This is just one action in a coming conflict. It will be interesting to see how this shakes out. Does the record industry win and digital likenesses become outlawed, even taboo? Or does voice, appearance etc just become another sets of rights that musicians will have to negotiate during a record deal?
Saying that Stable Diffusion was trained by “individuals” is a bit of a stretch, it cost over half a million dollars worth of compute to train it, and Stability AI is still a company in the end of the day. If that still counts as trained by individuals, then so does Midjourney and Dalle