In fairness, Diffusion is arguably a very complex entropy coding similar to Arithmetic/Huffman coding.
Given that copyright is protectable even on compressed/encrypted files, it seems fair that the “container of compressed bytes” (in this case the Diffusion model) does “contain” the original images no differently than a compressed folder of images contains the original images.
A lawyer/researcher would likely win this case if they re-create 90%ish of a single input image from the diffusion model with text input.