James Burt, 24, agreed to pay $1.5 million in damages plus $100,000 in court costs to the gaming giant behind the hugely popular Wii game.
He is the first Australian individual to be sued in the Federal Court for game piracy.
Burt, who works at a Brisbane freight forwarding company, obtained a copy of Super Mario Bros Wii and made it available for download on November 6, a week before the title's official release, through a website since closed down "out of respect for Nintendo".
Nintendo Australia managing director Rose Lappin said the illegal copy was downloaded by more than 50,000 people around the world, causing untold losses.
She said the piracy was "devastating" particularly as the game was to be released in Australia before the rest of the world.
"It was something we had to take action against as the game was massive and years of development were involved," Ms Lappin said.
"It was a disaster because we'd requested the game early and got it first in the world. When it was downloaded we were all devastated about that and the implications globally."
The Super Mario franchise is one of Nintendo's most popular stable of games.
Super Mario Bros Wii went on to sell more than 10 million copies worldwide in the first two months of its release.
Nintendo Australia became aware of the breach after Burt went online and bragged he had copied the game and made it available for others to easily download. "We just followed that lead," Ms Lappin said.
Ms Lappin said Burt had obtained an early copy of the game through a retailer who had mistakenly put the title on display before its official release.
According to Burt's MySpace page he was once employed by EB Games, Australia's largest computer game retailer. EB Games declined to comment yesterday
The Daily Telegraph contacted Burt. "I am not at liberty to discuss anything to do with the ruling. No further comments." he said in a message via Facebook.
Yesterday's settlement came a week after internet service provider iiNet's victory in the Federal Court over the movie industry's attempt to make it liable for pirated film downloads by its customers.
Nintendo's Ms Lappin said information seized from Burt could lead to further suits against game pirates.
She said piracy was a serious issue in the Australian computer game industry. An Allen Consulting Group study estimated it cost retailers $12.8 million a year and game suppliers $4.3 million.
"Piracy is massive and getting bigger and bigger but I think the courts are taking it more seriously now as you can see by this," Ms Lappin said.
"As an industry it's a major problem and the cost is massive to the industry and to developers.
"Some of these guys say there are more downloads than there are actual sales for them. That's shocking for our industry."
Editorial
Computer games aren't all cartoons and giggles. For their creators and manufacturers, they represent a massive global industry. That is why copyright violations and incidents of piracy are pursued so aggressively.
The makers of these games are perfectly correct to do so. The fact that copyright violation is relatively easy in this era of the internet has little to do with it; it is also relatively easy to rob an unoccupied house, but that doesn't mean it's right in any way right.
In the case of James Burt, the Brisbane man now facing a $1.6m penalty for putting a stolen copy of Nintendo's Super Mario Bros Wii online, some may also see mitigating circumstances in the fact that Burt did not seek profit from his actions.
Again, This is beside the point. It doesn't make any difference to someone who's car has been stolen if the car was subsequently sold, just as it makes no difference to Nintendo if their stolen product was given away or offered for purchase.
Theft is theft. This can be a very expensive lesson to learn.
The Editoral isn't on the website, I copied it out from the actual newspaper because i thought it made a good point.
PSN- williwod
Remember, there are no stupid questions. Just stupid people- Mr Garrison
