There's ample legal precedent in America that emulators are legal so long as it's made in a clean room dev environment and does not contain tools to decrypt or break copy protection, which Yuzu requires you to obtain on your own.
Nintendo knows that if this went to court there's a good chance it'd get thrown out just from that precedent, and instead is trying to make the scariest legal threats they can to settle out of court. Which is exactly what happened.
Nintendo's goal is to make it appear as though emulation IS illegal by threatening every single developer they can until they bend to their will, even if they've done nothing wrong.
Once again, I must reiterate, Yuzu has no means of circumventing copy protection on its own. it is only capable of this if the user provides decryption keys and a firmware, and that's almost certainly only illegal if you didn't dump them yourself. I may not be a lawyer, but the legal precedent on file suggests this conclusion strongly enough that I'm confident Nintendo is just waving their dick around and trying to scare everyone into silence for even discussing emulation.
Fuck Nintendo and keep pirating their games.
