Legal Question in Intellectual Property in California

Copyright infringement is not determined by whether you charged a fee or profited from the infringement, so you are not off the hook simply by not charging.

It is likely that a company claiming infringement would go after all the parties involved, including the designer, the seller, and the end customer. To be safe, you should request from your client proof that they have "cleared" the intellectual property owned by someone else. This might be in the form of a contract or even a letter granting permission for the use. If they cannot show such permission, your agreement with them (in writing) should "indemnify and defend" you against any claims. This means that if you are sued, they have to pay for hiring a lawyer and any damages that a court rules you owe. Or, even better, just say no to breaking the law.