The test was conducted as such:

>With these two evaluation sets, we conducted a blind pairwise comparison by asking approximately 100 evaluators on Amazon Mechanical Turk platform to compare the quality of model outputs on these held-out sets of prompts. In the ratings interface, we present each rater with an input prompt and the output of two models. They are then asked to judge which output is better (or that they are equally good) using criteria related to response quality and correctness.

No, it's not just memorising shakespeare, real humans interacted with the models and rated them.