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I know a guy thats planning on making doghouses for medium size dogs and sell them on craigslist...well anyways.....his thinking of doing some art work on the side of the doghouse, like some flappy birds or super mario or zelda or some random legit looking artwork.....nothing would happen if perhaps he somehow makes a profit out of it or makes some money from it? His scared that some copyright agent or something might file a law sue for 1 milion dollars or something like that lol just asking.
The deal with that kind of thing is it needs to not be exact. It can look a heck of a lot like *insert character name* but it can't be an exact rendition. Disney is really crazy about this kind of thing for instance, they will issue cease and desist against day cares with Mickey on the side of the building. Copyright law is written sch that if you don't protect your copy right then you more or less lose it.
It's unlikely your friend would be sue but if he became remotely successful he'd likely be told to stop using copyrighted images.
Ermmmm if he's selling that shit locally it's not going to be a huge deal lol.
use images from the public domain, simple
Nothing you would be doing would technically be copyright.