This is what people are debating here. The name of the game os "Elder Scrolls." Should they be able to block anyone from having a game with either of those two words in the title? It would be like someone making a franchise "The Dark Knight" video game getting sued by the makers of "Alone in the Dark" because the titles share the word "Dark." This is not to mention the fact that no one refers to any of the Elder Scrolls games by the name 'Elder Scrolls.' People call them by the release/episode names (e.g. Elder Scrolls III: Morrowind is just referred to as "Morrowind" far more frequently than "Elder Scrolls III").
[edit] Better example: Sid Meier suing Disney over a Pirates of the Caribbean video game infringing on his Pirates![1] game.
Actually that's the name of the game series and the sub-title of the games (and technically it's "The Elder Scrolls), the games are called Arena, Daggerfall, Morrowind, Oblivion and Skyrim. Or "The Elder Scrolls [game sequence number]: [actual game title]" if you want it in full. With [actual game title] replaced by expansion names for each installment's expansions.
I'd have thought the opposite would be a more accurate comparison: Disney claiming "Pirates!" as similar to/confusable with "Pirates of the Caribbean" (discounting any issues of who actually owns what trademarks in reality just now).
No mention of the issue is complete without a reference to Tim Langdell, and his hilarious suits against anyone using the word 'Edge' in their games[1].
[edit] Better example: Sid Meier suing Disney over a Pirates of the Caribbean video game infringing on his Pirates![1] game.
[1] http://en.wikipedia.org/wiki/Sid_Meier%27s_Pirates!