Copyright infringement via Permission Machine, acting on behalf of Alamy

[danieleros]

Hey there, hope you are safe and well at this time.

I run a small news website here in the UK and we recieved an email a week ago from a company called Permission Machine who are bascially claiming we have used an image without a vaild license.

They say this: "We are the agency appointed by Alamy to check for possible unlicensed image uses, and we have seen that you are currently using one or several images from the Alamy collection on your website."

The image in question was supplied by a third party and I am currently trying to work out if they have a valid license or not. This is taking longer than I would hope.

Permission Machine go on to say the following: "We warrant that Alamy has been duly granted by the respective owners or licensors of the Images, rights to the image(s) mentioned in the letter to which this declaration has been attached (afterwards the ‘Image(s)’); and

"That Permission Machine Ltd. with UK company number 11747843 is authorised to act as our representative to pursue potential copyright infringements for the Image(s) and represent us in court; and

"That Alamy has all necessary rights to the Image(s) to grant Permission Machine Ltd. the authorisation to settle and pursue infringements on our behalf."

They are trying to charge a sum of just over £400 which seems very high when the image is available for download today from Alamy for just under £40.

What do you think I should do and how worried should I be of any legal action if I simply refuse to pay up etc?

Any help would be much appreciated.

Best wishes,

Daniel

[AndyJ]

Hi Daniel,

Unfortunately you are far from being alone in facing such issues. It seems to be a growth area as far as speculative claims are concerned, now that PPI claims are a thing of the past.

Rather than repeat what we generally say about how to deal with claims like this, can I please refer you to some of the other threads which cover this, albeit involving different claims management companies to the one in this instance. They all operate on a similar basis.

PicRights Letter for Infringement
PicRights Solicitor demanding Fee
Pixsy Demands
KodakOne asking for Payment
Pixsy.com alleging Copyright Infringement

You need to try and locate the image in question on Alamy's website and make a note of the standard fee they charge for the actual use that you made of the image on your website (usually it's a choice between editorial and commercial/display). That figure should then form the basis of any counter-offer you decide to make, as it represents the actual loss to Alamy, rather than figure of around £400 which I suspect includes a large element intended for the enrichment of Permission Machine Ltd.

Although it has little to do with the main part of the claim and the action which you need to take, it is worth pointing out that Alamy's statement that they have authorised the Permission Machine to 'represent us in court' is probably utterly meaningless (see section 96 together with sections 101 and 101A). If the matter was to be dealt with in the IPEC small claims court, no-one needs legal representation and that would also apply to you if you are unlucky enough to be in that position in the future.

The Companies House listing for Permission Machine makes interesting reading.

[danieleros]

Thanks for the reply Andy, this is much appreciated.

- So do Permission Machine have any legal standing to bring any claims before a court?

- You say below: "If the matter was to be dealt with in the IPEC small claims court, no-one needs legal representation", are you saying they would then drop Permission Machine so they would not then get their cut of any awarded fee?

- Are they representing Alamy directly, or the actual photographer that has listed this image with Alamy via Alamy (if that makes sense)?

- If the matter was to be dealt with in the IPEC small claims court, what is the maximum amount they could win?

I have gone back to them to question the amount they are seeking, which looks massively inflated. They have come back and basically said it's because:

- Loss of Profits
- Unfair profits made by the infringer as a result of the infringement
- Proportionate legal costs and other expenses incurred by their client and themselves
- The license price I have identified from their client’s website is the cost of licensing to use the image correctly

Thanks Daniel

[danieleros]

Also, you said: "The Companies House listing for Permission Machine makes interesting reading."

Can you explain a litle more? Is it this bit: 3 officers / 2 resignations

[AndyJ]

Hi Daniel,

Yes, Permission Machine cannot bring a case in their own name unless the photographer assigns the entire copyright to them (which he isn't going to do for obvious reasons) or they somehow become the exclusive licensee, which they can't because Alamy are also licensees. However what the blurb from Alamy actually said was 'represent us in court' which is perfectly possible in the IPEC small claims court, provided that the claim is brought in the name of the photographer. The court would expect the photographer to attend the hearing, assuming that the action was defended. If no defence was entered by you, then the case would normally be dealt with on paper without a hearing. However that is all hypothetical as I am reasonably sure this won't turn into a court case. I suspect that the contract between Alamy and Permission Machine would prevent PM from being excluded from any award made by the court. Typically these claims management companies get 40-50% of anything recovered as a result of their involvement. As far as I can tell from the email you quoted, it seems as if PM are just representing Alamy. Claims in the IPEC small claims court cannot exceed £10,000. However it is hard to see how they could make a claim for an amount which exceeded what they have already demanded from you, that is, in the vicinity of £400, for the reasons given below.

