As far as I know nothing happens. Jack Wolfe's had his name since launch and I don't think he's heard a word about it from NCSoft.
I know someone who has names from before badges were entered that match up with characters being mentioned within them. The penalty is having to deal with people frequently sending tells "Do you know that...blah blah blah" or threatening to petition the name for any sad little reason.
The same player has the name of an NPC who is the target of at least one red side mission and requires rescue in one or two blue side missions. Never contacted by devs/NC Soft over it, though.
I wouldn't suggest re-making said characters, though, the names might actually be blocked and you just get to keep it via a grandfather clause (I've heard of people losing names when remaking and then discovering the name is blocked). Maybe check on other servers first. If someone else suffered such a fate, you'll discover the name blocked.
From what I've gathered from those that are in the situation: They were concerned and contacted NCS and were informed that as long as they don't try and get the name >now< then it's all good. The name is blocked, but that's only during creation. It's a bit like IBTL.
@bpphantom
The Defenders of Paragon
KGB Special Section 8
I have a name (Bad Karma) that became a NPC (Pocket D entrance in Faultline) around Issue 7. The only real issue is if you delete/remake the character you will lose the name if it is blocked.
Heroes: Apogee | Bad Karma | Havocbolt | Novastar | Ranger | Wyvern |
Villains: Relic | Mad Havoc | Wreak Havoc |
... lurking since the beginning.
There's the often repeated story of someone who had the name Frostfire before the Hollows were added. They did get slapped with a generic but contacted customer support to appeal it since they had the name before there was an NPC. (Note that anyone can appeal having a name or costume made generic; it just usually doesn't work) CS checked when the character was created and did restore the name to Frostfire, making a note of it so later GMs would know not to change it again.
"Mastermind Pets operate...differently, and aren't as easily fixed. Especially the Bruiser. I want to take him out behind the woodshed and pull an "old yeller" on him at times." - Castle
This is kind of a distant cousin to the NCSoft Naming Policy thread that's been here for a bit, as well as something about which I've been wondering for a while. I doubt that anyone will know NCSoft/Paragon Studios' exact policy in this area, however, one or some of you may have run into this "issue" at some point.
As more and more NPCs are introduced into the game, what happens when the names they are given are names that are already held by players? The names of most, if not all, of the NPCs who were present at launch have been blocked, but it's (obviously) impossible to block all potential NPC names. Additionally, it doesn't seem like the devs check the availability of names before they create new NPCs, and rightly so; it would be somewhat preposteros to expect them to find and choose names which are available across all of the servers.
So, what actually happens when an NPC is introduced with an extant PC name? Are players contacted? Or does nothing at all happen (which is what I'm assuming, but would be happy to be proven wrong)?