Not only that, but the Pokémon example doesn't work.
Pokémon is 2/3 owned by Nintendo. Or did you forget that Pokémon is Nintendo/Game Freak/Creatues Inc.? Creatures Inc. is a subsidiary of Nintendo.
That is my point. Game Freak ISN'T a subsidiary of Nintendo. It's legal status is 'private developer.' It has no direct tie to Nintendo. It is just published exclusively through them.Game Freak made Pokemon(long before Creatures was in the picture), but since they were contracted by Nintendo to make it, the IP belongs to Nintendo which is why they freely use it. Which is how a second party works.
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Game Freak, Inc. (Japanese:
株式会社ゲームフリーク Kabushiki gaisha Game Freak) is a Japanese game development company founded on April 26, 1989 by
Satoshi Tajiri,
Ken Sugimori, and
Junichi Masuda, and the main company responsible for the
Pokémon games, most especially the
main series versions.
Originally independent, since the release of
Pokémon Red and Green in 1996, Game Freak has been a
second-party developer for
Nintendo, developing games exclusively for their hardware
while remaining a separate company. The company currently employs a staff of 71 as of April 2011
[1], while Satoshi Tajiri serves as its current CEO. Its headquarters are on the 22nd floor of the
Carrot Tower in
Setagaya, Tokyo,
Japan.
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Creatures, formerly Ape, is the company behind spinoffs of Pokemon, but more importantly in this instance they own Ness. That is why they are listed as copyright for the smash series. They are the subsidiary of Nintendo, which makes them a first party. Meaning they ARE Nintendo, as opposed to a separate entity working FOR Nintendo.
To round out the differentiation, we have third parties. Which are IPs that are both Developed AND Published by people who aren't Nintendo. And then released for Nintendo systems. Like Megaman. Who was developed by Capcom, and published by Capcom. No direct Nintendo involvement.
So regardless of legal loopholes(which are always a pain, breaking the rules and such). Geno is considered a "second party character" by Nintendo. Not a third party. Even if he were to technically be owned by Square. As I said originally. That minor hitch wouldn't stop Nintendo from considering him as they would any other second party. If it did, we'd have never seen him make a cameo in SSG.