I wonder how they address the issue of copyright I have seen some Youtube videos being downloaded and uploaded on LBRY by another uploader, do they have a system that can flag the content that is copyright materials, and what penalties they imposed on members that are stealing other people's content from other platforms.
Any content that uploaded within the application controlled by LBRY Inc, will follow the DMCA rule. So any copyright infringement will be handled. The right owner could file a DMCA takedown request directly from their application like LBRY desktop and/or Odysee.
On the other hand, do note that the LBRY protocol is censorship-resistant, as long as someone still keeps/seeds the file, anyone still can access the file within the protocol.
Regarding full information about it, I suggest you read their FAQ page about the concern:
https://lbry.com/faq/dmca