You are right though, battling Microsoft in court will be no easy fight, and it will probably be a long one. However, I think the sharks are in the water and smell blood (money), as many lawyers see weaknesses in Microsoft's arguments and justifications (excuses).
Their FAQ also has some ambiguity on what it has been trained on:
> It has been trained on natural language text and source code from publicly available sources, including code in public repositories on GitHub.
I know "we don't own the source" came up before with OS/2, but I'm pretty sure Microsoft owns the bulk of Windows source code (maybe not in the hardware drivers department), but as I mentioned in another comment, it has trade secret protection, they simply have never published or licensed it.
And also on the unjust fella;
But chiefly on the just, because
The unjust hath the just’s umbrella."
Always think of this one whenever "the law applies equally to all" argument comes up.