"Herlock Sholmes" is NOT Incorrect, Though He is Often Wrong!

[Alayern]

Hey folks, some posters have already indicated this, but "Herlock Sholmes" is not a localization issue or a typo. Maurice Leblanc (author of The Arsene Lupin, Gentleman Thief) wanted to use Sherlock Holmes in his work, but Sir Arthur Conan Doyle said "OBJECTION!" Maurice did use him anyway until Doyle threatened him with legal action. That's when Leblanc switched to Herlock Sholmes, to subvert Doyle's claim to the–otherwise identical–character.

Herlock Sholmes has been used as a stand-in for Sherlock ever since, more often as a comedic reference or parody than deliberate subversion of intellectual property (which, incidentally, did not exist legally until 1988 in the US, a grand 58 years after Doyle's death, and thus earlier entries in the Sherlock Holmes franchise are Public Domain.)

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Tangentially Related: If you're thinking Arsene and Leblanc are familiar from Persona 5, you're right! That was quite deliberate. Each of the core party's personas are direct mythological/literary references, including the confusingly named Milady.

[Zagryzaec]

Thats not the problem.
The fact that originally he is Sherlock Holmes and in translation he is not is the problem. Same with watson. At least they should have left dialog texts in the open to let us fix the issue.

[Karyon]

Technically it is localisation issue, since in the Japanese version all likenesses from the Sherlock Holmes stories are used without trouble. Though, the localisation team is clever to use Herlock Sholmes given the historical provenance it has.

[Zagryzaec]

I wish those copirights stop messing up with people creations, and japanese authors stoped using copirighted material in the first place only to creat some m.bison/herlocks later.

[Alayern]

They have to obey international copyright law. Sherlock Holmes' later stories are still under copyright in the US thanks to the Arthur C. Doyle Estate, so Capcom could not include the name in the US version of the game. It's not a matter of localization, it's a matter of avoiding getting sued by Doyle's Estate. The Estate is notoriously trigger happy, and have sued the studios behind Mr. Holmes starring Sir Ian McKellan, and the more recent Enola Holmes wherein Sherlock is a supporting character played by Henry Cavil

The Estate's claim only applies to the last ten or so stories Holmes starred in, where he became a more empathetic character. The version of him as presented in the BBC Sherlock show is public domain–only so long as he is an unfeeling logic machine–but the Estate still holds copyright on the version of Sherlock that's not a jerk. GAA needed a more human investigator, so they couldn't use Holmes, and had to use Sholmes.