Mildly Infuriating

It sounds like both parties made derivative works.

The initial design was from Bungie, then someone else made a derivative work from it. Bungie didn't go after them for it.

Then some artist at Bungie made a derivative work from that work, and the fan artist complained.

Technically, neither party can legally go out and make and distribute derivative works. Probably both were in the wrong there.

The fact that Bungie left the fan art alone, didn't send lawyers after them initially, doesn't mean that Bungie has rights to go make and distribute a work based on the fan art.

So, from a purely-legal standpoint, they've probably both got grounds for a copyright complaint against the other; Bungie could theoretically have the fan art distribution blocked and the fan artist could block distribution of Bungie's derived pistol (though not the original, pure-Bungie pistol).

Companies still shouldn't steal fanart. If a fan makes something they like, they should work with the fan to make it official in a way that satisfies both parties. The community would love seeing that, and the company would get what they want for a reasonable price, and probably still cheaper than paying their own artists.

A comment lower in the thread says Bungie has reached out to this person, and are handling it well, which sounds great!

The devil is in the details. Different contracts state different usages.

Often, I'm hired to make things for folk, and they own it entirely. I see these things out in the world, I sometimes see other artists hired to butcher it to fit a new purpose. But that's OK, I account for that, and often I hand over the source files from the things I make... Layered documents etc.

However, there's a really disturbing trend of large companies appropriating fan art and claiming that because they own the IP any derivatives belong to them too. This is far ickier.

The main thing though is credit. You'd think that giving a nod to the original artist would be nice. It costs nothing and can have a massive impact on their business.

Yeah the question really is what the contract between the artist and "Josh" states. Without knowing that, its impossible to judge...

It depends. How dark is the kid's skin? Are they in a poor neighborhood?

All toy guns in the US have an orange tip, you can see this one just in shadow on the end. That doesn't mean there haven't been problems with what you are imagining in the past though, not smart to point it at anyone.

It has an orange end and triggers on it which marks it as a toy gun. So they'd be fine most likely. But it's still a stupid move.

a nerf gun that fires foam darts. the price is prohibitive enough that no kid is going to feasibly be carting this around under normal circumstances.

I thought the same thing. In the Netherlands it's not allowed to have realistic looking toy weapons. I basically think that's a good thing.