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From my understanding of copyright as it relates to fanfiction, I believe that fanfiction can be protected/safe from copyright violation as long as it falls under the fair use policy. I believe that as long as the fanfiction is not for commercial purposes, creates a unique story, and does not use much of the original source material, it should be safe from any copyright violations (in most cases).
I think that the fanfiction stories that would violate copyright law would be the stories where the author is either blatantly copying a large portion of the source material, or stories where the author is trying to monetize their work. Other stories that could violate copyright law are stories that deal with trademark or copyrighted characters such as Mickey Mouse or Simba.
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