IMO this doesn't really capture fully what AI is or does. It is possible to use AI to create artwork that has never been seen before and that is not derivative of an artist that already exists. I've used it myself for my own photos and drawings. It understands the basics of art like composition, lighting, the physics of things to some extent and all of this it uses in the art it creates.
The problem is that copyrighted material is intermingled with non-copyrighted material in a way where it's not obvious how to solve it. But I think in this case, AI is so powerful that we should (gasp) cut it some slack. This would be the perfect example of throwing the baby out with the bathwater if OpenAI were to be sued into oblivion.
LLMs are still missing a part of working memory. Part of working memory is being able to attend to small amounts of information and then understand and parse all the pieces of that information. When LLMs use their "working memory" they just analyze different probabilities of tokens and there is no prioritization or understanding of the information in the way humans have it.
If there is no training data or data in the context that leads it to the correct result then it can't do it, whereas a human seems to be able to generalize and abstract a goal and then repeat an action or thought process in a 'recursive' manner to reach the result. AFAIK LLMs don't do this.
Just as an example to illustrate. I recently asked an LLM to organize a bunch of artists albums into whether they were released by a major label or an independent label, and for the most part it did a good job. But there were albums that it classified as independendent that weren't. I presume because it either didn't run into the right data when searching or it misunderstood the data it did find. A human would not do this because if a human had a list of all major labels, it could instantly detect whether an album was or wasn't indie, because it doesn't do any complicated parsing or token probabilities that LLMs do, it just recognizes a pattern (either an album is indie or it is not, a human brain needs simply one piece of information to decide this), an LLM is not that simple.
In a way human brains are simpler than LLMs. The algorithms it runs mentally can detect a piece of information and then see most / all of the consequences of that information whereas an LLM thrawls through megabytes of text and does a token probability distribution and so on without any simplicity.
The problem is that copyrighted material is intermingled with non-copyrighted material in a way where it's not obvious how to solve it. But I think in this case, AI is so powerful that we should (gasp) cut it some slack. This would be the perfect example of throwing the baby out with the bathwater if OpenAI were to be sued into oblivion.