The following scenario is all too common for those who post content on the web. Imagine you create a website that, unbeknownst to you, includes some form of work (say, a photograph) that is copyrighted to someone else. Perhaps you copied the photo from another website where it was freely available. Perhaps an employee posted it without thinking of asking for permission or a license. It may have been accidental, but regardless, you may have committed copyright infringement.

Months or even years later, you receive a cease and desist letter from a lawyer representing the copyright owner. You immediately apologize and take the content down. Hardly anyone accessed the content anyway, and advertising revenue on the page was negligible. What's more, you find out that the copyright owner licenses the work for just a few dollars, and sometimes even for free. You offer to pay double or triple that amount to make the problem go away. But the copyright owner threatens a lawsuit unless you pay an exorbitant $150,000—the maximum amount of statutory damages for "willful" infringement under the Copyright Act—which is tens of thousands more than what it would have cost to simply license the work.

You may have committed copyright infringement. Do you pay the amount demanded, try to negotiate a lesser amount, or stand your ground and fight in court?

A Cautionary Tale: Golden v. Michael Grecco Productions

That's what happened in Golden v. Michael Grecco Productions, a federal copyright lawsuit in the Eastern District of New York. In July 2015, Lee Golden authored a blog post on his pop culture website about a rumored reboot of the 1990s television series Xena: Warrior Princess. The post included an image of actress Lucy Lawless as Xena, which was taken by photographer Michael Grecco. By all accounts the photo had little to no value. The blogger made no money from his post. The photographer licensed the photo less than a dozen times from 2010 to 2013 for a total of just $3.94 in revenue, and not once since 2013. He didn't even notice his photo was on the blog until over three years later. The infringement caused little to no damage.

In February 2019 the photographer's lawyer sent a cease and desist letter to the blogger warning that he was liable for up to $150,000 in damages, but that the photographer would accept $25,000 to settle—still over 6,000 times the total amount he had ever licensed for the photo.

The blogger said no, and then filed a lawsuit in May 2019 for a declaration that his use of the photo was "fair use" under the Copyright Act. The photographer counterclaimed for infringement, seeking up to $150,000 in statutory damages. After nearly two years of litigation, the district court found that the blogger did commit copyright infringement, and that his blog post was not fair use. But the court awarded the photographer just $750 in damages—the minimal amount of statutory damages available for ordinary (i.e., non-willful, but non-innocent) infringement. That's far more than what the photo would have commanded in licensing fees, but far less than what either party undoubtedly paid in legal fees. There were no winners.

Guidance

What should website operators do in this familiar scenario? Pay thousands of dollars for infringing a work that would have cost just a few dollars to use? Or stand their ground and fight it out in court?

The most important thing to know is the amount of damages that a copyright owner can obtain in a lawsuit. A plaintiff must choose between "actual" damages and profits—which in this scenario is typically negligible—or "statutory" damages. Statutory damages ordinarily range from $750 to $30,000 per each infringed work. If the plaintiff proves that the infringement was committed "willfully" the court can award up to $150,000 per work. If the defendant proves that the infringement was "innocent," the court can lower the award to as little as $200 per work. In the vast majority of cases damages will be awarded somewhere in the standard range, and in the case of works with minimal value, at the lower end. Also, statutory damages are only available for registered works, so if the copyright owner never properly registered with the U.S. Copyright Office, he or she will need to prove actual harm.

If you face this scenario, consider the risks and benefits of litigating versus settling for a reasonable amount. At minimum, you will want to know:

• Was the work registered?
• How much does the copyright owner typically charge in licensing fees?
• How much have you made, if anything, by using the work?
• Is the lawyer or copyright owner a well-known copyright troll?

Navigating these issues is tricky, but we have the experience to manage them. If you receive a cease and desist letter, seek advice on best practices to help prevent accidental or innocent copyright infringement.