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Linking to Copyrighted Content: Not a Foolproof Way of Avoiding Infringement Liability

There is a common misperception that “linking” to copyrighted content on other webpages, instead of simply copying and pasting an image, for example, is a foolproof way of avoiding liability for copyright infringement. However, students, internet users, and startups without experience in the field of copyright should be aware that this is not always true.

The Berkman Center for Internet and Society’s Digital Media Law Project splits the practice of “linking” into two categories — “deep linking” and “inline linking.” “Deep linking” refers to “placing a link on your site that leads to a particular page within another site (i.e., other than its home page).” The ABA’s Intellectual Property Litigation states that “a majority of courts have agreed that merely linking to another site (whether in the form of a simple link to another website’s homepage or a deep link to a specific page on another website) does not constitute copyright infringement.” The ABA bases this conclusion on the clear statement made by the Federal District Court for the Central District of California in Ticketmaster v. Tickets.com that “hyperlinking does not itself involve a direct violation of the Copyright Act (whatever it may do for other claims) since no copying is involved.” The Electronic Frontier Foundation’s Internet Law Treatise also cites Arista Records, Inc. v. MP3Board, Inc. (holding that linking to content does not implicate distribution rights and thus, does not give rise to liability for direct copyright infringement), and Online Policy Group v. Diebold, Inc. (holding that “hyperlinking per se does not constitute direct copyright infringement because there is no copying”) to support the conclusion that mere linking does not violate the Copyright Act.

The Berkman Center defines “inline linking” as “placing a line of HTML on your site so that your webpage displays content directly from another site” commonly referred to as “embedding.” The Berkman Center relies on Perfect 10. v. Google in concluding that “while there is some uncertainty on this point, the Ninth Circuit concluded that inline linking does not directly infringe copyright because no copy is made on the site providing the link; the link is just HTML code pointing to the image or other material.” Rightfully so, the Berkman Center cautions that other courts may or may not follow this reasoning.

If you are feeling that the above analysis seems unsettlingly inconclusive, your uneasiness is well warranted. The Berkman Center points out that there still may be liability for linking: when either 1) the linking is to infringing works, or 2) the linking is to circumventing technology proscribed by the Digital Millennium Copyright Act (DMCA). The first circumstance arises when you knowingly link to works that clearly infringe someone’s copyright, “such as pirated music files or video clips of commercially distributed movies and music videos.” Such linking may give rise to a specific kind of secondary liability called “inducement,” which occurs by “intentionally inducing or encouraging direct infringement.” Metro-Goldwyn-Mayer Studios, Inc. v. Grokster, Ltd., (holding that one who distributed a device with the object of promoting its use to infringe copyright, as shown by clear expression or other affirmative steps taken to foster infringement, is liable for the resulting acts of infringement by third parties). The Berkman Center instructs that “as long as you do not know that a work infringes someone’s copyright, then you cannot be held liable for contributory infringement for directing users to that work.” However, “on the other hand, it is not necessarily safe to simply claim that you ‘didn’t know’ when the circumstances make it clear the material you link to is infringing.” The Berkman Center also suggests that you may be able to avoid liability in these circumstances by following the notice and take down procedures of the DMCA.

The second circumstance pertains to §1201 of the DMCA, which makes it illegal to traffic in technology that enables others to circumvent technological measures put in place by copyright holders to control access to or uses of their copyrighted works. Trafficking is defined as “making, selling, giving away, or otherwise offering” these devices or tools to the public. Simply posting such tools to your website (which can consist of merely reposting a combination of numbers and letters that you know represent a circumventing code) or linking to other websites that host them qualifies as trafficking, as described in Universal City Studios, Inc. v. Corley, (holding that hosting and linking to the DeCSS code, which allowed users to circumvent CSS, the encryption technology used by movie studios to stop unlicensed playing and copying of commercially distributed DVDs, violated the DMCA’s anti-trafficking provisions, and this application of the DMCA did not violate the First Amendment).

In light of this analysis, it is clear that simply linking to copyrighted content on other webpages, instead of copying that content directly onto your webpage, is not a foolproof way of avoiding liability for copyright infringement. An experienced copyright attorney, or established company with in-house counsel, will likely be sufficiently knowledgeable and savvy to recognize, and avoid linking to, content from webpages that is clearly infringing or has circumventing instructions in violation of the DMCA. However, students, internet users, and startups who are not as savvy, or do not have in-house counsel, may be happy to knowingly deep link or inline link to a clearly infringing photograph, video, or song, and thus should be on notice that such behavior may subject them to copyright infringement liability.

