Google owns a LOT of videos on YouTube. The fact that people are able to easily get them out and put it somewhere else threatens them. So, they used their friends to cook up this lawsuit.
Unfortunately for them, this upset a lot of GitHub users and Microsoft didn't want to help Google while taking a hit themselves... so they found a way around it.
Corporations use their legal prowess to advance their bottom line all the time... and many a times, how it's framed in public is very different from what is actually going on.