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Apart from the matter of fact that the online community will completely crush pokemon as of now. And i doubt they want that. They tried to sue "someone" and we all guess its Palworld - and that already backfired more than anything else in the past 25 years.
They wont sue Palword because they know it would hurt the pokemon franchise more than anything else in history. We all know what kind of sh-storm can rain down from gamer once people get mad. Look at Starfield, Diablo 4 or whatever. They have been roasted by the community - and i feel like the roast for pokemon would be even bigger because many people just waiting for it to release the storm.
If anything they secretly would attempt to blackmail or acquire palworld in a subtle way.
If anything, the thing separating Palworld and Pokemon: Legends Arceus isn't the fact that you need to eat occasionally. It's that the Pals engage in real time combat, and Pokemon is still using turn based combat even in real time environments.
sadly, even if they made it, and somehow made it competently and not in the most lazy creatively bankrupt way ever . It wouldn't be available on anything outside of a console.
Also no studio can copyright a game genera, there are many survival games out there. This simply isnt how copyright works unless nintendo directly stole specific characters.