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The Dangers of Copying Terms of Service and How to Avoid Them

It might be tempting to copy the Terms of Use from another website, but should you? Attribution: Cathy Olson.

It might be tempting to copy the Terms of Use from another website, but should you? Attribution: Cathy Olson.

Facebook has 1.55 billion users, and each of them has a contract with the company. At their scale, there are few documents more important than their Terms of Service (ToS). Understandably, many Internet entrepreneurs are and should be concerned about this critical part of their business, even if they don’t have the same reach as the Facebooks of the world. Unfortunately, many resort to simply reproducing an existing ToS from a comparable company, but such copying can be risky, in addition to painting companies as cheap knock-offs of their competitors.

Sometimes, another company’s ToS will be very attractive because it contains specific provisions that are relevant to your company as well. If you’ve built an application that tracks your users’ location, then it will be very tempting to copy Uber’s ToS, for example (or large parts of it). But would doing that be in the best interest of your company? Further, would it even be lawful?

Leaving You Vulnerable

The most significant downside of copying a ToS is that it will not contain the provisions tailored to your particular business. If a user or customer were to take legal action against your company, you would be missing the language that could make all the difference in settling or winning the dispute.

Competitors may be using a surprisingly different process to provide similar services. For example, if you’re providing a service based on wireless communication protocols, your competitor might be operating with a different technology, and the provisions of their ToS will very likely reflect that. There might be clauses arising specifically from the technology used, such as the reliability of connectivity, say over the RFID protocol (radio-frequency identification), that are irrelevant to your company, which might be using the NFC protocol (near-field communication). If for whatever reason a dispute arises that implicates the reliability clause, having a custom-tailored ToS is essential.

Governing Law

A ToS can in fact be protected by copyright, and entrepreneurs and their lawyers should take heed. At least one court has found a company liable for copyright infringement when they have copied important sections of public-facing contracts used by competitors.  In AFLAC of Columbus v. Assurant, Inc. et al (2006), a federal district court in Atlanta found that the non-boilerplate sections of AFLAC’s insurance policies were protected by copyright, and that competitors in the insurance market would be liable for infringement if a court found substantial copying. Since an insurance policy is a contract like any other, the same logic would hold for a ToS.

It may come as a surprise, since any practicing lawyer knows that the building blocks of most contracts are copied from others, but contracts that are sufficiently original and creative may be entitled to copyright protection. Accordingly, a contract containing many commonly used provisions can still be protected by copyright because the particular arrangement of provisions could constitute an “original” (and thus copyrighted) compilation.

Practical Risks

The risk of being sued for copyright infringement is small. However, there is a non-legal risk of others viewing the product or service as derivative and unoriginal, making competitors look like the first-mover and innovator in the relevant market. This is especially true for more sophisticated readers of the agreement, such as strategic customers or investors, who may look at the ToS more closely. This obviously doesn’t apply to the standard boilerplate provisions that can be found in almost all contracts, such as a force majeure clause, but in the areas of the Terms that are unique to that particular business, it will look bad.

Open Source Contracts

On the other hand, some companies have generously made their ToS available for the public to use, so long as they provide attribution. Automattic, the company behind the popular WordPress.com, recently open sourced their ToS (in the spirit of their own open source software). They’ve made it available under a Creative Commons Sharealike license, which enables others to copy and repurpose the document so long as internal references are relabeled and attribution is given to WordPress.com.

In conclusion, if you’re tempted to copy another company’s ToS, you may be infringing on their copyright if you take provisions that are unique or distinct from industry custom. If instead you copy just boilerplate or commonly accepted industry provisions, you should be in the clear.

The question then is, if you’re a lawyer, or even an entrepreneur who’s not afraid to draft a ToS, how should you draft solid language that is not a direct rip-off of your competitor’s? See Part 2 of our ToS series to find out!

Part 2: Drafting a Unique and Effective Terms of Service

Lawyers have an ethical obligation to provide fundamentally sound legal advice to their clients. This advice often includes work product that is memorialized, and in the case of a ToS, publicly displayed. This presents an interesting issue: How can the new ToS be distinguished from the original without sacrificing the client’s objective of superior work product? The original document  might be legally sound, comprehensive, well-organized, and narrowly tailored to your market. Yet, completely plagiarizing an existing document has ethical implications, as well as the issue of outside perception mentioned above.

To that end, it’s advisable to start with a series of strong sample documents from sources like CooleyGo, UpCounsel, or Docracy. These are released into the public domain and thus present no copyright concerns.

