If you know anything about Nintendo’s business practices, you likely are well aware of how litigious the company is. This has been going on for decades, as Nintendo is highly protective of its intellectual properties and its image. The company regularly sues anyone it considers tarnishing its name, which is why the Palworld lawsuit has been in the news of late. If you look back through the company’s history, there are many lawsuits to pore over. Still, one in particular is arguably the most fascinating and important to the wider video game industry: Lewis Galoob Toys, Inc. v. Nintendo of America, Inc.
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While the lawsuit’s name doesn’t mean much to anyone outside of the parties involved, what it was concerned with was of great importance to a ton of gamers in the 1990s, as it targeted Lewis Galoob Toys, Inc. over the Game Genie. If you’re unfamiliar, the Game Genie was a device originally released in 1990 that fit into the Nintendo Entertainment System’s game cartridge slot. You could then place an NES cartridge into the Game Genie, and its programming would take over, allowing the player to input a multitude of codes that altered the game in various ways, enabling all kinds of cheating mechanics and improvements. Nintendo didn’t like that.
Nintendo’s Fight Over the Game Genie Was Expensive
The history of the Game Genie is interesting, as it was developed by reverse-engineering the NES’ hardware to make it function as desired. When it was time to release it in the United States, Galoob, its U.S. distributor, preemptively sued Nintendo to prevent a block on future sales. This was done because Nintendo’s litigious nature was well-known, and the iffy manner in which the Game Genie came into being was likely to trigger a legal response from the video game juggernaut, which was on the cusp of releasing the Super Nintendo, and didn’t want to see its name tarnished in any way.
In this case, Nintendo was on the receiving end of litigation, but it didn’t remain that way for long. The company employed an army of attorneys raring to file motions and seek justice for Nintendo in any way they could. Nintendo quickly filed a lawsuit seeking an injunction against Galoob. This was granted, and sales of the Game Genie in the States came to a grinding halt. The injunction was temporary, and the case eventually went to trial. When it did, both companies fought one another over the new device, and they each had a claim as to why it should or shouldn’t be allowed onto the market.
While Galoob appealed the injunction, it was not granted, and the trial commenced. With the injunction in place, the arguments flew, and the judge required Nintendo to issue a $15 million bond to ensure that potential lost sales of the Game Genie were awarded to Galoob should Nintendo lose the trial. Ultimately, the judge found that Galoob hadn’t violated Nintendo’s copyrights in any way, and Nintendo begrudgingly conceded the point. Because the decision was made in Galoob’s favor, the $15 million bond ($35.5 million in 2026) went to Galoob alongside about $1 million ($2.4 million in 2026) in legal fees.
Nintendo Lost the Lawsuit and $16 Million Bucks
Once the legal issues came to a close in Galoob’s favor, the gloves were off in terms of what could be done with the Game Genie. The company expanded significantly, first with a version for the Super Nintendo, and then with the Nintendo Game Boy, the Sega Genesis, and the Sega Game Gear. Most games worked with the Game Genie, though they didn’t all. Regardless, the company pulled off a David-and-Goliath bout against the biggest name in video games, emerging on top with a hefty legal settlement and the freedom to continue developing as it saw fit.
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