We were doing this in college today and I thought of this thread.
Here are some quotes from what we were talking about on copyright.
"If you write a story using settings or characters from somebody else's work, you need that author's permission.
Yes, that means almost all "fan fiction" is arguably a copyright violation. If you want to publish a story about Jim Kirk and Mr. Spock, you need Paramount's permission, plain and simple. Now, as it turns out, many, but not all holders of popular copyrights turn a blind eye to "fan fiction" or even subtly encourage it because it helps them. Make no mistake, however, that it is entirely up to them whether to do that."
"However, it's also worth noting that a court has never ruled on this issue, because fan fiction cases always get settled quickly when the defendant is a fan of limited means sued by a powerful publishing company. Some argue that completely non-commercial fan fiction might be declared a fair use if courts get to decide."
This pretty much applies to us as fan game developers.
