They were making $30k a month from their patreon. That's enough money to afford a lawyer, and plenty of incentive to defend themselves in court if they genuine believed they weren't doing anything illegal.
Their patreon had custom builds of the emulator specifically tailored to run leaked games before release. In their own patreon, yuzu's developers admitted to having copies of nintendo's games at a time they could not be legally purchased. They also admitted to profiting from those illegally obtained ROMs for an amount that patreon shares publicly. That is the sort of slam-dunk evidence that would make nintendo's lawyers salivate.
This isn't an unclear situation. Yuzu was legally in the wrong. If this went to trial they would almost assuredly lose even more. If yuzu was doing more piracy there's no way to hide it during discovery.