https://www.youtube.com/watch?v=Ug0VRepc72E
This is a great video to explain the limits of Fair Use and copyright when it comes to video games, and is relevant to our community here. I gained a lot of useful information from this video (I watched the original SidAlpha video too, but this one is better backed up)
Note that this should not discourage modding here - it is the reason, however, that we should be mindful of using other assets. Or creating a standalone or recreating the game in another engine. Lucasarts does have legal rights to order us to take down any of our mods, but we have had discussions here about how they encourage modding, so that is not a big fear. For greater discussion, see here: http://www.swbfgamers.com/index.php?topic=12474.0
Once again, not to incite fear, just informational. If you've read the 2nd link, you can see the EULA that Disney has actually broadened as compared to the original mod tools EULA.
Mods sort of exist in the same weird legal zone that fan art is in.
It's something the IP owner has the right to obliterate at anytime, but tends not to unless provoked.
Contrarily, fan art is made from scratch, while mods are manipulating an actual product. Hence there's an implicit difference in the ethics of selling either.
Fan games based on an IP have a big cease-and-desist target painted on their head most of the time. Unusual examples would include the Black Mesa title.