Define "ethical AI". Does this "ethical AI" fall under Fair Use?

Fair use is a legal concept, and the test for determining if a use is fair is contained in the Copy- right Act of 1996. But fair use is also an ethical concept because it involves a determination of when it is fair to use someone's property.

It remains to be seen if the use of reference images and text prompts falls under fair use but I think it will depend on similar factors (how much a reference image is transformed). Fair use is considered to be ethical.

When I started making art using AI in 2016 there were no prompts, no text, no artist's names.