1. Google's unauthorized digitizing of copyright-protected works, creation of a search functionality, and display of snippets from those works are non-infringing fair uses. The purpose of the copying is highly transformative, the public display of text is limited, and the revelations do not provide a significant market substitute for the protected aspects of the originals. Google's commercial nature and profit motivation do not justify denial of fair use.
2. Google's provision of digitized copies to the libraries that supplied the books, on the understanding that the libraries will use the copies in a manner consistent with the copyright law, also does not constitute infringement. Nor, on this record, is Google a contributory infringer.
Focus on the protected aspects of the originals. This would be their expressions. Unless an LLM is reproducing the exact expression and not merely the idea, then there is no market substitute. The market substitute for a Picasso painting is the facsimile of one of Picasso's actual paintings, not just some other cubist artwork.
I get that there's case law on copying in memory on the input side not being infringing but can't for the life of me understand how they get away with not paying for it. At least libraries buy the books before loaning them out, OpenAI and midjourney presumably pirated the works or otherwise ignored the license of published works and just say "if we found it on the internet it's fair game"