A lot of the posts here don't appear to have a well thought out stance on copyright laws and simply use liking game developers and hating Internet memes as a primary argument, so it's hard to build a reasoned discussion around these kinds of comments. It would help if posters consider at least some of these questions.
For the people dismissive of this lawsuit, do you believe that characters created by others should be freely used in a commercial work? Do you believe that characters popularized through Internet memes deserve no copyright protection when used in commercial works? Do you believe memification implies parody and thus fair use?
Nyan Cat and Keyboard Cat appear to be the only objects in the Scribblenauts games that are potentially under copyright contention. Outside of some licensed Nintendo characters and the cats, 5th Cell have been careful keep other characters out of the games. Suppose the below characters were added to the games with the ability to type their names (eg. "Blanka", "Locke", "Travis Touchdown") to summon them. Should 5th Cell have as much a right to use these characters as they do Nyan Cat and Keyboard Cat? If not, what determines the threshold for fair use? Do the characters have to have been used in a strong narrative work, as opposed to a brief video? Does Nyan Cat being copyrighted as
Visual Material and Keyboard cat being copyrighted as a
Motion Picture make a difference in how they can be used by others? Do the trademarking of
Keyboard Cat and
Nyan Cat make a difference, and should they have been given trademark status?