Say if i entered a comp with a shirt design and won and i used a character like sponge bob in the shirt design could legal action be taken against me? If i sold it?
Yes, although, if you didn’t try to sell the design, most likely no-one would bother to sue you (and they might lose, in that case, anyway, depending on exactly how you had used their character).
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Questions involving legal issues belong in our In My Humble Opinion forum. As the name implies, any responses you get there are just the opinions of some online folks and shouldn’t be taken as the equivalent of professional legal advice.
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I am not a lawyer, but it seems to me that this is a pretty straightforward trademark infringement. If you sold the T-shirt, not only could you be sued, but you might end up paying all of the court costs for the lawsuit as well as any punishment decided in the case.
Even putting the image on a T-shirt and entering it into a contest violates the trademark. Viacom, the company that owns Spongebob, probably isn’t even going to know about it. But if they find out somehow, they could take you to court over it. They might be friendly and send you a simple cease and desist letter first. But you could still end up in trouble.
Some companies are fairly lenient with respect to fan art, and there is a provision in the law for parodies, but your design is neither of those. You have to be careful with parodies, too. If you take it too far you can get sued for defamation of character.
If you just enter the shirt in a contest, and Viacom happens to find out about it, they might be a little lenient if you are fairly apologetic. Once you actually start selling the shirt though, I would expect them to be a lot less lenient. They may nail your backside to the wall as an example to discourage others from violating their trademark.
Again, I’m not a lawyer.
I’ve removed my entry from the contest, even if they don’t see it, can’t take a chance.
If this competition is at all legally formal with cash prizes, etc. there is probably a mention in the fine print rules that would disqualify an entry that was in copyright violation.
It would be a copyright or trademark violation, possibly both. This isn’t criminal; it’s civil, meaning they could sue you, but the police wouldn’t be arresting you and tossing you in jail.
As mentioned above, the owners of the IP probably wouldn’t bother pursuing it. It’s less a matter of whether you’re making money as whether it constitutes a threat to their IP rights or interests. (In the US, if you don’t police your IP rights, you can lose them.) So, it’s more a matter of popularity than money. Not that money is insignificant, but the lack of money isn’t a get-out-of-jail-free card. Even if they did pursue it, the normal first step would be to send a cease and desist letter, and if you comply, that’s the end of it. Cheap for them, protects their interests with minimal bad PR possibilities, and usually not a big problem for you.
However, you might try asking the company for permission, for limited purposes. Most likely you won’t even get a response, but one never knows. It also depends on the goal of the contest: if it’s to produce a design someone can use to make tshirts, then probably no luck. But if it’s simply a design contest, it could be OK.
If it’s for educational purposes (e.g., a design contest at a university art department), there’s a good argument that it could be considered “Fair Use” under the education caveat for copyrights. Trademarks is trickier; you’re allowed to use someone else’s trademark as long as you make it clear what’s going on.
The idea behind trademark law is to avoid confusing the public (customers). It’s OK for Coke to use a Pepsi trademark in their commercial, if they make it clear that they’re not selling Pepsi. What they can’t do is put stuff in a bottle with a Pepsi label and sell it. Things get trickier regarding stuff like NFL team logos: nobody thinks you’re an NFL player if you wear an NFL team jersey, but still trademark laws apply somehow, and I’d be interested in hearing more about that from an expert. Clearly, the NFL has exclusive rights to sell stuff with their logos. I understand that based on copyrights, but not whether trademark law applies. The same would apply to SpongeBob.
Don’t give up just yet: Round off his corners, give him a somewhat rougher surface, sharpen the buck teeth, put him in blue slacks, and you’ve got “Norman the Definitely-Not-A-Copyrighted-Image Vampire Loofah”!