per Wikipedia

On September 21, 2022, Allen submitted an application to the us copyright office for registration of the image. Prior to the first formal refusal, the Copyright Office Examiner requested that the request would exclude any features of the image generated by Midjourney. Allen declined the request and requested copyright for the whole image.

So what I’m getting from that is his Photoshop edits aren’t significant enough to constitute a copyrightable work on their own and the copyright office was right to deem it a non-human production.