One process used at our Clinic allows practitioners to create effective ToS documents without plagiarizing. You begin by finding several samples. We found it helpful to begin with documents from the most successful technology companies. By comparing the ToS’s of Apple, Facebook, Google, Uber, and others, we were able to more readily identify boilerplate language common to software and Internet companies. We were able to identify how these companies dealt with specific risks, like server failure, data breach, and personal injury.

Armed with the knowledge of how the biggest and best tech companies minimize risk, we then looked for smaller companies that were in the same field as our clients and had more relevant language to reference. We identified the sections of these ToS’s that were not boilerplate and we stripped them of their legalese. Once we had a version in entirely laymen’s terms, we then translated back to legalese using our own verbiage and adding our own relevant language. This created an authentic ToS that was tailored perfectly to our client’s business.

Other Information

For other information on this topic:

http://newsroom.fb.com/company-info/

http://pub.bna.com/ptcj/1051462Jan11.pdf

https://www.quora.com/Does-copyright-apply-to-contracts

http://scholarship.law.umassd.edu/cgi/viewcontent.cgi?article=1083&context=fac_pubs

http://www.law360.com/articles/5247/insurance-policies-can-be-copyrighted-judge-rules

http://www.americanbar.org/groups/professional_responsibility/publications/model_rules_of_professional_conduct/model_rules_of_professional_conduct_preamble_scope.html

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Early Engagement: How Working with Your Attorney Can Help Steer Your Startup

Consulting an experienced attorney should be part of your business model validation.

Consulting an experienced attorney should be part of your business model validation.

Entrepreneurs may not exactly relish the thought of technological deep-dives with their attorney; in fact, we’ve heard more than a few complain that any time with an attorney would be better spent focused on the real work required to launch the entrepreneur’s business. But the truth is that early engagement with trusted counsel can be a crucial step in the development of a startup’s business model or underlying technology. Startups often operate in complicated spaces, with a host of potential issues involving regulatory requirements, entity formation, and intellectual property law. If a startup is far along in its development, it may be too late for an attorney to be able to advise the startup on how to avoid fundamental legal issues, which could jeopardize the startup’s chance of success. Early engagement with counsel allows the attorney to offer advice in the initial stages of the development pipeline, and puts the entrepreneur in the position of understanding the current state of the law while he is still able to tailor the startup’s business and technology plan accordingly.

Concerning intellectual property, it’s not uncommon for an entrepreneur to hire an attorney to perform a preliminary patent or trademark freedom to operate analysis, which helps the entrepreneur learn whether he needs to design around another’s IP before the costs of changing course are great. This blog post will focus on two recent examples of companies who encountered copyright law issues, and discusses how early legal counsel might have affected business decisions.

Aereo – delivering television over the internet, privately

Aereo is an Internet-based service that allows subscribers to watch broadcast television, either live or previously recorded, on nearly any Internet-connected device. For a low monthly-fee, subscribers can ditch their over-the-air antenna, enjoy the convenience of DVR functionality, and untether from their television. Because of the risk this model poses to the advertising revenue that supports over-the-air television, broadcasters and television content producers are not pleased. Perhaps unsurprisingly, a group of broadcasters sued Aereo for violating their public performance right under Section 106(4) of the Copyright Act.

In July 2012 the Southern District of New York denied a preliminary injunction against Aereo, and in April 2013 the U.S. Court of Appeals for the Second Circuit affirmed the denial. Finding that Aereo’s service does not constitute a public performance, the Second Circuit held that the broadcasters were unlikely to prevail on the merits. The Second Circuit relied in large part on its earlier decision, Cartoon Network, LP v. CSC Holdings, Inc. (“Cablevision”), which had held in part that the “public” of “public performance” should be determined based on the potential audience for a particular transmission, and that as a result the playback of an individual’s copy of a DVR recording, recorded by and only for that individual, did not constitute a public performance.

The fascinating thing about Aereo’s technology is how squarely it fits within the carve-out of what is public, as set by Cablevision. Aereo utilizes many tiny antennas, each as small as the tip of a finger, to deliver content. When a subscriber is watching a live broadcast on Aereo, an individual antenna is assigned to that subscriber, and only that subscriber receives the transmission from that antenna. When a subscriber sets a program to be recorded in advance, an antenna is assigned to receive the program for just that subscriber, and the program is recorded to storage accessible only to that subscriber. Like the DVRs of Cablevision, the streaming service of Aereo cannot be considered public given the private (individual) nature of the potential audience. In fact the technology matches so closely to what was allowed by the court in Cablevision, it almost looks as if someone took the Cablevision ruling and used it as a roadmap of what Aereo should be permitted to do. It’s hard to imagine that the private nature of Aereo’s transmission and recording infrastructure was merely coincidence. Granted, we don’t know whether such advice was made by counsel. But Aereo nonetheless demonstrates the benefits of: (i) understanding the state of the law; and (ii) applying that legal understanding in developing your technology. In contrast, when a startup relies on technology that runs counter to the law, as discussed below, it can be a difficult misstep to recover from.

