You cannot have GPL-licensed code in closed-source code. It's a violation of the license so the code ceases to be GPL-licensed and becomes unlicensed. If you distribute that code, in source or binary form, you can get sued by the copyright holders which is what this case is about.
Indeed the code only becomes unlicensed as soon as you violate the GPL terms. So I guess the correct way of framing this would be that internal copies, including changes, are still under the GPL.
Then it's licensed under some other license and the GPL does not apply. If I rent a building and the building is for sale I still don't own it until I close that contract.
If I copy GPL-licensed code without following the license terms, the GPL no longer applies and the code becomes unlicensed. The GPL is explicit about that.
If I acquire code under another license than the GPL my copy is not GPL-licensed even if it's available under the GPL license. Ultimately, the GPL requires that all people who pass on code under the GPL adhere to its terms. If one person in the chain didn't (for example by not making available the source) all subsequent copies become unlicensed.
