Being a potential defendant simply means VG could have included him as a defendant when taking action against Epstein.
That's how I read it. However, you would need a reason to believe you are a "potential defendant", otherwise that clause also applies to me, you and in fact anyone else alive in 2009.
So how does Prince Andrew demonstrate that this clause does indeed apply to him. And not me ?
One thing we know about the US legal system is (much like the UK one, at least when it comes to regular joes) that it really doesn't like the idea of a "get out of jail free" card. The debate over the possibility of Trump pardoning himself (albeit in criminal matters) seemed to make that clear.
My interest in this whole sorry tale is that it bring us imperceptibly closer to losing the entire medieval notion of a Monarch. Bearing in mind the Monarch gets a sneak preview at proposed legislation and a chance to make sure they are happy with it before the riff-raff in parliament have a look.