Well the loophole is not really a loophole more like an escape hatch in that NFLT was shown to not be applicable for certain types of coevolutionary algorithms like say pareto coevolution. The way I understand it is that in essence the no free lunch theorem only applies when candidate solutions are not re-evaluated in terms of relative performance. In coevolution we continually pit a population of candidate solutions 'to play' against each other in order to evolve a champion. Since fitness in this case is relative and not absolute - making performance tricky to measure - NFTL can be wiggled out of. as long as you can evaluate/term your problem within game like heuristics.

- http://www.no-free-lunch.org/ - http://cs.calstatela.edu/wiki/images/1/15/Wolpert-Coevolutio...