Which of the following are true?
(a) the legal industry is susceptible to influence and corruption
(b) engineers don't understand how to legally interpret legal text
(c) AI tech is new, and judges aren't technically qualified to decide these scenarios
Most likely option is C, as we've seen this pattern many times before.
Any reasonable reading of the current state of fair use doctrine makes it obvious that the process between Harry Potter and the Sorcerer's Stone and "A computer program that outputs responses to user prompts about a variety of topics" is wildly transformative, and thus the usage of the copyrighted material is probably covered by fair use.