In reality Amazon is probably not aiming for a straightforward legal win.
They contracted him for four movies. He made one at the end of 2017 and then they said that they had to delay release because it wouldn't be welcomed in the current climate. Now, a year later, the delay has turned to a termination of contract. This is the longest Woody Allen has gone without working on a movie in a long time and he's 83 years old. He should probably be starting the third movie by now but he hasn't started the second. Amazon is probably going to have to release the movie they made but it will be done under a protest that will appease anyone who was ever going to be appeased by this piece of hypocritical legal chicanery, but they're probably counting on dragging this out until Allen dies or relents on trying to get the other three movies made.