Copyright infringement - are we liable and what should we do

[Mimi]

Hi there

I am actually a solicitor myself but in Private Client so this area of law is very alien to me.

My husband received a letter from a photographer who has said my husband used one of his photographs for a website of his. My husband is an online marketer and sub contracted some work out to a lady in the US to conduct this particular piece of work. He had no involvement in the building of the website including the collation of the image which was used on the website.

When he received the initial letter from the photographer he immediately took down the website but did not respond to the letter as he completely forgot to do it. He has since received a letter from the photographer's alleged solicitor asking for a settlement of £2,000.

Let it be known my husband had no knowledge of the image being used and certainly no knowledge there was any copyright attached to it. He also made no financial gain from using the image.

We are a nice family with a 2 year old and a baby on the way in October and could really do without this stress. I tried talking to the photographer today but he was really rude and mean and very unhelpful.

Should we settle, ignore or fight?

Your initial advice would be much appreciated.

THANK YOU!

[AndyJ]

Hi Emily,
As you are probably aware primary copyright infringement is a matter of strict liability and so your husband's knowledge of this alleged infringing use would have no bearing on any possible finding of the court, but as this would appear to be secondary infringement (s 23 of the CDPA) then he should be able to rely on the defence that he neither knew nor had reason to believe that the image was an infringing copy of the work. If the court accepted this defence, then under s 97(1) CDPA the range of remedies available to a claimant would be limited to just an injunction and seizure. Since your husband has already taken down the website (or removed the disputed image) an injunction would be unnecessary and as there is no physical object to seize, this being a digital file, really there can be no gain in a claimant litigating. But as will be all too familiar to you, this is no bar to someone who is determined to pursue the matter, even if his solicitor advises against such a course of action. However I think it would be relatively easy to convince a court that whilst a claimant might have a realistic prospect of succeeding on a claim of infringement, it would not be a good use of the court's time for the matter to go to trial, given the prospect of there being no remedy - equitable or otherwise - for the court to award, and that alternative dispute resolution would be a more suitable course to follow.
In the event that the claimant is determined to litigate, then I think the case would be allocated to the small claims track of the Intellectual Property Enterprise Court, where your husband could perfectly reasonably represent himself, so keeping his costs down. As an example of how the IPEC (or PCC as it was formerly known) deals with such cases, here's a recent case with some similarities to that of your husband: Delves-Broughton v House of Harlot [2012]EWCC 29
As for settling, I suggest that the figure of £2,000 sounds wholly unrealistic in the circumstances. I am assuming that the image wasn't on your husband's website for more than twelve months, in which case a fee of even around one third of that amount would still be pretty extravagant (see the NUJ's guide to fees* for licensing photographs, for instance). My feeling is that the photographer is seeking to introduce a punitive element into the fee being demanded, and that this should be resisted. Not knowing any details of the actual image or how long it was used for on the website, it is hard to suggest a counter-offer figure, but I think somewhere around £250-350 might be reasonable.
I think it would be sensible not to ignore the photographer, as that may encourage him to resort to litigation, and I don't think the court would look favourably on the failure to engage in dialogue. However once it has been pointed out to the photographer that he has very little hope of recovering any damages through the courts, for the rerasons I outlined above, he may see reason and either drop his claim or settle for a modest amount.


* This site hasn't been updated for some time, but anecdotally, rates have not changed much in recent times.

[Mimi]

This is most helpful, thank you.
As he has now involved his solicitor should we write to the photographer directly or to the solicitor?
Just to clarify the facts he was involved in the building of the website but not in the collation of the images and the putting together of the video.
The domain name also expired 6 months ago so the website has actually been inactive since and was inactive when the photographer wrote to him.
Many thanks

[AndyJ]

