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The New York Times sues OpenAI and Microsoft for copyright infringement
(edition.cnn.com)
This is a most excellent place for technology news and articles.
There is evidence to suggest some LLM's have the ability to produce original outputs, such as DeepMind's solution to the cap set problem.
https://www.nature.com/articles/s41586-023-06924-6
On the other hand LLM's have some incredible text compression abilities
https://arxiv.org/abs/2308.07633
I'm pretty sure there is copyright infringement going on by the letter of the law. But I also think the world would be better off if copyright laws were a bit more loose. Not wild-west anything-goes libertarianism, but more open than the current state.
I tend to agree with your last point, especially because of the way the system has been bastardized over the years. What started out as well intentioned legislation to ensure that authors and artists maintain control over their work has become a contentious and litigious minefield that barely protects creators.