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Sprite Usage
Sprites give the potential for Cease and Desist and lawsuits. Will you continue to use them?The web is full of sprite projects. Just taking a look at the number of Video Game Parodies on Newgrounds, it's no surprise that using sprites is a popular way to make parodies and different projects. What are Sprites?
The Golden Question: Is it Okay to Do Flashes with Sprites from Video Games? However, there have been hundreds upon hundreds of people making sprite parodies. It's not a secret matter that people use sprites from popular games like Final Fantasy and Super Mario Bros to make interesting projects. It should also not be a surprise to Nintendo, who has made very little movement to crackdown on copyright violations. Nintendo could always come back and tell people to stop, but due to its absence, it would seem to be that it would be okay. You need to know that sprite usage is most likely in violation of copyright if you were put in a court situation, as it does not pass all the qualities of "Fair Use" in copyright law. However, given the situation of sprites, you should feel safe to use them. Can I make money with sprite movies or games?
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Sprites are clips of moving video game characters and scenery, caught as stills in image format. They are usually caught from earlier video games from the Nintendo and Sega consoles. The form they are usually used are animations of comical nature, in a parody of video game situations. Some animators do not approve of using sprites, because of it's lack of original content. Others feel that the entertainment value should be what is important, but that is another arguement for later. 
This is a really hard question. The legal answer is maybe. You may claim "fair use" for using the sprites in a form of parody, but if the characters are directly copyrighted, you need to ask before using.