I hope you have read enough of the other threads to know that if the claim went to court the only thing the photographer is entitled to is damages equal to what he has lost by you not obtaining a licence in the first place. That is to say the normal licence offered by Alamy. It is true that an alternative method called an account of profits (ie the amount of profit you made as a direct result of the use of the image) can be chosen by a claimant instead, but he can't have both. From what you have told us about the use of the image, it doesn't sound as if you are selling anything through your news site, so I can't see where there is a case for an account of profits. If, for example you earn money through subscriptions to your site, or through advertising on the site, it will be exceptionally difficult for the claimant to prove that the presence of the image made any material difference to your income stream. And finally if the matter went to court, the only thing the claimant is entitled to claim in addition to his damages is any court fees (there's sliding scale based on the value of the claim) and the claimant's personal expenses on the day of the hearing, typically his travel costs and any loss of earnings on the day. Legal costs are not normally admisssible. You can find a link to the guidance notes for the IPEC Small Claims track in one of the other threads. This will explain these matters in more detail.

So, since the court would not award both damages ('loss of profits' in PM's email) and an account ('unfair profits' in their email) nor any legal costs, and damages would be assessed purely on the cost of licensing the image correctly, their breakdown shows that the amount demanded is clearly excessive and disproportionate. There are no circumstances in what you have told us which could result in a claim for additional damages, which usually only arises when the alleged infringement is flagrant, eg you refused to remove the image when first notified of the alleged infringement.

Once you look at the figures, it is clear why everyone concerned would not want this to go to court. Taking the standard Alamy licence fee of £40, even if that was an annual fee and you had been using the image for 2 years, the amount of damages would £80. Alamy would normally receive 20% and I imagine PM's terms will be around 40% of whatever is recovered, which means the photographer would only get back £32 plus his court fees, travel and lost earnings for the day, that is to say a net profit of £32. No one in their right mind would go through all that hassle. You on the other hand would probably have to pay out around the same amount as is being claimed currently, ie £80 damages, say £50-75 court fees, say £70 for the claimant's travel and perhaps £200 for his lost earnings. From this you can see that you have a strong hand when it comes to negotiating a settlement. I can't help you with the details of arriving at a settlement as I am not your solicitor and I cannot carry out due diligence via an internet forum, but I think you have enough guidance to come to an equitable solution.

My comment about the Companies House entry related to the fact that the three current and past directors of PM are all resident in Belgium, and in 2020 the Registrar commenced strike-off action against the company although this was then discontinued. This indicates some irregularity in the filing of accounts or some other mandatory notification. As I say, not really relevant to the main issue.

[danieleros]

Thanks for the detailed reply, this is very useful and your knowledge on the subject is very impressive.

[Nick Cooper]

The Companies House listing for Permission Machine makes interesting reading.

The accounts certainly are.

[Tomtom66]

Just received the very same email and details, going to tell them to go ahead with the solicitors

[CherryPieMonster]

Hmm. I recently got the same email, very similar backstory details. Proposed settlement was initially £420, later reduced by 25% to £315.

@Tomtom66, @danieleros - would love an update from you guys if you have one?

[Ant123]

Hi, I have received the same and same figures. I have yet to respond but the 21 days are up to pay. I have contacted several solicitors but non seeming want to help for such small fees. I am going to ask for the model release and property forms and also the photographers details.

[roger.t]

Hi, I have received the same and same figures. I have yet to respond but the 21 days are up to pay. I have contacted several solicitors but non seeming want to help for such small fees. I am going to ask for the model release and property forms and also the photographers details.

any progress?

[AndyJ]

Hi roger,
Nice try, but getting a licence after the event would be rather like slowing down after a speed camera had flashed at your car! Technically speaking because infringing copyright is a matter of strict liablity, that is to say, your intentions or the fact that you were unaware that you were infringing do not count as a defence, so you only need to carry out the act of copying for a claim of copyright infringement to become a realistic prospect. Only a fleeting and obviously temporary act of copying (such as the caching of an image on a device/computer in order to display it on a screen) would escape such liability (see section 28A Copyright Designs and Patents Act 1988).

[roger.t]

Hi, I have received the same and same figures. I have yet to respond but the 21 days are up to pay. I have contacted several solicitors but non seeming want to help for such small fees. I am going to ask for the model release and property forms and also the photographers details.

any progress?

[AndyJ]

Hi roger,

Yes, you really ought to ask for a breakdown. It might be worth pointing out to them when you ask for the breakdown that you are aware that if they choose to taken the matter to court and you defended the claim, the most the photographer could expect by way of damages would be the Alamy fee (which represents the current market value of a licence), and that the only other costs which might be awarded would be strictly limitted to the court fees (which only arise if the claim was lodged with the court) and the copyright owner's personal expenses on the day of the hearing* (travel, loss of earnings). No legal fees would be awarded against you. (see section 8 of the IPEC Small Claims Guidance Notes).

Therefore if their detailed invoice contained additional fees or costs which wouldn't be recoverable by going to court, you will be able to weigh up the pros and cons of settling the matter without going to court, as opposed to taking your chances in court and paying the Alamy fee as damages. And obviously Permission Machine will be doing the same sums, and will hopefully come to the conclusion that they need to settle for a more realistic figure, say the Alamy fee plus about 10% to cover their administrative expenses - about £40 in total.

* Currently, due COVID restrictions the court is trying to deal with as many simple case as possible without the need for a hearing in court, usually by holding a case management conference by phone or Zoom, and then dealing with the matter on the paperwork submitted by the parties.

[roger.t]

Thx