimates of 17.5%. Its closely watched automotive gross margin, excluding regulatory credits, was 15.4%, compared with an average estimate of 15.6%, according to 19 analysts polled by Visible Alpha.  Tesla's limited rollout of its self-driving "robotaxi" service in Austin, Texas earlier this year marked a key strategic pivot, underpinning investor expectations that the company will transition from pure vehicle sales to focusing on self-driving technology. Musk on the conference call said he expected robotaxis to operate without safety drivers in large parts of Austin this year and that robotaxis would be operating in eight to ten metropolitan areas by the end of the year as well. Wall Street expects Tesla's deliveries in 2025 to fall 8.5% due to the expiry of the tax credit, reliance on older models and rising competition. CEO Musk's embrace of right-wing politics has also alienated some potential buyers. Some analysts remain skeptical of a strong rebound as the cheaper version could take away sales of more profitable premium vehicles. (Reporting by Akash Sriram in Bengaluru and Abhirup Roy in San Francisco; Editing by Anil D'Silva, Peter Henderson and Matthew Lewis)

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(Reuters) -A group including right-wing U.S. media personalities Steve Bannon and Glenn Beck has signed a statement calling for a ban on developing superintelligent artificial intelligence until the public demands it and science paves a safe way forward, according to the non-profit organizers of the initiative. The proposal, also signed by technology pioneers Geoffrey Hinton and Yoshua Bengio, is the latest organized by the Future of Life Institute, which for more than a decade has raised concerns about the risk it says intelligent machines pose to humanity. The institute, founded in 2014, was supported early on by Tesla CEO Elon Musk and software programmer and tech investor Jaan Tallinn. Many in the technology industry and the U.S. government have opposed such pauses, arguing these worries are unwarranted and undermine innovation and economic growth. Still, the support from figures such as Bannon reflects potentially growing AI unease among the populist right at a time when many with ties to Silicon Valley hold influential roles in the Republican administration of U.S. President Donald Trump. Steve Bannon and Glenn Beck did not immediately respond to a request for comment. Other signatories for the statement include Apple's co-founder Steve Wozniak, Ireland's former President Mary Robinson, and Virgin Group founder Richard Branson, the institute said. (Reporting by Jeffrey Dastin in San Francisco; Additional reporting by Chandni Shah in Bengaluru; Editing by Chris Reese)

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(Reuters) -Polymarket is in early discussions with investors and looking to raise funds at a valuation between $12 billion and $15 billion, Bloomberg News reported on Wednesday, citing people familiar with the matter. Polymarket did not immediately respond to a Reuters request for comment. In June, the world's biggest prediction market was close to raise $200 million in a funding round that would value it at more than $1 billion, Reuters reported. Polymarket allows users to place bets using cryptocurrency on real-world events. Earlier this month, Intercontinental Exchange announced that it would invest up to $2 billion in Polymarket as it prepares to re-enter the U.S. more than three years after restricting American users. Prediction markets, where users wager on outcomes across sports, entertainment, politics and the economy — including bets on when the U.S. government shutdown will end and the least-streamed song on Taylor Swift's latest album — have seen a surge in institutional interest since the presidential election last year. (Reporting by Anusha Shah in Bengaluru; Editing by Alan Barona)

