Emulators have largely been regarded as more or less legal, although the acquisition of ROMs and BIOS files needed to operate them may not always be. It's generally been accepted that individuals can legally dump their own games and BIOS files for archival purposes, and emulators distributed are typically provided "as-is," meaning they do not function unless these specific files are supplied by the user. Emulators also offer quality of life improvements, including upscaling, better performance, and mods.

However, Nintendo's recent legal actions against Tropic Haze LLC, the company behind the Nintendo Switch emulator "Yuzu," cast doubt on the current legal standing of emulation. Developers have begun to abandon their projects, leading to the discontinuation of emulators for systems as old as the Game Boy. Notably, Exophase, the developer of the Drastic DS Emulator, has made the app free on the Google Play Store and pledged to release its source code.

Emulation has never been in a worse state than this, and it's hard to see how things can get better.

Emulators are technically in a legal gray area

We can thank Bleem! and Connectix for that much

In 1999, the company behind Bleem (appropriately dubbed "Bleem! Company") had created and commercially sold an emulator that could play PlayStation games on a PC or a Sega Dreamcast. Sony accused Bleem of copyright violation over the use of the PlayStation BIOS on a personal computer, alleging that it would damage sales of PlayStations. The judge ordered a protective order in favor of Bleem to "protect David from Goliath." Despite this, legal fees and patent fees eventually forced Bleem out of business.

Sony also attempted to take down Connectix for its Virtual Game Station emulator. This emulator, like Bleem, could play PlayStation games and was originally built for Macintosh, though was also later ported to Microsoft Windows as a competitor to Bleem. Sony filed a lawsuit against Connectix, being granted a temporary injunction that prevented sales of the emulator. However, the case was closed with a ruling in favor of Connectix, and Sony then bought Virtual Game Station from Connectix and immediately shut it down.

With both of those emulators essentially setting a precedent for emulation being legal, it's since been conventionally understood that emulation is legal.

Things get murky with modern gaming systems

Preservation is hard to argue for an active console

There are a few elements of the Nintendo lawsuit against Yuzu that differ from those lawsuits of old, and why many were curious how a judge would rule if it had gone to court. Emulation fans love to argue that emulation is important for game archival purposes, especially in the wake of online storefronts for the likes of the Nintendo Wii and the Nintendo 3DS shutting down forever. It's hard to argue that emulation is for preservation purposes when a console like the Nintendo Switch, an actively supported console, is the one being emulated.

On top of that, Nintendo's issue raised in the lawsuit was not so much emulation itself, but rather the dumping of decryption keys from a console. Those keys, Nintendo alleges, are not possibly obtained through legal means, but those keys are what enables the emulation of those games in the first place. Like with games, however, those keys can be distributed online and shared through illegal means, so that people without a console can still play those games.

With all of that said, it's pretty clear that Nintendo feels that emulation of the Nintendo Switch is essentially impossible through legal means. While Nintendo's accusations don't really apply to older consoles, you can't necessarily blame emulator developers from not wanting to find out if what they're doing will have Nintendo come down on them in the future.

Interestingly, Dolphin Emulator, which has been actively developed for years, actually includes a copy of the Nintendo Wii's common key in its source code. The team behind Dolphin does not believe this to be a problem following legal advice, stating in a blog post at the time:

We're disappointed that so many people on YouTube and social media didn't even consider that maybe the team had done their research and risk analysis before including the keys, and just assumed that now that it was "pointed out to us" we would remove them. However, we do not think that including the Wii Common Key actually matters - the law could easily be interpreted to say that circumventing a Wii disc's encryption by any means is a violation. As such, it is our interpetation that removing the Wii keys would not change whether the exemption in 17 U.S.C. § 1201(f) applies to us or not.

With Yuzu's shutdown, that stance has not change. Defiant in the face of Nintendo, the Dolphin Emulator team issued the following statement on the tenth of March, just days after Yuzu was taken down:

We have no plans to discontinue Dolphin at this time.

We reached out to Dolphin for further comment and did not receive a response at the time of writing.

Developers for the Dolphin Emulator project have also stated that asking users to dump their own Nintendo Wii common key or distributing it in the source code is the same legally, according to the legal advice they have received. Given that Nintendo requested that Valve do not allow Dolphin Emulator to come to Steam, but then made no further moves after, it seems to suggest that Nintendo is happy to leave Dolphin Emulator alone... at least for the moment.

Looking to the future

It's hard to say if there will be more collateral damage

Following the settlement, both Tropic Haze LLC and Nintendo of America have asked a judge to rule on the following:

Developing or distributing software, including Yuzu, that in its ordinary course functions only when cryptographic keys are integrated without authorization, violates the Digital Millennium Copyright Act’s prohibition on trafficking in devices that circumvent effective technological measures, because the software is primarily designed for the purpose of circumventing technological measures.

To be clear, a settlement does not set precedent, but asking a judge specifically to rule on a case such as this may still create legal boundaries that emulator developers won't want to touch. In the future, it could be used as an argument that Tropic Haze LLC asked for this ruling to be the case. It won't necessarily be legally binding, but it's yet another push in the direction of preventing emulators from being legal.

With more emulators beginning to shut down (such as Pizza Emulators) and Drastic soon set to pull the plug, developers are clearly scared of reprucussions from Nintendo. While Nintendo may not be legally right (and nobody can really say if they are until a lawsuit actually goes to trial), whoever takes on that case should prepare to go the way of Connectix or Bleem; even if they win, the cost of fighting it can be ridiculously high.