Which is great news... for Nintendo.
The problem that Nintendo is citing in their lawsuit is the fact that Yuzu ships Switch common keys. For the purpose of DMCA 1201, this is a smoking gun[0]. There isn't really a good legal argument for why emulators should be allowed to ship decryption keys, or at least, the EFF refused to come up with one when Dolphin asked for legal advice on this point a while ago. So if you go to court and provide a completely legally baseless argument, Nintendo wins, and then they move for fee shifting, which means they get to prosecute the case for free[1].
[0] While it is true that the scope of DMCA 1201 is far wider than just encryption keys, in this case, Nintendo has only cited the keys being in the emulator and the fact that Yuzu is really useful for running pirated software, which is "good enough".
[1] In practice, it's more "for cheap" than "for free", because there's specific rules about how much you're allowed to fee shift, a whole bunch of stuff about 'lodestar amounts', etc.
That being said, I don't think two layers of indirection help Yuzu. It's one thing to say "this requires decryption keys and you have to rip your own games", and another to say "and here's where and how you get those things".
Put it this way: You know how emulator developers are very strict about not providing ROMs for obvious reasons? The decryption keys work the same way. If Yuzu had, say, linked to a ROM site and said "here's where you can get games for our emulator, wink wink nudge nudge", that'd be an open-and-shut case[0].
[0] https://en.wikipedia.org/wiki/MGM_Studios,_Inc._v._Grokster,....
DMCA 1201 comes in two parts: a law that prohibits breaking DRM, and a law that prohibits telling people how to break DRM. If someone just had a Switch and somehow managed to figure out how to get the keys and games out of it, then ran them on an emulator, it'd probably be legal[0]. This is because the part of 1201 that makes it illegal to break DRM has shittons of escape valves that are designed to ensure that previously legal behavior doesn't suddenly become illegal just because you put a digital lock on it.
However, the part that prohibits trafficking in circumvention devices lacks any of these escape valves. I believe this to be by design. Congress wasn't willing to, say, reverse the Sony Betamax decision[1] and criminalize home video recording, but they were willing to allow Hollywood to slowly shut it down. A escape valve for circumvention would render the whole law ineffective: so long as someone has a legal right to break the DRM, you can sell it to anyone, not just people who can demonstrate they need it.
The legal standard for what constitutes a circumvention device is very broad. Specifically, something is a circumvention device if either:
- It's only function is to break DRM, or
- It's only commercially significant function is to break DRM (read: courts, ignore Betamax), or
- It's advertised to break DRM
That last one is the tricky bit. Let's say I took an ordinary HDMI-to-composite video adapter and put a sticker on it that said "Copy Netflix Originals Quick And Easy"[2]. Streaming boxes and Blu-Ray players support unencrypted output at legacy resolutions, so the video adapter breaks no DRM, it's just a DAC. But because I've advertised it as a way to strip DRM, I've broken the law by selling it.
So let's go back to our key dumping tool. Even if it's literally just a shell script for whatever the Switch equivalent of GodMode9 is, because it's being advertised as a way to copy games, it's just as illegal as putting the production Switch keys directly into Yuzu's source code. As an emulator developer, the only way to avoid liability under DMCA 1201 is to provide zero assistance to people who want to rip their games.
[0] This isn't court-tested, and probably never will, but prior attempts to argue against format-shifting in US courts haven't fared well.
[1] SCOTUS would do that later on with MGM v. Grokster. Remember: the reason why Sony was in hot water was specifically because they advertised Betamax as being good for pirating movies, not just that you could do so.
[2] In the world where Congress did include safety valves for 1201(a)(2), this sticker would probably say "Make Fair Use Commentaries On Netflix Originals Quick And Easy".
You would have to somehow set a limit of legal expenses, which seems... difficult.
You would have to win to get the common fund, you may not get that far if you have to pay into the fund and amount a defense.
The litigants and defendants would not be compelled to contribute equal amounts. Just the disbursement would be equal.
If nothing compels them to, they won't, so effectively the status quo.
And Yuzu spends $25,000 and maybe wins the first case but runs out of money during the appeal and defaults judgment.
Nintendo gets the pot because they won right?
As I pointed out to another user, this reverses the damage if they win, but does not solve the problem of preventing them from being able to win.
Now if you make it where if you want to spend $5 on lawyer fees, you have to loan $5 to the other side and if the other side wins they don't have to pay it back, that may work.
That's essentially what I was suggesting with having to loan the opposing team the same amount of money you spend.
But all of that money goes into a prize pot, which gets distributed based on who wins the case.
This would ensure either Nintendo doesn't try to financially grind out a poor small company because the loss would not be worth it to them.
The problem is not the end payout, it's the base cost can't be afforded along the way.
One side can keep appealing and escalating, the other can't pay for the cases themselves.
They may not get far enough to win the pool.
You would have to have the lawyers work pro bono or some common legal fund pay for it until the case is won to get the pool.
As I pitched to another user, how about:
> for lawsuits, if you want to spend $5 on lawyer fees, you have to loan $5 to the other side.
> if the other side wins they don't have to pay back the loan.
They could open source and distribute the code in a decentralized manner. People could download, use and work on the software freely. The Pirate Bay is still going, based on these principles.
But if you're going to run a commercial enterprise based on what can at least be construed as enabling piracy, you're playing with fire and companies have the right to protect their IP in court.
It can be used to win cases against other emulators and even shut them down with limited legal action.
If Nintendo loses, the next defendant would have even more precedence.
If Nintendo wins, it's easier to go after future emulator projects.
They're already making $30k/month on patreon and you can easily foresee that this legal action will cause a call to arms for even greater funding, if that was indeed their goal they could have targeted the much smaller ryujinx and set a precedent.