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Nintendo is suing the creators of Switch emulator Yuzu
(news.bloomberglaw.com)
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You cannot state that with certainty. That's the problem.
Yuzu does indeed include a method to use the Switch's production keys (which you must dump yourself) to decrypt the games. Whether this constitutes effective DRM is not a question that can easily be answered and must be decided by a court on a case-by-case basis.
This will be what the case will hinge on: Is Ninty's scheme effective DRM?
I would say no because symmetric encryption with a publicly known key may aswell be no encryption at all but that's not my decision to make.
Um, no. The emulator is doing the decryption on its own. All the user does is provide the prod keys and unmodified ROM.
Yuzu itself doesn't provide tools to dump keys and Roms from the Switch. The user has to procure them, or the means to dump them, themselves. Thus Yuzu doesn't facilitates DRM circumvention. The user has to solve that part on their own. They do provide guides for how to do it on their website. But Yuzu themselves don't make or distribute the tooling, and Yuzu the software is incapable of doing it.
The dumps are just that: Dumps; 1:1 copies.
The tools don't decrypt anything; that happens within Yuzu. Why else would users need to provide the prod keys to Yuzu?
To dump the keys, third party tools rely on DRM circumventing sploits. You essentially have to hack your own device, certain versions of Switch and certain software updates are no longer susceptible. But it remains that Yuzu doesn't do any of that. Those tools and sploits were developed by others.