"NEW: Nintendo is suing the creators of popular Switch emulator Yuzu, saying their tech illegally circumvents Nintendo's software encryption and facilitates piracy.
Seeks damages for alleged violations and a shutdown of the emulator.
Notes 1 million copies of Tears of the Kingdom downloaded prior to game's release; says Yuzu's Patreon support doubled during that time. Basically arguing that that is proof that Yuzu's business model helps piracy flourish."
That's rather clear evidence that they dumped their own ROM and distributed that. Since they own the rights to that ROM, they're not distributing it illegally though. They can dump and distribute their ROMs all they want; they own the rights to them.