Because Fitts's law relates both the target size and the target distance to the speed and accuracy of hitting the target. Not just the target distance. You can move the mouse very quickly to cover the large distance, without worrying about the accuracy, thus reducing the negative contribution of the distance, because the target size is practically infinite. The target area of the menu bar at the top of the screen extends infinitely up above the screen, because when your mouse hits the edge, it stops moving and stays in the target. Try it yourself. It's EXTREMELY easy to move the cursor to the top of the screen, no matter how far away it is. The distance doesn't matter, because the target size overwhelms it. That's what is meant by the "Mile High Menu Bar" -- calling it a mile high is an understatement!
This is also why pie menus have improved time and error rates over linear menus: linear menu targets are very small, and increasing distances away from the cursor, but the pie menu items all start out adjacent to the cursor, and extend all the way out to the screen edge, so you can trade off increased distance of movement for increased target size. The target area of the pie-slice shaped wedges get wider and wider as you move out further away from the menu center. (I don't mean they dynamically change size as you move, I mean that as you move out, you're in a much larger part of the slice. So with a four-item pie menu, each target area gets about 1/4 of the screen real estate, and you can keep moving the mouse even further when you hit the edge and still be in the same target slice.) Pie menus also minimize the distance, but around the center, the targets are at their smallest, but you can always move out further to get more "leverage" and directional accuracy.
This is also why pie menus have improved time and error rates over linear menus: linear menu targets are very small, and increasing distances away from the cursor, but the pie menu items all start out adjacent to the cursor, and extend all the way out to the screen edge, so you can trade off increased distance of movement for increased target size. The target area of the pie-slice shaped wedges get wider and wider as you move out further away from the menu center. (I don't mean they dynamically change size as you move, I mean that as you move out, you're in a much larger part of the slice. So with a four-item pie menu, each target area gets about 1/4 of the screen real estate, and you can keep moving the mouse even further when you hit the edge and still be in the same target slice.) Pie menus also minimize the distance, but around the center, the targets are at their smallest, but you can always move out further to get more "leverage" and directional accuracy.