The software itself is not at issue here. If they had trained the network on public domain images then there’d be no lawsuit. The legal question to settle is whether it’s allowable to train (and use) a model on copyrighted images without permission from the artists.
They may actually be successful at arguing that the outputs are either copies or derived works which would require paying the original artist for licenses.
So humans can already run afoul of copyright this way, the bar for NNs might end up lower.