That means what the AI created is new (not always) but also not copyrightable. What will vibe coding companies do when they realize none of their software is protected by copyright? A EULA can’t prevent the use of public domain works. (In reality everything will increasingly move server side and no one will be able to access anything resembling code anyway).
That's another way courts could go. But once again that would make life very hard for billionaires. So not a chance.