You are not permitted to make profit from it. Also, the law states it is copyright infringement.
In practice, it is a grey zone. Many authors turn a blind eye to it, and a few even seem to encourage it. In other words, they are choosing for the time being not to enforce their rights...either because they don't feel it's worth their time or resources, or because they don't care. However, if an author decides they are going to take legal action, they are within their rights to do so, even if they were ignoring or encouraging it before that point.
As to whether it "damages" the Trek franchise, the only area that would have any potential to be "damaged" would be the books...if the Treklit publishers put out a product that a person finds inferior to the fanfics, and reads fanfics instead, then the publisher could essentially lose to the competition.
Now, my PERSONAL feeling is that if you are a professional author with access to professional editing and publishing, then you ought to be better than a fanfic writer who is acting alone or with a volunteer beta. If you aren't, then that's your problem, not mine, and the WISE decision (though not
the one a business is likely to make in practice for the legal reasons stated above, as well as other legal reasons!) is to do what the government tries to do when they find a really, really good hacker: get them on their side.