from what I understand, the LICENSE file is supposed to be your license with your copyright header (if you're not directly using anything GPL and any code being used isn't superseding the MIT License). The copyright headers need to remain inside the code that you reproduced from that project in yours.

what you need to make is a secondary file called LICENSE_third_party.txt (or something similar) that contains all the license text from those libraries. (like https://raw.githubusercontent.com/gitpod-io/gitpod/main/License.third-party.npm.txt)

@Vyvy-vi I'm almost sure that I've seen a single LICENSE file with all licenses for code that was included in the project. I've thought that it was Gambit or Kawa, but they don't have such a file. I'm not sure what other big project could have something like this.

@Vyvy-vi found this question on StackExchange How to combine multiple LICENSE notes into single file?, the answer says:

One common pattern is to concatenate the different LICENSE in your own LICENSE file

that's an approach, however, doesn't that ambiguously imply to people using your application that they and you would also be subject to terms in the licenses of the libraries that you're using? (while most of the code you're using is under MIT, and thus doesn't really need you to include a license(only retaining the copyright headers put in there by authors) for them and doesn't conflict with your licenses, but in cases where someone was using something like Apache it might cause confusion because Apache has some different terms than MIT.)

*in cases where a large share of the project directly uses someone else's code, modifies it and re-distributes it (derivative work) you'd need to share the copyright headers in your MIT License, and mention what's used from their project. eg:

Copyright (c) 2016 [XYZ], author of [project] modified in [your-project]
Copyright (c) 2011-2021 Jakub Jankiewicz

This is what I've used in my other project https://github.com/jcubic/lips/blob/master/LICENSE
I've included all licenses intact even though they are the same MIT license.

Well, then I guess that's the way to go 👍