http://arstechnica.com/gaming/2016/12/nintendo-sends-cease-and-desist-notice-to-pokemon-rom-hacker/
A fan-made Pokémon ROM hack in the works for eight years was set to launch this Sunday. But a letter sent by Nintendo's Australian law firm on Wednesday has stopped those plans in their tracks.
According to Adam "Koolboyman" Vierra, developer of the fan-made Pokémon Prism project, Nintendo's Australian law firm sent him a cease-and-desist letter, which he uploaded to Google Drive with identifying information redacted. (American representatives for Nintendo were not able to confirm the letter's authenticity as of press time.) The request alleges that Koolboyman's project, which alters the source ROM of the 1999 game Pokémon Gold to create an entirely new adventure, violates multiple Australian laws.
[...] Pokémon Prism is different because it's a "ROM hack"—meaning, it's not a full game. Rather, Prism is a small patch file that is worthless without the original ROM file (which can either be legally dumped from a cartridge or maybe-not-so-legally downloaded from the Internet). Computer gaming fans would describe this kind of release as a "mod." Mods do a similar thing: they take existing, paid-for game engines and assets, and they apply a patch file that remixes existing content and adds new twists.
(Score: 1) by Francis on Monday December 26 2016, @06:58PM
Just determining if it's legal can cost hundreds of dollars. And even if it is a legal derivative work, you're still looking at the possibility of a trial if they don't back down.
But, in this case, they've likely violated Nintendo's trademark, which does require a response or Nintendo could lose it.