As we already know, the Dreamcast already had a motion controller in 1999 with the Fishing controller, which unlike this idea was actually put out on the market but it's technology was never really emphasized on, with the exception of some hidden compatibility with Virtua Tennis and Soul Calibur. In late 2000 Sega also developed the Samba De Amigo maracas, which used a unique height detection sensor bar, kind of (but not exactly like) the senor bar the Wii used to detect where the remote is pointing at the screen.
He probably doesn't have much of a case, as his device seen here is not a first, if mightily similar. Nintendo have stated that they have never heard of this guy or this old concept. My guess is we have had multiple studios all working on similar concept at the same time, much like the whole analogue stick fiasco of the mid 90's when Nintendo, Sega and Sony all came out with analogue concepts at roughly the same time.,
But hang on! Wasn't a new Ready 2 Rumble game announced for the Wii a few months ago? It's not being developed by Midway, but there's a good chance it'll play a lot like this controller does for the Dreamcast game. Maybe hearing of a Wii R2R has convinced Goschy to finally speak up about his idea. Also, just about all of the games that are now known to have motion controls have had installments on the Wii: Samba De Amigo is being bought over to the Wii by Gearbox, Soul Calibur Legends turned out to be a bit shite and nothing like SC1 with with the fisher, and Sega also have a Sega Bass Fishing for the Wii in the works, as well as Sega Supestar Tennis, running on the Virtua Tennis engine! How bizarre!
This is further evidence that the Dreamcast sure had a lot of interesting development happening behind the scenes which has ended up becoming finally implemented in modern systems. Remember, Sega also had their own equivalent of the Virtual Console in the works, but of course we all know Sega simply didn't have the money or power anymore to carry on taking such risks. It's amazing to think what the Dreamcast could have been had things been different.
UPDATE! The Fox news report about this guy suing Nintendo is now online for all to see! Make of it what you will!