this post was submitted on 25 Jan 2024
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IDK how US law is in this case but in Germany, all of this would evolve around the question if the game could be mistaken for a pokemon game die to those designs. It doesn't matter how similar stuff looks as long as it's not really plagiarism and obviously copied. So as long as they do not make it look like a pokemon game or use the pokeball or similar aesthetics, they wouldn't risk being sued or could harm Game Freak in return. They could challenge the registered trademarks etc. which could horrendously backfire, so large corporations usually avoid going after other large corporations and try to hash stuff like this out in backrooms. Lego for example is infamous for going after small shops that import Chinese brick makers but very decidedly not going after Hasbro, Lidl and Amazon, because those companies have the means to fight Lego's claims one by one which could lead to design rights being deleted by courts.
In this case it would probably be fought in Japan because both The Pokémon Company and Palworld's developer Pocketpair are from Japan.
And Japanese copyright law is one of the strictest in the world
Of course, but this is what makes me wonder, if there was anything truly objectionable happening, wouldn't they have been taken down already? It's not like this was a surprise release.