Nintendo's Palworld patent suit stretches into a second year
Nintendo's patent infringement lawsuit against Pocketpair, the developer of Palworld, has stretched into its second year without a final verdict, with the dispute centering on creature-catching and gliding mechanics that critics said resembled those in Pokémon. Nintendo filed the suit after Palworld's 2024 early-access launch attracted millions of players and earned the title the "Pokémon with guns" label, seeking both an injunction limiting Palworld's distribution and financial damages. Because Nintendo holds more than 3,000 active patents, the specific patents at issue were not publicly detailed, though analysts noted that Nintendo chose patent rather than copyright claims in part because Palworld appeared visually distinct enough to potentially defeat a copyright action.
Palworld gameplay changes narrow the scope of the patent claims
Pocketpair already altered how Pals are summoned shortly after the initial filing and revised the gliding system in 2025, requiring players to use a separate glider rather than riding creatures. Nintendo responded by amending its claims in 2025 to target older versions of Palworld that still used the patented mechanics, which should limit the impact of any adverse ruling on the current version of the game. Nintendo had originally sought an injunction that would have completely limited Palworld's distribution, but the amended claims and the modified gameplay make a sweeping remedy less likely.
Japanese patent office rejects a related Nintendo application
A potentially significant development is the Japanese Patent Office's rejection of a related Nintendo patent application after a 2013 fan-made Pokémon project was cited as prior art. Nintendo argued that the fan project should not count as prior art, but the examiner rejected that position. Nintendo has requested further review, meaning the rejection is not yet final and court proceedings in the underlying case continue as both sides gather evidence.
Switch 2 production trimmed as US demand cools
According to Bloomberg reporting from March 24, 2026, Nintendo is producing fewer Switch 2 units than originally planned for the current quarter, with output reduced from six million to four million in response to weaker demand in the United States, and the lower production pace expected to continue into April. The slowdown follows a record-breaking launch in June 2025 that made the Switch 2 Nintendo's fastest-selling console of all time after selling 3.5 million units in its first four days. The cuts are not expected to affect the company's target of selling 19 million Switch 2 units in the fiscal year ending in March, and Nintendo remains confident in the console's long-term prospects.
Cost pressures and pricing considerations for Switch 2
Nintendo is also weighing higher production costs driven by rising memory prices, with Bloomberg reporting that the company is considering whether to raise Switch 2 console prices, though the production cuts themselves are being driven by softer US consumer demand rather than cost factors. Export delays linked to conflict in the Middle East could prompt Nintendo to increase Switch 2 output again, and the company is aiming to stockpile a battery-replaceable Switch 2 variant intended for European sales in the next fiscal year.
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