Microsoft and Epic Games are facing criticism over their use of copyright takedowns against AI-assisted game recreations, even as both companies embrace artificial intelligence in their businesses.
A report published by Kotaku on 26 October 2026 highlights the tension between publishers protecting their intellectual property and the growing use of AI tools that can reproduce or rebuild existing games.
The dispute has intensified as developers use AI coding tools to create browser-based ports and rebuild games for hardware they were not originally designed to support.
The technology is also raising concerns for independent studios whose work can be reproduced without permission, potentially leaving smaller developers with fewer resources to defend their intellectual property.
Microsoft And Epic Games Target AI Game Recreations
Kotaku reported that hundreds of Digital Millennium Copyright Act (DMCA) notices had been issued by companies responding to a wave of AI-assisted game recreations. Among the projects appearing in GitHub's copyright records were open-source versions of Slay the Spire 2, Celeste and RimWorld.
The original games did not contain generative AI content, Kotaku noted. Their developers had not authorised the recreations, raising concerns about how easily AI tools can be used to reproduce existing games without their creators' permission.
Microsoft And Epic Games Suddenly Agree That AI Is Theft https://t.co/YRiPvc0Kyc https://t.co/YRiPvc0Kyc
— Kotaku (@Kotaku) October 26, 2026
Epic Games issued a DMCA notice against a browser-based recreation of Fortnite on 10 October. Microsoft also pursued takedowns involving browser versions of Minecraft, Call of Duty and Halo during the preceding month, according to the report.
Both companies are investing in AI, with Microsoft offering Copilot and Epic reportedly planning a Disney and Marvel game using Anthropic's Claude. The takedowns raise questions about whether publishers apply consistent copyright standards when AI threatens their own interests.
Epic Games' AI Rules Raise Copyright Questions
Epic's terms of service prohibit users from using code or content extracted from its licensed products as training input for generative AI programmes. The restriction also covers prompt-based input when the AI system trains on that material.
The provision illustrates Epic's determination to control how its intellectual property is used. However, the existence of the restriction does not establish that the company has breached copyright law through its own AI activities.
Epic CEO Tim Sweeney criticised AI companies for using pirated training data in a June 2026 interview. His comments have drawn scrutiny as Epic reportedly plans a Disney and Marvel game using Anthropic's Claude, which settled a piracy-related lawsuit for $1.5 billion in July 2026.
The settlement required the destruction of pirated books but did not require Anthropic to delete or retrain its AI models.
The case therefore does not establish that every AI model trained on copyrighted material is unlawful. Nor does Epic's reported use of Claude, by itself, establish that the company has infringed copyright.
Microsoft's AI Strategy Faces Its Own Scrutiny
Microsoft has also faced questions about the relationship between its AI ambitions and its public commitments to protecting intellectual property.
In an internal communication disclosed during litigation involving The New York Times, Microsoft and OpenAI, Microsoft director of applied sciences Brent Hecht warned that creators could view AI models using their work as 'an astonishing theft of unprecedented proportions'.
Another memo cautioned that AI could undermine the online content ecosystem, even as Xbox chief executive Asha Sharma reaffirmed Microsoft's commitment to being 'responsible stewards of IP' on 13 October.
Sharma's announcement introduced Xbox Labs, a group tasked with exploring emerging technology and new ways for players to access and create games.
She acknowledged that AI-assisted recreations could challenge existing business models while making games more accessible. However, unauthorised recreations could leave smaller studios facing costly legal challenges, highlighting the industry's struggle to balance AI innovation with intellectual property rights.
