[jmward01]

If 'distillation' means training on outputs then what is the legal concept of ownership of outputs? And, more broadly, is this something that could be skirted by doing it in different countries that have different legal structures? Basically, are they saying they own those outputs, not the companies that paid for the tokens, and only they can train on them? I suspect a lot of companies are saving their token histories and using them to fine tune internal models.

[nradov]

The legal concept is that LLM vendors can put pretty much whatever they want in their terms of service, and cut off or sue clients who violate those terms. They have the right to refuse service to anyone for any reason (or no reason at all).