Why did Anthropic settle with authors for 1.5 billion then? Surely their lawyers must have decided there's a pretty good chance of judges ultimately deciding that it is copyright infringement?
Anthropic settled because even though the training is fair use, Anthropic did not acquire all of the training material through legal means.
You could also ask why the other side agreed to that settlement. It's not a one-way street.
It was about piracy, though? Not fair use.
What does that matter? They were sued and the group suing them accepted at $1.5B settlement instead of something theoretically much larger and precedent-setting.
Because the judge ruled that using the books for training was "fair use". The issue was Anthropic downloading and storing pirated content and there is quite a bit of precedent regarding that already...
If a case is settled by the parties, it cannot be cited as establishing precedent.