Stability always seemed like a dark horse thanks to the reputation of their founder and their open source business model. I do get some schadenfreude from seeing them like this considering the damage many feel they've done to the art community. E: -4 in 10 minutes. Stay classy hackernews. I hope this company and OpenAI choke on the algorithmic disgorgement when the law catches up.
The "art community" did most of the damage to itself.
While some of this are people practicing their artwork and I don't see any reason we should care what artwork someone practices on, this is also the general trend for artwork being sold. Go to any convention where artists sell work and look at how much artwork is sold of characters the artists do not have license to. While I think one can take a philosophical stance against the current IP laws that outlaw this, such a stance would make it quite hard to oppose the use of content in training an AI.
In short, if those making the AI stole IP to train the AI, it was stolen from a community that was fine with IP theft that benefitted them. And if the claim is that it wasn't IP theft because the law was generally tolerating it (as long as no one became so much a target they received a C&D), then unless there are some lawsuits won against the AI it would be equally allowed.
(And of course individuals will have their own philosophical stances which might be much more consistent, I'm speaking of the generalized view I have developed from overall interactions with parts of the community and as such it is not meant to be strongly prescriptive to any specific member of the community).