No, that's totally incorrect, we do not consider every observation a "transformative use" as applied to the human mind. If you memorize a copyrighted play and write another play it is NOT inherently a copyright violation of everything which has come before. We just don't do that.

The new play is judged as to its originality.

People who have seen a play (everybody) are allowed to write new plays which aren't beholden to the copyright of the first play they've ever watched.