Hi Emily,
I think it would be best to correspond with the solicitor if you have his/her details. They are more likely to appreciate your husband's claim to be only liable for secondary infringement, and thus the relative futility of taking the matter to court or for pressing for an inflated settlement, in such circumstances.
However your husband's position may be weaker than I had first appreciated, in light of the fact that your husband was actively involved in building the website. It may well be seen that he was the directing mind behind any infringement, even though the image was procured without his knowledge, and thus he is in fact liable for primary infringement. Were this to be the case, then as I mentioned previously, the doctrine of strict liability will operate.
If he has any paperwork concerning the commissioning of the American woman who undertook the procurement/collation task, it might help to clarify where liability might lie. I think it unlikely, but if her contractual terms explicitly included indemnifying your husband (her client) then clearly that assists your husband. In my experience, these things are rarely that formally set out, and at best there may be a few emails setting out the commissioning process. You should examine them for any wording which might imply an acceptance of liability on her part. What exactly was said about the source of images? Did her invoice include fees for licensing images etc, and if so how specific are these references, eg are there details of actual picture agencies? It is possible that the disputed image has been legitimately sourced from a third party who was licensed by the photographer. If so your husband will need to get an affidavit from the American woman. Much will also rest on her professional status (claims on her website, incorporation of her company etc) and whether she has any indemnity insurance.
Your second posting mentioned a video. Is it alleged that this also infringed the photographer's copyright? If so, was this a separate image from the first image you mentioned?

[Mimi]

I've just had a long chat with my husband. He and the lady in the US built the website together and agreed a 50:50 split of any profits (there were none). The 1 image in question was used in a video which my husband had no involvement in making. The 2 URLs provided by the solicitor no longer work as the video has been taken down.
The solicitor quotes s107 for criminal liability.
They ask for full disclosure of the use of the image.
He is claiming civil damages for use of image, unauthorised use of image and damages under s97(2) and collection of costs incurred.
They have demanded a response by close of today.
I'm so upset and worried...

[AndyJ]

Emily,
There is no need to get alarmed by this. I don't think there is any real prospect of this claim going to a hearing in court. The solicitor is using immoderate language and unrealistic timescales to scare your husband. There are absolutely no grounds for claiming s 107 criminal liability. If that was the case, the solicitor would not be handling the matter and would have handed it over to Trading Standards. Criminal liability is intended for things like large scale counterfeiting operations involving criminal gangs; this is a straightforward civil matter.
Secondly from what you have told me, there are absolutely no grounds for claiming flagrancy, in that your husband took down the site/image when first informed of the alleged infringement and has not used it since that time; furthermore the photographer has not (and I suspect, cannot) demonstrated any additional losses which would invoke s 97(2). As you well know, the court, if it were to try this case, would be seeking to put the claimant back in the position he would have been had this use been licensed in the normal way. Exemplary damages are exceptionally rare in cases of this sort. Furthermore, full costs are not invariably awarded against the losing party. Indeed the IPEC and its small claims court monitor costs closely throughout proceedings from the CMC onwards. The conduct of both parties is taken into account in deciding the quantum, under the following heads:

(a) conduct before, as well as during, the proceedings and in particular the extent to which the parties followed the Practice Direction – Pre-Action Conduct or any relevant pre-action protocol;
(b) whether it was reasonable for a party to raise, pursue or contest a particular allegation or issue;
(c) the manner in which a party has pursued or defended its case or a particular allegation or issue; and
(d) whether a claimant who has succeeded in the claim, in whole or in part, exaggerated its claim.

Source: CPR 44.2 (5).
I suggest you should read CPR Part 44 as it will put you in a better position to counter some of the wilder claims from the other side. And of course the claimant would not be entitled to costs if his claim fails. So adding them in at the start of settlement negotiations is somewhat presumptive.
As a matter of interest, has the solicitor provided any evidence to support the claim that the photographer actually owns the copyright in this particular image? For instance was there any embedded metadata or a watermark to this effect on the image? Was the image so unique that there is no chance that the image used on your husband's website is actually a different but similar image to the one in contention? It is easy overlook these small but important details, and assume the issue of copyright ownership has been established.

I think that, should this get much more serious, your husband would be well advised to find and consult a solicitor with IP experience; obviously this site cannot provide the level of tailored professional advice required to guide him through litigtation.

