Step one would be a 'cease and desist' letter informing the person that they are infringing on copyright (include the legal backup for this- the part in the user agreement) and they are to stop right now or you will take action against them.
If they don't, then you'll need to have your lawyer start getting ready to sue.
Please be aware that if you did not specify this copyright in your user agreement, you're probably out of luck.
I looked around your profile for an insight into this whole situation. I saw it was some shitty chibi thing and went and watched some Die Antwoord on youtube. I still don't know if they're a serious group or a giant joke. It's just bizarre and too fucking hipster to be serious.
Getting back to your problem. I don't care about your shitty app. It's apparently free, so you already have a shit business model unless you're generating some serious ad revenue, which would mean a fuck tonne of ads in your app which would be annoying and no one will want to use it then.
Either way, you're fucked, I don't care, and I still don't understand Die Antwoord.
Really? That doesn't make since. I mean Photoshop generates images too, does Adobe own all content by their apps from all artist? Or are generated images you are saying, are really 'pre-generated' images? It's really confusing of what the app really does.
Oh sorry for the confusion. This is an avatar creator and dress up game for iPhone and iPad called Chibi Me. Now in TOP 10 in social networking category in USA. (No advertisements in the app, but has in app purchases where people buy new items.) The images generation is basic: people choose from available eyes, lips, hats, hairs etc and create a chibi face. But this person -I already reported to Deviant Art by the way,they are working on the issue hopefully now- is selling the avatars as adoptables.
Thank you for your helps, i think i will solve it with Deviant Art.
You owning a software company, you should already know about all the copyright laws! Contact that Deviant first. If they don't remove upon request take legal action against them or seek legal advice about this whole thing!!
This forum is complaining. If you want legal questions answered, consult a lawyer, not a bunch of people on the internet with various backgrounds in which one of them knows much about law is roughly 0.