---
title: "China's First AI-Ghostwritten 'Seeding Post' Case — a Duty of Care for Generative-AI Providers"
author: "DCC Editorial"
published: 2026-06-08T03:00:00.000Z
modified: 2026-06-08T07:30:00.000Z
url: https://datacompliancechina.com/posts/ai-seeding-post-unfair-competition-case/
description: "China's first unfair-competition case over AI batch-ghostwritten 'seeding posts' (种草笔记 — the staged, first-person product-recommendation notes that drive discovery commerce on Xiaohongshu/RED). On appeal, the Hangzhou Intermediate People's Court ((2025) Zhe 01 Min Zhong No. 3998) held that the operators of an 'AI writing' tool ('AI写作鹅') that let users one-click-generate fake first-person Xiaohongshu notes — fabricating personal experiences and feelings — committed unfair competition under Article 2 (the general clause) of the Anti-Unfair Competition Law. The court built an explicit four-factor duty-of-care test for generative-AI providers (is it generative AI; does it target a specific scenario/another's product as its 'application layer'; is it directional and inducing; is it a paid, for-profit service), citing Articles 4(3), 5(1) and 22 of the Generative AI Services Interim Measures. Because the tool was named after Xiaohongshu, marketed to mass-produce on-brand 'seeding' copy, charged a membership fee, and shipped with no notice or reminder against the foreseeable misuse, the providers were at fault. The appeal court affirmed liability but cut damages from RMB 200,000 to RMB 100,000 on an 'inclusive and prudent' (包容审慎) view of AI, and reversed joint liability for the third defendant that merely hosted the download. DCC OCR'd the full judgment from the source images; this is our case brief for overseas counsel."
tags: ["ai-governance", "generative-ai", "unfair-competition", "ai-generated-content", "fake-reviews", "duty-of-care", "judicial-case", "xiaohongshu", "enforcement"]
laws_cited: ["genai-services-interim-measures", "ai-content-labeling-measures"]
domains: ["ai-governance", "enforcement"]
account: "shuju-fameng"
original_title: "全国首例AI代写“种草笔记”案判决书"
original_author: "知产库"
original_publication: "数据法盟（转自知产库）"
original_url: "https://mp.weixin.qq.com/s/wL3o6iLLzMSB7UWNct7XyQ"
source_language: "zh"
---
> *Editor's Note — DCC.*
>
> This is DCC's case summary of China's first unfair-competition action over
> AI-ghostwritten "种草笔记" (seeding posts) — the second-instance judgment of the
> **Hangzhou Intermediate People's Court (杭州市中级人民法院)**, case no. **(2025) Zhe 01
> Min Zhong No. 3998**, on appeal from the **Hangzhou Internet Court** ((2024) Zhe 0192 Min
> Chu No. 3396). The judgment was circulated as ~44 page-images by the **数据法盟** channel
> citing **知产库**; **DCC ran OCR over those images** and summarises the court's findings
> and holding below. In the circulated copy the **defendant companies' names are redacted
> ("XX")**; the plaintiff is named. All English renderings of the court's language are
> DCC's. The framing for overseas counsel is ours.

## Case at a glance

- **Plaintiff (respondent on appeal):** Xingyin Information Technology (Shanghai) Co., Ltd.
  (行吟信息科技（上海）有限公司) — the operator of **Xiaohongshu (小红书 / RED)**.
- **Defendants (appellants):** the operators of the **"AI写作鹅" ("AI Writing Goose")** tool —
  two Hefei companies (names redacted) plus a third company that distributed the app via the
  "单词乎" (dancihu.com) site.
- **Claims:** (1) copyright infringement and (2) unfair competition.
- **Result:** copyright claim **rejected**; unfair competition **established** under Article 2
  of the Anti-Unfair Competition Law (反不正当竞争法). On appeal: liability **affirmed**,
  injunction **upheld** (reworded), damages **reduced from RMB 200,000 to RMB 100,000**, and
  the download-distributor's **joint liability reversed**. Final judgment.

## What the service did

"**Seeding posts**" (种草笔记, lit. "planting-grass notes") are the staged, enthusiastic,
first-person product-recommendation notes that drive discovery commerce on **Xiaohongshu**.
Their persuasive power depends on the reader believing they reflect a real user's genuine
experience.

