Okay... So the Foundry EULA states that we can use copyrighted material from the properties. It also states that we cannot recreate the likeness of actors. In a Q&A session, Branflakes responded to a question about characters in makeup, affirming that the use of characters in full makeup from the shows does not violate the Foundry's EULA.
The clarification seemed wanting and confusing to many.
So I've read the relevant caselaw and a load of scholarly articles to understand the issue. The big case in the field is Wendt v. Host International Inc. for those curious.
Here's the deal: There are two forces at play. Copyright, which includes characters, likenesses, and mannerisms, versus Publicity Rights, which include an actor or personality's mannerisms. Copyright is federal. Publicity Rights is a state issue. Copyright preempts Publicity Rights except when Publicity Rights are focusing on a separate issue. I've focused on California law (which is some of the most broad) in an attempt to understand the EULA.
CBS is licensing its copyright to authors. It cannot license what copyright does not cover. Therefore, the question is what copyright covers.
I am going to break the issue down, point by point, in what amounts to rising criteria:
1. Is the character a real person? Ie. does it possess, it its entirety, the name attitude or traits associated with the performer, such that there could be no distinction made? If so, STOP. If not, proceed to point 2.
In the case of a real person, CBS has no copyright and therefore cannot transfer one to authors. If it is a real person not playing a character (ie. Shatner hosting a TV special) then CBS cannot transfer the rights. Hence the reason why real people are stated as not being usable in the Foundry.
2. Does the character contain elements developed specifically for the Star Trek properties as defined in the EULA, such as clothing, makeup, favorite foods, personality traits which may be distinct from the actor? If the character possesses none of these, STOP. If so, proceed to point 3.
CBS' claim to copyright depends upon the idea that the character possesses original traits, distinct from the actor. There is some debate over whether characters can be copyrighted apart from the films, books, television shows, and other media they appear in although consensus leans in this direction. In any case, there must be defining elements which CBS owns (such as involvement in storylines or unique traits) in order for CBS to have anything to share.
An example of this would be the playwright Samuel Beckett, who is mentioned by Sisko. I pick him because he is a modern enough figure to still be covered by his own copyrighted works and publicity claims. The version who is mentioned in Star Trek might be fictionalized; after all, he lived in a version of Earth that had been visited by Starfleet, Ferengi, and even an El Aurian. HOWEVER, the mention of Beckett on DS9 in no way sets him apart from the historical figure. So you cannot claim that this is a DIFFERENT Samuel Beckett.
However, while Jean-Luc Picard may resemble Patrick Stewart, Patrick Stewart is not a starship Captain. He does not own rights to or wear the uniform. He is not French. He does not have an artificial heart. Note, I'm not saying you can use him. I am saying he's not ruled out YET as of point 2.
3. Does the character likeness resemble the actor in a way that would cause confusion as to whether the character IS the actor? If it is a reproduction of the actor's natural face, STOP. If it is not, CONTINUE to 4.
At this point, we've eliminated Picard as he generally appears... We have not eliminated him, say, in his disguise where he was surgically altered to appear as a Romulan. We have eliminated Riker and Troi and both Crushers but NOT Data or Geordi (with his VISOR, anyway).
4. Is your use in any way creating confusion between the character and the actor? That is to say, would the actor likely be recognized and the role not recognized by the target audience, ie. players of Star Trek Online. or are you making references to the actor's career outside of Star Trek? (Audience is relevant. See Landham v. Lewis Galoob Toys, Inc.) If so, STOP. If not, proceed to point 5.
This is largely a necessary pitstop. If the role would not be recognized by the audience, likeness is being exploited more than copyright is. Authors have access to copyright but not likeness rights. For example, use of Dwayne "The Rock" Johnson as the Pendari Champion on Voyager. Using the Pendari Champion in a wrestling match (he was a boxer on the show) or casting him as a sheriff or a Scorpion King would be an example of using a character to exploit the actor's fame.
5. Does your character resemble the actor to the extent that your interpretation of the character could not be played by another actor with approximate but not exact physical characteristics, using copyrighted costuming elements? If so, STOP. If not, proceed to point 6.
This is the big one. A man with Michael Dorn's build in Worf's makeup is not something Michael Dorn would have any claim on unless by specific contractual arrangement. Any claim Michael Dorn would have would be to something more specific than his jawline or skintone, which courts don't recognize. Someone else in the Quark makeup or Odo makeup would still resemble Quark or Odo. In fact, with Worf, his stand-in would face the camera.
However, if you recreate Data, it would take more than a casual match to Brent Spiner to pull off the illusion.
As of this point, you could, in fact, use any character in an EV suit that blocks the face or that blocks enough of the face as to create uncertainty as to who the performer would be. Likewise, you could use characters at ages or in states of mutation or deformity that would create uncertainty as to the identity of the actor.
Basically, you're good if your interpretation could be played by another actor of the same height, weight, build, and physical characteristics and there is uncertainty about many or all of the actor's specific features... or if you have intentionally deviated from the actor's specific features to the extent to render the actor non-identifiable versus someone who looks similar.
There is ONE more point, however, and this covers why there was a change in policy on Cryptic's part, leavening restrictions.
6. Is your usage confusing in a way which might imply endorsement on behalf of the actors in a product which provides Cryptic Studios or CBS with financial gain?
This is the big one and why Cryptic lightened up (and likely had their own restrictions lightened).
Free to Play.
It MAY lure people to the game but it won't make them spend money directly. As long as Cryptic or CBS make no money off it directly and it meets points 1-5, it's clear.
Ultimately, the "Cheers Robot" case I alluded to earlier boiled down to this: while the robots didn't resemble Cliff and Norm, it invoked the essence of their performance in order to draw people into a place of business where there was an expectation of purchase and Cliff and Norm themed merchandise. As long as Cryptic explicitly says there is no expectation of purchase to play missions, those missions have a wide berth for what they can contain.
If your Foundry mission isn't selling anything and Cryptic and CBS receive no money from people playing, with no admission and no prohibition on loitering, points 1-5 are all that matter. CBS and Cryptic are covered legally. The EULA is satisfied. There you go.
I covered the nuance but the bottom line is this:
As long as you could imagine another actor (a broad type, build, jawline, etc.) looking like your Foundry character, you should be clear. You can portray any CHARACTER as long as it would be plausible that you "re-cast" them using an actor of the same general height, build, and jawline. If there is no doubt who the actor portraying your character would be, that's when you can't use the character.