The details are still up in the air, but 404media has chimed in with a legal expert on this deplorable situation. They mostly talk about what damage this could do, and how Nintendo has never lost a lawsuit, but I found this to be an interesting key point

https://www.404media.co/cold-blooded-business-nintendo-is-patent-trolling-palworld-because-it-got-too-big/

Nintendo has, as I mentioned in my tweet, a legendary track record. I think they never lost a lawsuit that they initiated themselves, and under the Japanese legal system, seven years ago, they sued a company called Colopl, which is a mobile gaming powerhouse from Japan. They [Colopl] have, I think, almost 2,000 [employees], nobody but knows them outside Japan but they had a famous mobile game called White Cat Project, not copying Mario, not copying Pokémon, not copying Zelda, nothing at all. Nintendo brought forward six patents that they thought that this company was violating inside their very successful mobile game at one time. It was one of the most popular mobile games in Japan, and they built a huge case. One of the patents was for a confirmation screen after sleep mode. You know when devices are sleeping and you want to resume there's a confirmation screen in a lot of games? “Are you sure you want to resume?” And then you tap yes or no. Nintendo has a patent on that, and this game uses it. And then Nintendo said, you know, look, you're using our patent and you cannot do that. You're not paying us any licensing fees.

And they had five other ones, including one for isometric, pseudo, 3D games, when the character is hidden behind the tree, the game forms a shadow, so you have a kind of sense for where the character is, even though you don't see the character clearly. Nintendo has a patent on that, and this game uses that technology. And Nintendo said, look, you cannot do this. And this goes on with four other patents, right?

So they had this legal battle. Colopl said, no way, but in 2021 they had a settlement where Nintendo got the equivalent of $20 Million US dollars and Colopl is now paying licensing fees to Nintendo for continuing to use the patents inside their mobile game. So it was a complete win for Nintendo, even though it was technically a settlement. I personally think you will see that after a few years, Nintendo will be in a very, very similar position. I don't think that Nintendo will even think about filing a lawsuit like this without being as sure as they can that they're going to win this.

If you are unaware, this was done because of the launch of Dragalia Lost, a game that has long been forgotten, and discontinued.