I'm not sure there was actually any "fiasco" though. It's one of the dumber chapters in Street Fighter history, really:
They created a Mike Tyson lookalike, and named him Mike Bison. This was the 2nd time they'd done this, actually. They never actually got hit with a lawsuit, or so far as I can tell, were even threatened with one. They swapped the names on their own in America as a "preventative" measure even though legally, the name swapping wouldn't have prevented anything, as the character's name was still M. Bison in Japan. It's not as if the infringement they were hoping to avoid would have actually been avoided with that move, especially once that move made it clearly obvious what they were doing, so obvious that everyone with more than a passing interest in the game knows this story.
And all of that wouldn't have mattered anyway because they probably could have claimed parody usage and been okay.
Basically: Their legal defense was always bullshit, and was implemented pre-emptively to fend off a suit that was likely never even coming in the first place.