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By Francesco Guarascio HANOI (Reuters) -A landmark U.N. cybercrime agreement aimed at curbing offences that cost the global economy trillions of dollars annually is set to be signed by representatives from dozens of states in Hanoi this weekend, despite criticism over human rights risks. The convention, which would come into force after it is ratified by 40 states, is an unprecedented move that the United Nations expects will make responses to cybercrime quicker and more effective. Activists, major technology companies and the U.N. High Commissioner for Human Rights have warned about possible abuses from its vague language on crime, with some saying it would facilitate rather than combat illegal activities. The list of signatories has not been released, though the European Union and Canada are set to sign the pact, which they said included safeguards to protect human rights. The U.S. State Department declined to say whether a U.S. representative will attend the signing ceremony. VIETNAM'S APPROPRIATENESS AS HOST QUESTIONED Vietnam's selection as host has drawn criticism due to its human rights record. In a report in August, the U.S. State Department cited "significant human rights issues" in Vietnam, including restrictions on online freedom of expression. At least 40 people have been arrested this year in Vietnam, for alleged crimes including online postings against the state, according to Human Rights Watch. The one-party Communist nation expects to raise its international profile by hosting the event and sees the pact as a tool to boost its cyber defences, Vietnamese officials said. U.N. Secretary-General Antonio Guterres is scheduled to attend the signing ceremony on Saturday. CRITICS DUB PACT 'SURVEILLANCE TREATY' The Cybersecurity Tech Accord, a coalition that includes Meta and Microsoft, has labelled the pact "a surveillance treaty" that facilitates the exchange of personal data among governments and risks "making it easier, not harder, for criminals to engage in cybercrime." The convention targets a broad spectrum of offences from phishing and ransomware to online trafficking and hate speech, the U.N. has said, citing estimates that cybercrime costs the global economy trillions of dollars each year. But the U.N. High Commissioner for Human Rights warned during treaty negotiations that "laws with overly broad definitions of cybercrime are frequently used to impose undue restrictions on the right to freedom of expression." Raman Jit Singh Chima of Access Now, an advocacy group, said the treaty could facilitate the extradition of individuals persecuted by their governments. The signing in Vietnam "sends a very bad signal" to human rights defenders, he added. Vietnam is experiencing an escalation of cyberattacks targeting critical infrastructure and big corporations, Le Xuan Minh, head of cybersecurity at the public security ministry, told a press conference this month, noting more international cooperation could help identify perpetrators. The U.N. Office on Drugs and Crime (UNODC), which led the treaty talks, said the agreement includes provisions to protect human rights and allows states to reject cooperation requests that conflict with international law. Activists and tech firms have also voiced concern that the treaty could criminalise ethical hackers who test systems for vulnerabilities, especially when their findings expose sensitive government flaws. The UNODC said the convention "encourages" states to enable legitimate research activities. (Reporting by Francesco Guarascio; Additional reporting by Khanh Vu in Hanoi and Michelle Nichols in New York; Editing by Jamie Freed)

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By Akash Sriram and Abhirup Roy (Reuters) -Tesla  reported record third-quarter revenue that beat Wall Street estimates on Wednesday, driven by the highest quarterly sales of its electric vehicles as U.S. buyers rushed to lock in a key tax credit ahead of its expiry last month. However, Tesla's profit failed to live up to analysts' expectations, in part due to tariff and research costs, as well as a drop in income from regulatory credits that are expected to continue to fade away with recent legislation passed by the Trump administration. Tesla's $1.45 trillion valuation largely reflects investor bets on CEO Elon Musk's pivot to robotics and AI, but vehicle sales remain key to the financial stability of the company while those products are being developed. Shares of the Austin, Texas-based company were down 4% in extended trading. Demand for Tesla's vehicles and those of its rivals is also expected to drop through the rest of the year without the tax credits that have been a key driver of EV sales. Tesla did not provide a full-year forecast. "While we face near-term uncertainty from shifting trade, tariff and fiscal policy, we are focused on long-term growth and value creation," the company said on Wednesday. Apart from the removal of tax credits and the waning sales of regulatory credits that traditional automakers bought to make up for their polluting vehicles, Tesla is also grappling with tariffs imposed by the Trump administration on auto-parts imports, which Chief Financial Officer Vaibhav Taneja said cost Tesla more than $400 million in the quarter. The EV maker flagged rising expenses in multiple areas, also including a 50% rise in operating expenses driven by AI and other research and development projects, and an increase in stock-based compensation. On an earnings conference call, Taneja said capital expenditures would rise substantially in 2026. "Tesla dished out just the right amount of good and bad news to both appease its fans while also providing enough evidence for its critics," Camelthorn Investments adviser Shawn Campbell told Reuters. "This earnings report isn't going to change anyone's mind on Tesla." To combat a demand drop, Tesla introduced lower-cost "Standard" variants of Model Y and Model 3 vehicles earlier this month, stripping out a myriad of premium and basic features and lowering prices by about $5,000 to $5,500. While Tesla hopes the cheaper variants will drive higher volumes, analysts warn the move will squeeze margins as thousands of dollars of cost cuts per vehicle may not fully compensate for lower selling prices. Tesla said it was on track to start volume production of its Cybercab robotaxi, Semi truck and Megapack 3 battery in 2026. Tesla's energy business also showed strength, including an 81% increase in storage deployment in the quarter, and its robot plans are advancing, with the first-generation production line of its Optimus humanoid robot being installed. The electric vehicle maker reported total revenue of $28.1 billion for the third quarter ended September 30, compared with analysts' average estimate of $26.37 billion, according to data compiled by LSEG. Profit per share in the third quarter was 50 cents, below analysts' estimates of 55 cents. Automotive regulatory credits, once a key driver of profit, fell to $417 million in the quarter from $739 million a year ago and $435 million in the second quarter. Tesla reported gross margin of 18%, compared with estimates of 17.5%. Its closely watched automotive gross margin, excluding regulatory credits, was 15.4%, compared with an average estimate of 15.6%, according to 19 analysts polled by Visible Alpha.  Tesla's limited rollout of its self-driving "robotaxi" service in Austin, Texas earlier this year marked a key strategic pivot, underpinning investor expectations that the company will transition from pure vehicle sales to focusing on self-driving technology. Musk on the conference call said he expected robotaxis to operate without safety drivers in large parts of Austin this year and that robotaxis would be operating in eight to ten metropolitan areas by the end of the year as well. Wall Street expects Tesla's deliveries in 2025 to fall 8.5% due to the expiry of the tax credit, reliance on older models and rising competition. CEO Musk's embrace of right-wing politics has also alienated some potential buyers. Some analysts remain skeptical of a strong rebound as the cheaper version could take away sales of more profitable premium vehicles. (Reporting by Akash Sriram in Bengaluru and Abhirup Roy in San Francisco; Editing by Anil D'Silva, Peter Henderson and Matthew Lewis)

