Did you receive a letter accusing you of copyright infringement? Here is what you need to know.

It is so easy to share and use content online, some companies inadvertently get themselves into trouble—especially when it comes to photographs, including memes. There is a cottage industry of (purported) copyright owners who use one of the many publicly available reverse photo lookup tools to find unauthorized uses of their photography. Some call them copyright trolls, but I will not use that term here.

Over the years, I have counseled many businesses and individuals that have received letters from these copyright owners accusing them of infringement, demanding substantial sums of money, and threatening legal action. Understanding how to assess these claims can help guide you on how to respond. It can also help you avoid this kind of issue from arising in the future.

Assessing the Likelihood of a Lawsuit

The first thing I do when a client comes to me with a letter like this is to assess how likely it is that the copyright owner will file a lawsuit. The actual damages suffered by the copyright owner are almost always extremely low, but lawsuits are expensive and should be avoided whenever possible. Here are key factors I consider:

1. Copyright Registration Status
   • Pre-Infringement Registration: If the copyright owner registered the photograph before the alleged infringement began, they are eligible to seek statutory damages and attorney’s fees under the Copyright Act. This significantly increases the financial risk for the alleged infringer because statutory damages and attorney’s fees can be assessed at a rate that is far higher than the actual damages, which drastically changes the economics of filing a lawsuit from the perspective of a copyright owner.
   • Post-Infringement or No Registration: If the copyright was not registered before the infringement, the owner is limited to actual damages and cannot recover attorney’s fees or statutory damages. This limitation often makes litigation less economically viable for the copyright owner.
   • Red Flags: If the copyright owner refuses to provide a copy of the registration certificate, it usually indicates that the copyright is not registered or was registered after the alleged infringement began.
2. Litigation History of the Copyright Owner
   • Past Legal Actions: A copyright owner with a history of filing infringement lawsuits is more likely to litigate new claims. Take letters sent from these serial copyright plaintiffs very seriously. Reviewing their litigation history can provide insight into their willingness to pursue legal action.
   • No Prior Lawsuits: While a lack of previous lawsuits does not guarantee they will not sue, it may suggest a lower likelihood of litigation, depending on the other circumstances present.
3. Fair Use Considerations
   • Warning: It is extremely difficult to prove “fair use” of copyrighted material. It is a fact intensive inquiry that would almost certainly be decided in the alleged infringer’s favor near the end of a copyright lawsuit after a pile of attorney’s fees have been spent on litigation, with limited ability to recover them from the copyright owner.
   • Non-Profit/Educational: I have worked with a few non-profit clients who have successfully used a fair use argument to either defeat a copyright claim or negotiate a lower settlement amount. Again, though, solid fair use claims are extremely rare.

The Risks of Unauthorized Image Use

Unauthorized use of images, even in seemingly minor instances, can lead to significant legal troubles. This is true even when a marketing agency or designer provided you with marketing materials that include photos that they did not license.

• Cases in Point: I know of one company that used a photo in a social media post that garnered a few hundred views. Despite the minimal exposure, they became embroiled in a copyright infringement lawsuit lasting over a year. The plaintiff likely pursued the case so aggressively anticipating recovery of statutory damages and attorney’s fees, despite low actual damages. So, even a post to your blog that “nobody reads” can trigger a lawsuit.
• Personal Liability: One aspect of copyright law that I have found is not widely known is that the individuals who were directly involved in the alleged infringement can be sued personally. The law does not shield officers, directors, or employees who are actively involved in the alleged infringement, exposing them to potential personal liability.

Protecting Yourself and Your Business

• Obtain Proper Licenses: Always ensure you have the necessary rights or licenses to use photographs or other copyrighted material on your website and social media pages. If you use an agency, make sure your contract obligates them to obtain licenses for all the images they use in your marketing materials. Getting proof of the license is even better, as it will allow you to efficiently respond to any allegation that you do not have a license. This proactive approach is the best defense against infringement claims.
• Consult Legal Counsel: If you receive a demand letter or are unsure about the legality of your content use, seek legal advice to understand your rights and obligations.
• Review Insurance Policies: Some business insurance policies include coverages that may include copyright infringement claims. One example of this is so-called “advertising injury” coverage. Reviewing your policies can help mitigate financial risks associated with potential lawsuits.

Receiving one of these nasty letters threatening you with hundreds of thousands of dollars in damages can be daunting, but understanding the key factors that influence the likelihood of litigation can help you make informed decisions. Always exercise caution when using third-party content, and do not hesitate to seek professional guidance from an attorney to protect your interests.