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midrange said:
Nintendo should not be praised for subdoing creativity. It's petty for a giant company to take down FREE passion products made to please the community. Project m is a big example that comes to mind. People love super smash bros melee but there's no doubt that melee loses its lust as time goes on (due to graphics, new characters, new stages, new innovations, etc.). So how does Nintendo repay its devoted fans that want to keep the legacy of melee going? They shut them down. It simply baffles my mind that Nintendo would want to kill off passion products like those. Their actions are legal, but that doesn't mean they aren't being disrespectful and idiotic in the process.

Compare their actions to a company like valve, where passion products like Warcraft mods are transformed into big hits like DOTA 2 and you see that Nintendo is just throwing away potential

The problem with Project M is that they basically used Brawl and modded assets including possibly hidden assets that hinted cuts and such (Mewtwo and Roy). The reason they didn't shut them down personally was probably due to the game keeping the third party characters in which that can be stingy. The dev team was pretty much shut down due to fear. You can talk about reading between the lines and such but that's what I read and we can't really say much unless the dev team say anything else otherwise since they confirmed Nintendo didn't approach them to shut down the project. 

It also didn't help that Smash 4 was looming and then later being included in tournaments. Now that Smash 4 is developing a growing scene with one of, if not the, greatest crossover rosters of all time, new players and Brawl veterans are shifting focus on Smash 4. Project M is still around and can still be downloaded through other means, it just can't be mentioned on Miiverse, live at tournament streams, or be on Twitch. Again, this is all gray line to me and you can't just simply say Nintendo hates its fans and all that stuff that goes with it. Not everyone is bothered by it nor affected by it. Maybe Nintendo, HAL, etc. will release Melee HD or something someday. For now, Smash 4 and Melee (with some 64) are the big focus in tournaments currently.