Determining the settlement fee is the most difficult part of pursuing copyright infringements. You don’t want to leave money on the table, yet you don’t want to charge so much that the infringer simply tosses your letter in the garbage. This chapter of Photo Repo helps you find the sweet spot: a fee just large enough to where the infringer doesn’t try to fight and decides paying is a better choice than risking further financial and legal trouble. Topics include:
- How Much Can an Infringer Afford to Pay
- Pre-Registration Infringements
- Copyright Notices and Intent
- Use of the Photograph
- Determining the Settlement Fee
- Business Liability Insurance
- Multiple Infringements
- The Purpose of Lawsuits
CHAPTER EXCERPT | ON DETERMINING HOW MUCH AN INFRINGER CAN AFFORD TO PAY…
Online businesses present a problem all their own because a person working out of his parent’s basement can have a website that makes him look like the owner of a Fortune 500 company. Therefore, it is often better to consider industries and location rather than individual businesses when it comes to determining your asking price. A hair salon in a small town is probably not as profitable as one on Fifth Avenue in Manhattan. An engineering firm, regardless of location, is most likely a profitable business. Other industries can be tough to figure. A real estate agent may be making a lot of money, or he may be just starting out and using his savings to stay afloat. However, his website will never reflect anything but prosperity.
If you find an infringing company and have no idea of its size, a little research might shed some light on the matter. Do an Internet search for something like “revenue of XYZ Company,” for there are online businesses that report (or estimate) corporate earnings. Also look for articles about the company. I came across an infringer I had never heard of, but after searching the company name I found a Forbes article that reported the company took in over $3 million a year and was expanding into four major cities. Based on this information, I increased my typical demand from $495 to $1,000 (we ended up settling for $750).
Another way to judge a company’s size is by an estimate of its web traffic. Similar Web (similarweb.com) provides this information along with estimated United States and worldwide rankings (small websites do not return any results). Of course, this information is only relevant if you have a known website to compare it with. Run an inquiry on your own website and a few popular sites to get your bearings, then compare the infringer’s site to these results. Of the forty-nine pursuable infringers I recently found, only thirteen had greater estimated traffic than my own website (40,000/month—not the Photo Repo site). Six of these were news media sites, one was a government site, and the others were sites that did business nationwide. No blog or small business websites returned any results.
CHAPTER EXCERPT | ON EDITORIAL USES OF INFRINGED PHOTOGRAPHS…
Due to the proliferation of bloggers, webzines, and online news agencies, unauthorized uses of your photographs for editorial purposes are just as common as for commercial purposes. Because editorial licensing fees are typically much lower than commercial fees, you may be tempted to base your asking price on this value discrepancy. However, determining a settlement fee for editorial uses requires a careful analysis of the infringement because editorial writing can be commercial in nature. For example, a vacation property rental firm that writes an article about things to do in Pensacola, Florida, is only doing so to promote its vacation properties in Pensacola. Real estate agents, hotels, and property managers do this all the time, and you should consider such writing to be commercial when determining your settlement fee. Likewise, a blogger may be writing product reviews that appear to be completely objective, but he may also be making a commission on sales through an affiliate program. On the other hand, a car dealer who has a Things To Do In Timbuktu page on his website is just trying to be helpful. Nobody is going to buy a car from the dealer just because he provided a few tips on where to go when visiting his town.
CHAPTER EXCERPT | ON LAWSUITS…
Throughout this book I have stated that I have no plans for my copyright infringement cases to end up in court, and that copyright infringement cases involving photographs used on a website without permission are highly unlikely to end up in court. This does not mean that lawsuits won’t be filed, they just don’t end up going to trial. These types of infringements are almost always commercial in nature, and the infringer clearly does not have permission to use them. Therefore, the infringer is not protesting his innocence and demanding his day in court, and he is not going to spend further time and money on the matter. Attorneys file lawsuits in these cases simply to get non-responsive infringers with assets to come to the table and negotiate. As a result, the lawsuits are either resolved through an out-of-court settlement, or the defendant simply ignores the lawsuit and the copyright holder ends up with a default judgment. My IP attorney has filed two lawsuits in my name. What happened? In the first case, the infringer never responded and the attorney filed for a default judgment, which was granted. My attorney put a lien of the company’s property, so one day many years from now I might get a check in the mail…provided the company isn’t selling its property because it went bankrupt. The second is ongoing, but the infringer did respond, so hopefully this will be settled.