Following the Steam Early Access release of Palworld on January 18, 2024, the developers faced accusations of copying Pokémon models for the designs of the game's Pals. The allegations were made by a Twitter user named byofrog, who claimed that some of Palworld's creature models were directly copied and edited from 3D models ripped from Pokémon games. These allegations were criticized for scaling the Pokémon and Palworld models to be comparable in size, leading to claims that edited models were not reliable or accurate evidence. byofrog claimed in response that because the models from each game loaded into modeling software at different sizes, scaling them appropriately were the only necessary edits made to compare them, and that the models' meshes, proportions, and other fundamental features were not edited. Takuro Mizobe, the CEO of Palworld developer PocketPair, denied the allegations, calling them "slanderous", and also stated that PocketPair has "no intention of infringing upon the intellectual property of other companies".

On January 25, The Pokémon Company released an official statement confirming they were aware of a flood of inquiries about "another company’s game released in January 2024". On September 18, Nintendo and The Pokémon Company filed a lawsuit against PocketPair, but instead of accusing them of copyright infringement as critics were, they accused them of infringing multiple patent rights and sought compensation for damages. PocketPair responded claiming they were unaware of any patents they violated and that they were not notified of which patents they were accused of infringing.