Published on

'I think this will end bad for Pocketpair': Analyst says Nintendo's 'feared' legal team wouldn't sue Palworld unless it was confident of victory

Industry analyst Serkan Toto believes Nintendo is likely to win its lawsuit against Palworld developer Pocketpair, citing Nintendo's strong legal team and track record of success in similar lawsuits, and predicts a hefty payout for Nintendo, potentially reaching hundreds of millions of dollars.

Cover

Nintendo wouldn't sue Palworld unless it was pretty sure it could win a hefty chunk of the survival game's "hundreds of millions" of revenue, says one industry analyst who knows just how scary the Nintendo legal team is.

Speaking to GamesRadar+ about Nintendo's Palworld lawsuit, analyst Serkan Toto points out that "Nintendo is famously protective of its IP, and they have a very, very strong legal team that is feared in the Japanese gaming industry. You don't want to make Nintendo angry." That team's strength is part of why it's taken so long for this lawsuit to rear its head. It's been seven months since Palworld launched, and Toto posits that in that time, "Nintendo wanted to be absolutely thorough. They didn't want to shoot from the hip."

"[They wanted to] make absolutely sure that everything is mapped out, that they have counter-arguments against anything that Pocketpair will say in court, and only if they are able to build a really strong case where they think they are going to win, they will file the lawsuit. And I think that Nintendo is going into this lawsuit thinking that they're going to win. And I fear, looking at the track record, it's highly likely that they win."

Toto claims he "cannot really remember a single lawsuit that Nintendo itself initiated in Japan that they lost. I think they won every single one of them." While there's a first time for everything, he also thinks that "this will end bad for Pocketpair," and that Nintendo will be coming for as much money as possible from the company. 

That could be a fee in the tens of millions of dollars, if not more. In 2021, Nintendo settled a similar patent lawsuit with mobile developer Colopl that netted it ¥3 billion (around $21 million). Until we know more about which patents Nintendo is chasing (and how many of them), we're unlikely to get any sense of how this might play out, but Toto thinks Pocketpair will look to settle (though the company has pledged to take on the lawsuit). That would involve handing over a chunk of what the analyst thinks amounts to "hundreds of millions of dollars, easily." Palworld's massive sales and its limited development costs linked to low Japanese salaries and the game's limited graphical fidelity mean that Pocketpair is sitting on a mountain of cash that it's not been planning to use for massive expansion projects.

*While Toto believes Nintendo's certain of victory, *other experts think "Nintendo may be reaching" in its Palworld lawsuit.