Reddit's AI scraping case against Perplexity and SerpApi moves into discovery as judge signals Oxylabs dismissal bid is unlikely to succeed

What happened

On 1 October 2026, U.S. District Judge Paul A. Engelmayer held an hour-long conference in the Southern District of New York in Reddit, Inc. v. SerpApi LLC, et al. (1:25-cv-8736), Reddit's lawsuit accusing SerpApi, Oxylabs, AWMProxy and Perplexity AI of industrial-scale scraping of Reddit content via Google search results, allegedly circumventing Reddit's anti-scraping defences and Google's "SearchGuard" protections in violation of the DMCA's anti-circumvention provisions. Inner City Press, reporting in person from the courthouse, said discovery will proceed — including into Reddit's agreement with Google and how Perplexity scrapes, over Perplexity's argument that this is irrelevant — and that discovery into the antitrust claims is not stayed. The judge told Oxylabs he is unlikely to grant its motion to dismiss, and set future dates including 5 April 2027, while offering a magistrate's services for settlement discussions.

The conference follows the court's 31 July 2026 ruling, which largely denied the defendants' motions to dismiss and allowed most of Reddit's DMCA and civil-conspiracy claims to proceed to discovery, while trimming one DMCA theory and dismissing the state-law unjust-enrichment and unfair-competition claims. In that ruling the court found Reddit's allegations sufficient: that SerpApi's system deploys a "server-swarm" to hide from or overwhelm Reddit's and Google's technological protections, and that Perplexity's role went beyond that of a bystander because it set parameters for the scraping activity.

Why it matters to creators

The case tests whether AI companies and the scraping intermediaries they use can be liable under the DMCA for bypassing technical protections to obtain user-created content at scale, rather than licensing it. Reddit users' posts and comments are the content at issue: the ruling lets claims proceed that scraping that content through intermediaries — disguising automated traffic as human users — harmed Reddit's copyrights, its users' privacy safeguards and its licensing market for that content. A case that survives dismissal and enters discovery strengthens the position of platforms and creators who want AI companies to pay for licensed access instead of obtaining content through scraping supply chains.

What is not yet known

No liability has been found: the July ruling only held that Reddit's allegations are sufficient to proceed, and the scraping and circumvention claims remain contested. Oxylabs' motion to dismiss is still pending despite the judge's signal, and it is not yet known what discovery into Perplexity's scraping practices and Reddit's Google agreement will establish, or whether the case will settle.