If I understand this correctly: Bill never purchased the item from Person A. Steve purchased the item from Person A. Steve altered the item, then sold the entire item (not just his alteration work) to Bill. He also sold it to others. Bill is also giving away Steve's altered version to others. Person A only got paid by Steve and hasn't seen a dime from any of the subsequent reselling. == IMHO Steve, Bill, and anyone who obtained the item from them knowing it was really Person A's are all equally in the wrong. Essentially, they are all trading in warez for profit. In the other hypothetical scenario that's been brought up, if Bill had purchased the item from Person A and paid Steve to alter it for Bill's personal use only, that may or may not be OK. It would depend on the terms of use and nature of the item. Generally, unless it is a specificially stated restriction of the license, altering something for your own personal use is OK to do (noting again that you lose any "warranty" protection you may have otherwise enjoyed). Whether you pay a third party to make the alteration isn't relevant as long as you are the only one who uses it. This doesn't sound like the case here, but its why adding a scar or body hair to a texture to use only in your own renders isn't a problem (for example). At least that's my opinion when considering this hypothetical but most distressing scenario.