The "AI写作鹅" tool offered modules named **"小红书种草文案" (Xiaohongshu seeding copy),
"小红书旅游攻略" (Xiaohongshu travel guides), "小红书文案", and "小红书笔记标题"
(Xiaohongshu note titles)**. A user could enter a few keywords and **"one-click create"** a
complete Xiaohongshu seeding post; the output **fabricated the user's first-hand experience
and genuine feelings**. The tool was a paid service after first use (the court noted
membership prices of **RMB 168 lifetime / 98 a year / 40 a month**), and its pages advertised
that it would "generate click-inducing titles for your Xiaohongshu notes" and "produce share
articles that fit Xiaohongshu's tone."

## Two claims, two outcomes

**Copyright — rejected.** Xingyin asserted copyright (via its user-agreement licence) in
platform content and pointed to one example post copied into the tool and regenerated. The
court found the **object of the claim unclear**: the example copy-and-upload was actually
Xingyin's own act during evidence collection, not the tool operator's, and a blanket claim to
"all content on the platform" did not identify a specific work or establish authorship and
originality. So the copyright claim failed.

**Unfair competition — established under the Article 2 general clause.** Notably, Xingyin did
**not** plead confusion (AUCL Art. 6) or false advertising (AUCL Art. 8); it invoked the
**general clause, Article 2**, which courts apply to conduct that is not specifically
enumerated in Chapter 2 but breaches good faith and commercial ethics. Because the case was
about whether a *generative-AI product at the application layer* disrupts an existing content
ecosystem — something Chapter 2 does not address — the court (both instances) analysed it under
Article 2 across three questions: does the plaintiff hold a protected interest; is the conduct
improper; does it cause harm.

The protected interest was the **authentic "seeding" content ecosystem of Xiaohongshu** — a
UGC community built on real user experience. The court credited Xingyin's heavy, sustained
investment (community rules and conventions, a "Woodpecker" anti-fake-promotion campaign,
governance reports, and express bans on "using AI to fabricate usage experience or effect"),
and the resulting traffic and stickiness (by figures in evidence: 20M+ monthly-active creators
and 30B+ daily note impressions by early 2023; ~300M monthly-active users by 2024, ~90% UGC).
That ecosystem-based competitive advantage, it held, is protected by the AUCL.

## The heart of the case: a duty of care for generative-AI providers

The most consequential part of the appeal judgment is an explicit framework for **when a
generative-AI service provider owes, and breaches, a duty of care**. The court stressed that
generative AI has a **dual nature** — technical service *and* content supply — unlike a
traditional search-link or hosting provider, and that its output is **non-deterministic**
(each generation differs), so infringement risk is "highly random" and the provider must build
in reasonable measures to avoid or reduce it. It then weighed four factors:

1. **Is it generative AI?** Citing **Article 22** of the Generative AI Services Interim Measures
   (definition of generative-AI technology), the court found "AI写作鹅" autonomously generated
   new content from user prompts via its own model, algorithms, compute, and training data — so
   it is a generative-AI service, and its provider bears the corresponding duty of care.
2. **Does it use a specific scenario / another's product as its "application layer"?** The
   modules were named after **"小红书" (Xiaohongshu)** — a service "designed as a directional
   scenario oriented to another's product." A provider that uses Xiaohongshu as its application
   layer should be **bound by Xiaohongshu's platform rules**, which do not ban AI but do ban
   using AI to fabricate experience or effect; the tool's "seeding" output was, in substance,
   AI-powered "**fake seeding**" (虚假种草) that violated those rules.
3. **Is it directional and inducing?** Citing **Article 5(1)** of the Measures (encourage
   innovative AI applications that generate "positive, healthy, uplifting" content), the court
   read the tool's marketing ("generate click-inducing Xiaohongshu titles," "share copy matching
   Xiaohongshu's tone") plus the "one-click" fabricated output as showing a subjective purpose to
   supply fake seeding — so the provider "**can hardly be said to be in good faith**" (难谓善意).
4. **Is it a paid, for-profit service?** Because the tool charged a membership fee — unlike free,
   general-purpose generative-AI platforms — the court held it should bear a **higher duty of
   care**.

Putting it together: the providers **should have foreseen** that a Xiaohongshu-targeted,
directional, inducing, paid tool would lead users to generate fabricated seeding posts and
publish them to Xiaohongshu — yet they **took no reasonable, necessary notice or reminder
measures** (告知、提醒). That failure meant they did **not discharge the reasonable duty of care
of a generative-AI provider** and were **at fault (过错)**; the conduct violated good faith and
commercial ethics and was therefore unfair competition. The court was careful to add that the
duty of care must **match the provider's technical control capability** and not be so heavy as
to deter innovation.

