I agree. Maybe they should split into separate judiciary entities?

This is nonsense. A great many of Internet Archive's in-house scanned books weren't previously available on shadow libraries; many of the Internet Archive scans have meaningful differences from the digital copies available elsewhere; & much of the shadow libraries' collections actually came to them from the Internet Archive. In the case of Anna's Archive specifically, they conducted a massive scrape of IA's library.

I think the legalist approach IA is taking was always doomed, but the enormous resources at their disposal allowed them to do a lot of collecting that other efforts have & will continue to benefit enormously from.