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(Reuters) -Alphabet's Waymo said on Wednesday it will begin manual testing of its autonomous vehicles at Newark Liberty International Airport, as the firm looks to bring its robotaxis to one of the three main airports serving the New York City area. The robotaxi firm has grown slowly but steadily over the years in the United States despite tough regulations and expensive technology. Now, it is picking up speed through partnerships with ride-hailing platforms and fleet operators at a time when Tesla is rolling out its long-promised robotaxi service in the country. Waymo will carry out the testing with human drivers at the Newark airport in collaboration with the Port Authority of New York and New Jersey, it said in a post on X. Commercializing autonomous vehicles has proven difficult in the U.S. amid setbacks for several companies, including General Motors' Cruise, due to collisions, recalls and federal investigations. Waymo last week said it plans to launch its fully driverless ride-hailing service in London in 2026, looking to expand its footprint to major international cities. (Reporting by Juby Babu in Mexico City; Editing by Alan Barona)

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By Paul Sandle LONDON (Reuters) -OpenAI will offer Britain's government and businesses an opportunity to store data in the UK from Friday, helping unlock the potential of AI for more companies and public services, Deputy Prime Minister David Lammy will announce on Thursday. The plan, secured through OpenAI's partnership with the Ministry of Justice (MoJ), will enhance privacy and security as well as reinforcing resilience to cyber threats, the government said. Led by Sam Altman, OpenAI upended the tech industry with the launch of ChatGPT, its AI chatbot in late 2022. It signed a partnership with the British government in July to work together to use AI to improve public services. Lammy, who will announce the sovereign capability at the OpenAI Frontiers event, said AI was already improving efficiency in the MoJ. More than 1,000 probation officers would be equipped with Justice Transcribe, an AI tool that records and transcribes conversations with offenders, saving hours spent transferring notes into digital systems, he said. "By adopting AI, we're cutting the burdensome admin and ensuring frontline staff can spend more of their time doing the things only humans can do – monitoring offenders and protecting the British public," he said. OpenAI CEO Sam Altman said the number of people using its products in the UK had increased fourfold in the past year. "It's exciting to see them using AI to save time, increase productivity, and get more done," he said. UK data residency will be an option for customers using API Platform, ChatGPT Enterprise and ChatGPT Edu. OpenAI's Matt Weaver, head of EMEA solutions engineers, said pilot projects in the MoJ had sparked interest from other departments. "We expect adoption to accelerate now we've got the first deployment taking place," he said in an interview. ChatGPT, which competes with Anthropic, Perplexity and others as well as big tech companies like Google and Microsoft, on Tuesday announced ChatGPT Atlas, an AI-powered web browser built around its popular chatbot. Its arrival could accelerate a shift to AI-driven search as users seek tailored information rather than keyword-based results. (Reporting by Paul Sandle; editing by William James)

