This is spongbob doing Gangnam style. Its takes a popular song and a very popular TV show and blends them together. I think it works really well because it incorporates dance moves from the characters and also has their lips moving to the words. It makes the video look believable. I dont think it crosses any line because the owner doesn’t make money off of it and it give the title of the song and who the song is by.
According to the article I feel like this would fall under a parody. Using spongbob as the dancer for this song is kinda like making fun of it. Which a lot of parodies do. Also, this user added the nature of the original work. He said what song it was and gave credit to it that way. Its also more creative then then factual so it makes the video light hearted and funny.
Its probably not fair that this person used the song, they had no rights to it. But on the other side spongebob wasn’t giving a bad light to this song. It probably promoted it because of everyone who watches spongebob and doesn’t listen to Gangnam style.
I think its okay to use this and do this video. There is no harm in using the song or spongbob. I dont think either creator of these things would be upset about this youtube video.