Asmongold TV's video on PalWorld's recent complaints (summary inside)
(www.youtube.com)
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Bluntly, AI image creation is in a very grey area in copyright. Any argument can be used against tracing, similar styles, and even parody. It’ll take a big company to take up the mantle but it could prevent the same company from using the tech themselves. It’s an interesting legal shock that might not even end with a resolution for years.
I agree that it's a genuinely vague area of law. However, I think the finished product speaks to the fact that the figures themselves are transformed enough to be different without infringing on anyone's property rights.