I agree with @ucbalumnus on all points especially the comment re: institutional research. TBH, from UC POV, it seemed like easy “gives” for the settlement.
As described in this thread Parents of the HS Class of 2024 - #68 by pathandpurpose), I had watched the May 2020 UC Board of Regents deliberations on moving away from SAT and ACT.
I had also watched the Jan 2021 UC Board of Regents on the feasibility of developing a replacement test by 2025. This article After dropping SAT and ACT, University of California urged not to add new admissions test | EdSource predates the Jan 2021 meeting; this article discusses the meeting with some UCLA faculty reaction
UC considers alternatives to standardized testing in admissions process - Daily Bruin