Suppose I am designing a set of plates for the next D&D books (which I am not, unfortunately) and suppose I need to draw a monk with a slightly sneaky face. I have tried several concepts out of my imagination and they all leave me frustrated.
While sipping a cup of coffee and feeling uninspired I decide to watch funny videos from [insert random goofy videos site here] and there he is! One of the actors looks exactly like I would like my sneaky monk to look like, down to the cheesy moustache and the mousy eyes.
I decide to "draw inspiration" from his face and design my character. He ends up looking amazing, with only one problem: I did such a great job that the character looks exactly like the actor. The actor is not famous, so it is not that everybody will say "oh wow, he just drew Al Pacino" but still, if somebody would know this actor, they would recognize the resemblance.
Is it OK (and by OK I mean is it moral and/or legal) to use this design without the actor's permission?
Answer
Morally is really impossible to answer. Everyone is going to have a different opinion on this and context matters.
Legally the issue is about appropriating one's likeness. This isn't strictly against the law, but like most intellectual property issues, there's some caveats:
http://www.owe.com/resources/legalities/7-issues-regarding-use-someones-likeness/
The one caveat that is likely most related to this would be:
(5) Invasion of privacy by commercial appropriation / rights of publicity
These rights are violated when a person’s likeness is used on or in connection with products or merchandise (“goods”), or to sell or advertise goods or services. With respect to artwork, the courts have generally considered works of fine art to be expressions of the First Amendment rights of free speech, and thus immune from liability for violation of privacy or publicity rights. Only commercial reproductions of the artwork qualify as goods under this standard.
Still, no clear/easy answer here. Context will matter a lot.
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