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So there's two options, either the software is released GPL or they have no right to use the source and it's in violation and has to be resolved?

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Either they distribute the source code under a license compatible with the GPL (not necessarily the GPL itself), OR they are committing copyright infringement and must,

- negotiate a license,

- pay damages,

- some other remedy, OR

- nothing at all, if nobody with standing (meaning an author of decides to sue.

This last option is by far the most likely.

I don't get how anything "has to be resolved". The most likely outcome from this is "nothing changes from yesterday".

In practice, letting things run their own course ("nothing changes") one of the methods of resolving the issue, indeed.

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