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Can someone point me to a law review article that covers how characters can be copyrighted? I understand that the text of the book can be copyrighted, but characters? That seems like a stretch.

How does fan fiction exist at all? Authors have the legal right to go after fans, but choose not to? In this legal climate, I highly doubt that.

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Copyright includes rights to the work itself as well as rights to creating derivative works, such as sequels, movie adaptations, etc. This does effectively mean anything using the same characters or settings, although the characters themselves are not technically copyrighted.

This is a decent review of the issues involved: http://io9.com/5933976/are-fan-fiction-and-fan-art-legal

> Authors have the legal right to go after fans, but choose not to?

This is actually pretty much exactly how it works. Fan fiction is generally a "derivative work" but most creators and publishers realize that there is no real incentive to go after most of it, and a serious disincentive in the form of bad PR among the exact groups of people who are already buying their stuff.

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