It's partly about Netflix getting sued by someone claiming infringement, but also partly (maybe mostly) about Netflix maintaining their right to sue others for infringement.
The scenario looks like this:
* Be Netflix. Own some movie or series where the main elements (plot, characters, setting) were GenAI-created.
* See someone else using your plot/characters/setting in their own for-profit works.
* Try suing that someone else for copyright infringement.
* Get laughed out of court because the US Copyright Office has already said that GenAI is not copyrightable. [1]
In a legal case? You question the authors under oath, subpoena communications records, billing records, etc.
If there's even a hint that you used AI output in the work and you failed to disclose it to the US Copyright Office, they can cancel your registration.
The scenario looks like this:
* Be Netflix. Own some movie or series where the main elements (plot, characters, setting) were GenAI-created.
* See someone else using your plot/characters/setting in their own for-profit works.
* Try suing that someone else for copyright infringement.
* Get laughed out of court because the US Copyright Office has already said that GenAI is not copyrightable. [1]
[1] https://www.copyright.gov/ai/Copyright-and-Artificial-Intell...