I believe there is no requirement to process any spillover, but there is an administrative requirement to process in a timely fashion, which seems to be defined as 18-24 months before
lawyers advise filing mandamus writs. The weakest part of the case to me seems that the judge could say processing in 2 years is timely and it's too bad the spillover visas are lost. But I think the agency has to present an administrative record showing a good faith effort that they did try to process visas. I don't think USCIS can just say we only process 140k EB GCs/yr and that's it because there is congressional intent to preserve unusued FB visas (hence the spillover to EB and then the reverse spillover to FB, which unfortunately goes waste due to quirk).