Reddit Accuses Perplexity, Other 'Data Scrapers' Of Stealing

Reddit Inc (NYSE:RDDT) filed a lawsuit Wednesday accusing four companies of illegally stealing its data by scraping Google search results containing Reddit content, according to The New York Times.

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The suit, filed in U.S. District Court for the Southern District of New York, targets SerpApi, Lithuanian start-up Oxylabs, Russian company AWMProxy and San Francisco-based Perplexity. Three of the companies allegedly sold scraped data to AI companies including OpenAI and Meta, while Perplexity operates its own AI search engine.

“Recognizing they lack permission to access the data directly from Reddit, defendants have devised a scheme to scrape the data from Google’s search results,” the lawsuit states.

The companies allegedly mask their identities and disguise web scrapers as regular users to bypass technical restrictions at industrial scale.

Reddit, used by over 416 million people weekly, hosts discussions spanning diverse topics, making it particularly valuable for improving AI chatbot natural language capabilities.

In 2023, Reddit began charging for data access and established licensing agreements with Google for its Gemini chatbot and OpenAI for ChatGPT. The report indicates that some companies allegedly evaded these deals through scrapers.

Perplexity previously scraped Reddit without paying for it, but agreed to stop after receiving a cease-and-desist from the company. However, citations to Reddit data in Perplexity results jumped “fortyfold,” according to the lawsuit.

New York Times reported that Reddit created a “trap” for Perplexity by posting test content that could only be accessible to Google's search engine and was otherwise not obtainable. Within hours, that content surfaced in Perplexity search results, the lawsuit states.

Reddit said it has invested “tens of millions of dollars” in anti-scraping systems. The company is seeking a permanent injunction, financial damages and prohibition of any use or sale of previously scraped Reddit data.

RDDT Price Action: Reddit shares were down 5.98% at $193.41 at the time of publication on Wednesday, according to Benzinga Pro.

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