Actually this says the trademark is pending them proving they are using it and they aren’t so they keep filing extensions. Also it’s limited in scope to word processing (at there is lots of back and forth with the trademark office about that)
The character is actually named Clippit. Although maybe MS trademarked Clippy after it became the more common name.
I seriously doubt Microsoft would enforce it for a non-commercial side project.
Trademarks have to actually be used to remain enforceable, I think. Not sure MS could claim Clippy after all this time, not that they might not try.
Microsoft uses Clippy for the paperclip emoji in the Fluent Emoji set. The trademark is why the open source version of Fluent Emoji doesn't use Clippy's likeness.