[Mimi]

I cannot thank you enough.

I have sent a letter to the solicitor so fingers crossed all will be ok....

THANK YOU!

[Sidewinder]

Hi,

Just to bump this topic.

Just to clarify, if a company who sells prints of a specific design which was provided by a rouge designer ( someone copied a design of someone else), how would the company protect itself from any claims of damage as they would be unaware of false ownership? What precaution measures would one do?

[AndyJ]

Hi sidewinder,
There are two measures someone can take. The first is what is referred to as 'due diligence' and involves careful checking on the background of the person or company supplying the designs, for example by getting references from previous clients/customers, checking credit agencies, Companies House etc. You can ask your local Trading standards if anything is know about the company: they won't tell you if there is a black mark against them (unless it's a criminal conviction) but a negative 'nothing known' response can be reassuring. If you have samples of the designs, these can be checked against the IPO's database of registered designs (both UK and Community Designs) but this needs care to ensure that as many key words as are relevant are used in the search. And do an image search via Google or Bing or Tin Eye etc to try and discover if anyone else is claiming the design as theirs.
The second thing to do is to ensure that any contract between the supplier and marketing company includes a comprehensive warranty clause which indemnifies the seller from liability if the goods are found to infringe the IP rights of a third party. If the supplier claims to have made the designs under licence from someone else, check the licence with that third party to ensure that a. the licence is genuine and b. that there are no restrictions in the licence on sub-licensing or any of the proposed activities in the territory where the marketing company operates. For example, quite often a legitimate licence will allow a licensee to sell or distribute the goods in a particular territory but not in another where a separate licence may have been issued to another licensee.

[Sidewinder]

Perfect, Thank you

[Gprit]

I have a similar situation in that I actually built a website for someone.
The someone has now received a demand for copyright infringement and damages of £1000 if paid within 14 days....£2,300 if after that time).

The image is an innocuous thumbnail image of a jacket potato with cheese on top(!). I would probably have obtained this from one of the free image libraries that abound. The image is not watermarked and bears no digital copyright notice.

The claiming company (stockfood.co.uk) have watermarked their stock image. Having looked around the internet I am confused! There is the same image on Getty Images and other image sites, all seemingly with their own watermark and image rights.

Who owns the copyright? Is it Getty Images? Is it stockfood.co.uk? Is it the (same) photographer? If the latter then should not any claim/action come from him?

Naturally the image has been taken down but that seems to be no defence.
Did the UK Enterprise and Regulatory Reform Act 2013 finally get passed to clarify the issue of 'orphan' images?

thank you

[AndyJ]

Hi Gprit,
Taking your last question first, yes orphan works legislation is in place and you can find details about the system here.
However I don't think that will be of much use to either you or your client, since you would have needed to have gone through a diligent search process which would have turned up the various stock agency images which you mention, and so the work could not be claimed as an orphan.

As for the status of the image in question it would certainly seem to be subject to copyright, despite the fact that you found it on a 'free' image gallery. Regrettably these websites are notorious for displaying images as being free of copyright when they are not.

It is possible that the original photographer has placed his image with several stock agencies, although most of them insist on exclusive contracts as it avoids the very issue which you alluded to, namely, the same image being available from multiple sources, some of which may have no legitimate right to be making them available. When a photographer signs up with a stock agency he or she will be required to assign his rights to the agency and thus the agency can then take action against any alleged infringement.

Turning to your client's specific experience, I suggest that the fee demanded is exorbitant. In the normal course of a copyright infringement court case, the claimant can only expect to recoup in damages what they have lost due to the infringing use. So in this case it would be the appropriate fee which the agency could have charged for the use which was actually made of the image. Since you say that this was little more than a thumbnail, I would have expected the fees to be in the tens of pounds* rather than the thousands. If the matter goes to court it is by no means certain that a claimant would be able to recover all their legal expenses, and so it is unreasonable for the company to add more than a basic administrative charge to the penalty it is now seeking ( say, perhaps 10-15% of the usage fee). There is no legal basis for increasing the amount demanded due to a delay in settling the matter. Neither you nor your client are in a contractual arrangement with the agency and so you are not bound by any additional terms (such as the late payment penalty) which they may seek to impose. Nor can they pursue the matter through the normal money small claims system, for the same reason.

