Not sure I follow. Forgetting how the tool works, it's sold as a tool that outputs usable code for customers. If it's outputting copyright encumbered code (even occasionally), then Microsoft/Gitlab is going to be liable for that.
I don't think an explanation of how it's okay since it's an AI model is going to impress a judge, if the plaintiff shows long passages of verbatim copyrighted code coming out of it.