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By Akash Sriram and Abhirup Roy (Reuters) -Tesla  reported record third-quarter revenue that beat Wall Street estimates on Wednesday, driven by the highest quarterly sales of its electric vehicles as U.S. buyers rushed to lock in a key tax credit ahead of its expiry last month. However, Tesla's profit failed to live up to analysts' expectations, in part due to tariff and research costs, as well as a drop in income from regulatory credits that are expected to continue to fade away with recent legislation passed by the Trump administration. Tesla's $1.45 trillion valuation largely reflects investor bets on CEO Elon Musk's pivot to robotics and AI, but vehicle sales remain key to the financial stability of the company while those products are being developed. Shares of the Austin, Texas-based company were down 4% in extended trading. Demand for Tesla's vehicles and those of its rivals is also expected to drop through the rest of the year without the tax credits that have been a key driver of EV sales.  Apart from the removal of tax credits and the waning sales of regulatory credits that traditional automakers bought to make up for their polluting vehicles, Tesla is also grappling with tariffs imposed by the Trump administration on auto-parts imports, which Chief Financial Officer Vaibhav Taneja said cost Tesla more than $400 million in the quarter. The EV maker also reported a 50% rise in operating expenses driven by AI and other research and development projects, an increase in stock-based compensation, and on an earnings conference call, Taneja said capital expenditures would rise substantially in 2026. "Tesla dished out just the right amount of good and bad news to both appease its fans while also providing enough evidence for its critics," Camelthorn Investments adviser Shawn Campbell told Reuters. "This earnings report isn't going to change anyone's mind on Tesla." To combat a demand drop, Tesla introduced lower-cost "Standard" variants of Model Y and Model 3 vehicles earlier this month, stripping out a myriad of premium and basic features and lowering prices by about $5,000 to $5,500. While Tesla hopes the cheaper variants will drive higher volumes, analysts warn the move will squeeze margins as thousands of dollars of cost cuts per vehicle may not fully compensate for lower selling prices. Tesla said it was on track to start volume production of its Cybercab robotaxi, Semi truck and Megapack 3 battery in 2026. Tesla's energy business also showed strength, including an 81% increase in storage deployment in the quarter, and its robot plans are advancing, with production of humanoid bot Optimus hopefully starting toward the end of 2026, Musk said. The electric vehicle maker reported total revenue of $28.1 billion for the third quarter ended September 30, compared with analysts' average estimate of $26.37 billion, according to data compiled by LSEG. Profit per share in the third quarter was 50 cents, below analysts' estimates of 55 cents. Automotive regulatory credits, once a key driver of profit, fell to $417 million in the quarter from $739 million a year ago and $435 million in the second quarter. Tesla reported gross margin of 18%, compared with estimates of 17.5%. Its closely watched automotive gross margin, excluding regulatory credits, was 15.4%, compared with an average estimate of 15.6%, according to 19 analysts polled by Visible Alpha. Tesla did not provide a full-year forecast for production, but Musk said Tesla could expand production, given his confidence in self-driving software. Asked whether increasing production would require offering incentives and squeezing profit margins, Musk forecast "nutty" demand for the self-driving Cybercab and said margins would not be sacrificed. Tesla launched a limited rollout of its self-driving "robotaxi" service in Austin, Texas earlier this year. Musk also said he expected robotaxis to operate without safety drivers in large parts of Austin this year and that robotaxis would be operating in eight to ten metropolitan areas by the end of the year as well. In July, he had predicted Tesla robotaxis to serve about half the U.S. population by year end. Wall Street expects Tesla's deliveries in 2025 to fall 8.5% due to the expiry of the tax credit, reliance on older models and rising competition. CEO Musk's embrace of right-wing politics has also alienated some potential buyers. But many investors are deeply confident in Musk. Nancy Tengler, CEO and chief investment officer of Tesla shareholder Laffer Tengler Investments, said she was bullish on the next three to five years. "I'm less concerned about the next quarter," she said. "It's messy, it's hard, it's trial-and-error, it's try again. But this is a CEO who is determined. And I think what we've seen historically is that he will get it done" (Reporting by Akash Sriram in Bengaluru and Abhirup Roy in San Francisco; Chris Kirkham in Los Angeles; Editing by Anil D'Silva, Peter Henderson and Matthew Lewis)

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