It would sensible for your client to seek legal advice, perhaps through Citizens Advice, on how best to deal with this claim. And afterwards you should be prepared for the client to look to you for reimbursement of the amount needed to settle the matter.


* I have just looked at the stockfood website, and found an image of a baked potato with a chilli co carne topping, for which the online media editorial use fee for one year is £38. For advertsing use, it would be £155.

[Gprit]

Many thanks for the comprehensive reply.
The website has only been active since January. Before using the image I did look at a couple of Stock Image websites (eg 123RF/istockphoto) as these are where I always purchase images when I need them.
There doesn't seem any other way of discovering who may have the image(!), so I think my due research could not have done more, and as mentioned there is no copyright attached to the image.

I'll draft a letter along the lines suggested - although my inclination is to call their bluff in taking formal action over such commonplace image.

thanks again

[Gprit]

Can I just double check that the following is correct:
" In the normal course of a copyright infringement court case, the claimant can only expect to recoup in damages what they have lost due to the infringing use. So in this case it would be the appropriate fee which the agency could have charged for the use which was actually made of the image. " (which the reply correctly stated was £155).

The costs they are seeking are:
Standard Licence Fee £ 233
+ vat £ 46
Post Usage Licensing Surcharge £1165
Surcharge for not crediting image £ 233
Infringement Detection fee £ 326
Infringement Collection fee £ 326
------------
total £2330

They also claim that THEY have exclusive rights for the image, BUT it is also on the Getty Images site - and I think they work excusively(!)

thanks

[AndyJ]

Hi Gprit,
Damages in civil cases are intended to put the injured party into the position he would have been in if the use had been authorised correctly. There are two methods of calculating damages (and the successful claimant can choose which he wishes to claim), the first being based on what the claimant has lost (licence fees etc), and the second is the profit the infringer has made out of his activities. So for instance in your case the second method (known as an account of profits) would not be sensible because there will be (I assume) no profits directly attributable to your client's use of the baked potato image.

A claimant in court is not entitled to any surcharges or other punitive element or administrative fees as a part of damages. There is one exception to this, and that is where the infringement is found to be flagrant. The sort of circumstances where flagrancy might apply would be where having been notified of an allegation of infringement the defendant takes no action and continues the infringement, or where an infringer has taken an image and deliberately removed the copyright notice on it before using it in an infringing manner. I can see no reason why flagrancy could be claimed in your case.

In addition to damages, a successful claimant can be awarded costs. The amount which can be claimed under specific headings (court fees, legal costs, travel costs, letters, phonecalls etc) is tightly capped, especially if the claimant opts for the small claims track (pdf) of the Intellectual Property Enterprise Court (IPEC) where only very limited legal costs may be allowed, and certainly this wouldn't include surcharges of the sort you mention. What's more, an award of costs is at the discretion of the court and the amount can be reduced or denied altogether if the complaining party fails to act reasonably and follow the pre-action protocols.

Finally the charge for using the image without a credit is somewhat spurious. In order for a copyright owner to be credited, he must first assert his right, and this must be communicated to the person using the image beforehand. In view of the circumstances through which you came to use the image, there can have been no such assertion, and if as you claim, there was no copyright or other identifying information on the image, I can't see a court upholding this particular part of the claim.

I can't really comment of the exclusivity issue, but it does seem that their claim is at odds with the facts if Getty also licence the same image.

As it sounds like you have grounds for resisting this demand, I would strongly advise getting a solicitor (who specialises in IP) to take up your case. You can find a suitable local solicitor via the Law Society website (just put in your location and select Business, Media IT and Intellectual Property from the Legal Issue drop down menu). You can usually get a free initial consultation which allows you to outline your case and find out the likely costs of engaging the solicitor you approach, before committing yourself to any expenditure.