The court also drew a boundary: this case is **not** about regulating platforms that offer AI
"seeding copy," "travel guides," or general text generation. "AI technology itself is neutral …
but that does not mean its *application* is neutral"; what is regulated is a provider that, **at
the application layer, designs a scenario targeted at another operator's product and improperly
free-rides on the market results that operator has already achieved** — guided by the principles
of governing AI "according to law" and "AI for good" (智能向善), and an **"inclusive and prudent"
(包容审慎)** posture that dynamically balances innovation, rights-holders, consumers, and the
public interest.

## What changed on appeal

The Hangzhou Intermediate Court **affirmed liability and the injunction** (reworded to "stop
*providing*, via AI写作鹅, the 'Xiaohongshu seeding copy / travel guide / copy / note title'
services"), but made two modifications:

- **Damages cut from RMB 200,000 to RMB 100,000.** With no proof of actual loss or infringer
  gain, Xingyin sought statutory damages. The appeal court trimmed the award, expressly because
  AI legislation and industry norms remain immature and courts should stay "inclusive and
  prudent," and because the harm was unproven — while still holding the providers at fault.
- **Joint liability of the download-distributor reversed.** The third defendant ran the
  "单词乎" (dancihu.com) site and merely offered the app's Android download and an iOS link — a
  network service. With no evidence of common intent or knowledge (the tool also had general
  "AI writing" and "AI drawing" features), the court found **no fault** and **no joint liability**,
  allowing that defendant's appeal. Liability rests on the two Hefei operators of the tool.

(Legal basis: AUCL Articles 2 and 17; Article 23 of the Supreme People's Court Interpretation on
the AUCL; Civil Procedure Law Articles 67 and 177. The judgment is final.)

## Why overseas counsel should care

- **Generative-AI providers in China carry an affirmative, scenario-sensitive duty of care.**
  The four-factor test is the takeaway: a tool is most exposed when it (i) is generative AI,
  (ii) targets a specific platform or another's product as its "application layer," (iii) is
  marketed in a directional, inducing way, and (iv) is monetised. Tick those boxes and a Chinese
  court will ask what **notice, reminder, and abuse-prevention** measures you built in.
- **Naming and marketing are evidence.** Naming features after a third-party platform was treated
  as "free-riding," and promotional copy was read as proof of intent. Align product names and
  marketing with permitted-use claims; do not brand a feature on someone else's ecosystem.
- **Build guardrails into the product, and weigh your business model.** A **paid** service drew a
  *higher* duty of care. Pair the regulatory duties under the
  [Generative AI Services Interim Measures](/laws/genai-services-interim-measures/) and the
  [AI-content-labelling Measures](/laws/ai-content-labeling-measures/) with product-level controls
  — usage warnings, content labelling, and friction or refusal for deception-prone prompts.
- **The general clause (AUCL Art. 2) is the live instrument for AI-content harms.** With no
  enumerated tort to fit, Chinese courts are using the good-faith / business-ethics general clause
  to reach novel AI conduct — and reading the **Generative AI Measures into the standard of
  commercial ethics**, even where the case is decided on competition grounds.
- **"Inclusive and prudent" cuts both ways.** It produced liability *and* a reduced award; expect
  Chinese courts to find fault but moderate damages while the AI rulebook matures — useful for
  calibrating litigation risk.

## DCC sources

- **Original:** 《全国首例AI代写"种草笔记"案判决书》, circulated by the **数据法盟** channel citing
  **知产库** — [mp.weixin.qq.com](https://mp.weixin.qq.com/s/wL3o6iLLzMSB7UWNct7XyQ). Underlying
  decision: **Hangzhou Intermediate People's Court, (2025) Zhe 01 Min Zhong No. 3998** (second
  instance; first instance Hangzhou Internet Court, (2024) Zhe 0192 Min Chu No. 3396); reported by
  CCTV, May 2026. DCC reconstructed the text by OCR over the judgment images.
- **Cross-references on DCC:** the [Generative AI Services Interim Measures](/laws/genai-services-interim-measures/)
  (Arts. 4(3), 5(1), 22, cited in the judgment) · the
  [Measures for Labelling AI-Generated and Synthetic Content](/laws/ai-content-labeling-measures/)
  (the regulatory analogue of the "notice/labelling" duty the court found missing).
- Part of the [AI Governance](/domains/ai-governance/) and [Enforcement](/domains/enforcement/)
  domains on DCC.

> This is an editorial case summary written in DCC's own words for overseas readers, reconstructed
> from OCR of the judgment images circulated with the source post — not an official transcript or
> a certified translation. Defendant names were redacted in the source; quoted phrases are short
> and attributed. Figures and holdings are as DCC read them from the images and may contain OCR
> error. **Not legal advice.**