The legal ruling against the Internet Archive has come down in favour of the rights of authors.
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The applicable Supreme Court precedent here is Allen v. Cooper. The State of North Carolina published all pictures of a shipwreck within its custody on its website as “public record” and the photography firm that owned the copyright sued. The Supreme Court ruled that Congress cannot abrogate a state’s sovereign immunity under its Article I legislative powers and thus ruled in favour of the state.
That case is still being litigated:
https://ipwatchdog.com/2023/02/23/allen-v-cooper-back-queen-annes-vengeance/id=156986/