[nonethewiser]

You misunderstand the point. You can think both or either are morally right/wrong or good/bad for society. But distilling a model and building one using information online are fundamentally different. Even of you think the information the frontier models used was not fairly accessed.

[maxloh]

I don't see any US labs suing their Chinese counterparts. It is practically impossible. That makes it a verbal battle, not a legal one.

From a strictly moral standpoint, it is illogical to state, "You stole things from my archive of stolen goods." LLM vendors need to morally own the knowledge before their accusations hold. It is unsound to claim ownership of something resulting from stolen property, regardless of the work you put into building it.

Either those accusations don't hold at all, all training is just "fair use", or the two processes you described are just different forms of "stealing."

Bottom line, even if we consider knowledge copyrightable, it is just stolen goods changing hands. You cannot claim ownership of a derivative work if you deny ownership to the sources your work was derived from. No one holds a higher moral standing than another.