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Stop, deep! How to Win Big in a Copyright Infringement Case

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It’s heartbreaking to find your artwork on a t-shirt on Forever 21 or as an image on someone’s blog without your permission. Theft of your intellectual property, also known as infringement, is not that different from any theft of your property, except that you cannot go to the police to help you get justice.

Unfortunately, asserting your rights and receiving adequate compensation for the infringement often becomes your responsibility in the form of filing a lawsuit, which can be time consuming. Even worse? It often costs more money in legal fees than what you would receive from winning the lawsuit.

As a way to solve this conundrum, the US Congress included a “statutory damages” provision in the Copyright Act to ensure that artists receive guaranteed compensation for infringement, in addition to making any case of infringement easier and faster to litigate.

What are statutory damages and how can you get them if your artwork is used without your permission? Let’s find out.

What qualifies as infringement of a work of art?

Before you can bring any action against a party who has used your artwork without permission, they must have violated your copyright. So let’s first review what copyright protects and when and how that protection goes into effect.

Your creative work receives copyright protection as soon as your creative idea is “fixed in a tangible medium.” That means ideas are not protected, only the physical expression of that idea. A painting, a sketch on a napkin, or even a photo displayed on an iPhone are all physical media that are subject to copyright protection.

The copyright holder (usually the creator, but can also be a company or other entity) has the exclusive right to make copies, publicly display, distribute, and create derivative works of the artwork. Any person or entity that violates these rights is an infringer and is subject to legal action. More importantly, copyright is a no-fault law, so it doesn’t matter why or how the violation occurred. If the rights of the copyright holder are violated, it is an infringement. Period.

The idea is to encourage a self-enforcement mechanism where people and entities check to make sure the images they use have the necessary permissions. If they don’t, they can pay much more through a lawsuit against you.

Here is an example to illustrate the concept.

Let’s say Jack takes his artwork from his personal website and uploads it to a website he created called Stock Art Online, where he sells all of his stolen digital art for some extra cash. Jill is looking for an image to use in her blog post and finds her artwork on Stock Art Online. She then buys it and makes it the featured image for her blog post.

Obviously, Jack, who intentionally copied, then publicly displayed the artwork on his site, and distributed the artwork to Jill, is guilty of infringement. But, Jill is also guilty of infringing for displaying her artwork on her blog. It doesn’t matter that she legally purchased the artwork and didn’t know it was stolen. She is a violator and is subject to legal action just like Jack.

Due to the no-fault aspect of copyright law, most infringement cases revolve not around whether there was an infringement, but rather how much money the copyright holder should receive for the infringement.

Copyright registration is like having art insurance

Since there is no agency, such as the police or the FBI, that enforces copyright violations, it is up to the copyright owner to enforce their rights through a lawsuit or other legal action.

Unfortunately, the high cost of a lawsuit often makes it more expensive to sue the infringer than the damages the copyright holder in the lawsuit receives. Statutory damages alleviate this problem. To understand how statutory damages work, let’s look at what happens in a traditional non-statutory damages lawsuit.

How does a traditional infringement lawsuit work?

In a traditional infringement lawsuit with non-statutory damages, the copyright owner can win:

actual damage PLUS a percentage of profits What are they attributed to the offence.

Actual damages represent money that would have been received if the artist had sold or licensed it to the infringer. To illustrate this concept, let’s continue with the breach scenario discussed above.

Suppose you are suing Jill for the use of her artwork on her blog. Her work license fee for a blog is $400, so the real damage is the loss of that license fee. The fact that you never authorized the work for Jill’s blog or that she never paid $400 for it is irrelevant.

The percentage of the profit can be much more complicated to calculate. Again, let’s use our previous scenario.

Jill’s site requires a paid membership, from which she earns $1,000 per month. Her artwork has been on her site for exactly one month and that blog post generated 10% of all views that month. The blog article is worth 10% of $1,000 or $100.

Through various calculations, the court has determined that 25% of the people who viewed the article got there because they liked the image they saw, while the other 75% clicked on the article because of the title and content. So, of the $100 value attributed to the item, only $25 is attributable to its artwork.

Worse yet, from the $25, Jill can deduct a portion of her business expenses, such as web hosting fees, marketing expenses, rent, and more.

In the end, you may only be entitled to a maximum award for non-statutory damages of around $420. Since any lawsuit will cost more than $5,000 plus all of your time and effort, it is clearly not worth asserting your rights.

The result is that Jill is not penalized and you receive nothing for the violation. In fact, Jill is likely to continue to use the image, as it’s unlikely she’ll ever have a high enough damage value to make legal action worthwhile.

What are statutory damages and how can I get them?

The problem of costs outweighing potential return in an infringement lawsuit is very common. Congress created the statutory damages provision of the Copyright Act to alleviate that problem.

However, statutory damages are only available if you file a copyright registration for the work with the US Copyright Office:

    • before the offense occurred, or
    • the record must have been submitted within three months of publication (see here for information on what constitutes a publication).

Copyright registration is easy to do using the Registration Portal of the Copyright Office. It costs $45 to register a single work, such as a painting or drawing, or $55 for a group of up to 750 photos by the same photographer in the same calendar year. (For more information on copyright registration, see Planning the copyright registration process).

If the copyright registration requirements are met, the copyright owner has the right to:

    • a minimum of $750 to a maximum of $30,000 per violation.
    • up to $150,000 per violation if proven willful or intentional.
    • reasonable legal fees for the winning party.

Let’s look again at our earlier scenario with Jack and Jill.

Statutory damages would require Jill to pay at least $750 for her violation. The copyright holder is not required to provide proof of damages or profits; However, the court will consider it or other evidence to determine where in the $750-$30,000 range the damages should fall.

Jill didn’t get much profit from the infringement and you, as the copyright holder, didn’t lose much money, so the prize is likely to be on the lower end of the scale, like $1,500.

You can get even more money if you can show that the infringer knew they were infringing on your copyright.

In our scenario, it appears that Jack intentionally and knowingly stole his work. However, proving someone’s state of mind without physical evidence can be difficult and requires mental experts, statements from their friends and family, or analysis of their emails and computers.

While the damages award from Jill’s lawsuit may not seem like enough to justify the costs of the lawsuit, and Jack’s lawsuit could be very expensive because of the required witnesses and analysis, Congress fixed that problem, too.

The Copyright Act also has a provision that allows the loser to pay the legal fees of the winner of the lawsuit. The provision of legal fees not only saves you money, but also makes the entire litigation process easier and simpler.

First, most attorneys will take the case on a “contingency” basis. That means you won’t have to pay legal fees up front. The lawyer will collect the fees at the end when the damage award is received.

Also, if the offender knows that for every hour he defends, he has to pay his legal fees, he is more likely to settle the case early rather than drag it out, thus getting money in his pocket faster.

__________

The advantages of registering your work with the US Copyright Office so that you can receive legal damages in an infringement case are clear. Copyright registration is like insurance. For a small fee, you can be sure that you can enforce your copyright. Copyright registration will make most infringement lawsuits economically feasible, where they may not have been before. More importantly, most intellectual property attorneys will take an infringement case with statutory damages on a contingency basis so you don’t have to pay legal fees up front. All you need to do is register your artwork.

Do you register your works for copyright protection? Let us know in the comments below.

steve schlackmann

steve schlackmann

As a photographer and patent attorney with a marketing background, Steve has a unique perspective on art, law and business. He currently serves as Product Director at Artrepreneur. He can find his photograph at artrepreneur.com or through the Fremin Gallery in New York.

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