ReDigi – when a re-sale is not protected by a first sale

ReDigi seeks to be an online marketplace of pre-owned digital goods, where users can buy from and sell to other users. Currently ReDigi only supports the resale of digital music. In the initial rollout (referred to as ReDigi 1.0), once a user offers a song for sale, that user’s copy of the song is transferred from the user’s computer to ReDigi servers. When the song is purchased, the song is transferred from the ReDigi server to the purchaser’s computer.

In 2012, the record label Capitol Records brought suit against ReDigi, alleging that ReDigi’s marketplace transfer necessarily created copies of the song offered for sale, and thus violated the record label’s exclusive reproduction right. In response, ReDigi argued that they were protected by the first-sale doctrine, which allows the owner of a copy of a work to sell that copy. In March 2013, the court granted Capitol Records partial summary judgment on the claims of infringement of the reproduction right, finding that the first-sale doctrine was limited to the sale of a physical copy and did not permit the reproduction undertaken by the ReDigi marketplace.

Compared to Aereo’s situation, where the technology comfortably fell within the contours of favorable case law, the legal arguments launched by ReDigi are not as strong. The plain reading of the first-sale doctrine shows that what is contemplated is the lawful sale of a single copy of an item (“owner of a particular copy”, sale of “that copy”); it is difficult to find a suggestion that the doctrine allows for reproduction in the course of a sale. It may have been the case, however, that first-sale was the strongest defense available once the marketplace technology was set.

It would be interesting to know how a better understanding of the copyright landscape, likely with assistance from an attorney, could have helped ReDigi. For example, could ReDigi have instead architected a marketplace that didn’t involve reproduction? Conceivably, resale could be achieved by performing initial purchases through ReDigi so that tracks are saved on their servers; in this way resale can be accomplished by transferring exclusive access to a file, as opposed to the file itself, from one ReDigi user to another. In fact, that appears to be just the approach used by ReDigi 2.0, which was exempt from the ruling in Capitol Records because it accomplishes resale without copying the offered file. Would ReDigi have implemented ReDigi 2.0 first and avoided litigation had it better understood the exclusive rights of copyright?

Conclusion

The two cases above demonstrate how a thorough knowledge of the law can significantly impact the early operation of a technology startup. Furthermore, the questions of law raised were not tangential to the operation of the businesses, nor were they necessarily solved by technological quick-fixes: the copyright questions were at the core of how both companies’ businesses operate.

As an entrepreneur preparing to launch a startup, what can you do? Find an attorney you can trust, preferably someone knowledgeable in the field in which you’re operating, and develop a relationship with that person. Bring them into the loop early as you begin to develop your startup’s business model or work on the technological solution to an as-yet-unsolved problem. These early conversations can help you tailor the direction your startup takes in order to best fit within the confines of the law. Furthermore, this early attorney engagement can fit in naturally with the sort of conversations you’re already having while preparing to launch your startup. While you’re in the process of validating your business model through talking to potential customers and partners, also take the time to have at least brief conversations with your attorney. In this way you can use this vetting process both to make sure your startup provides something customers want, as well as doing it in a way without running afoul of the law.

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How to Find Software Development for a Minimally Viable Product

 

Startups often find themselves in search of developers for their minimally viable prototype.

Startups often find themselves in search of developers for their minimally viable product.

A common issue for startups is where to find software development services to create a minimally viable product.  In lean startup methodology, a minimally viable product is a product with the minimal feature set needed to gauge customer needs.  Generally speaking, startups have three options if they do not already have a software developer on their team:

1.  Find a Technical Co-Founder – A startup may consider finding a software developer that would be a good fit to take the role of a technical co-founder.  This would typically require finding a software developer willing to make a full-time commitment to your startup.  Startups should also look for a good alignment of values, personality, and interests with a potential founder.  The trouble with this strategy is that it might take time to find, and become comfortable with, a suitable co-founder.  The diligence needed to find a co-founder may be inconsistent with a startup’s timing for developing a minimally viable product. The main benefit of having a co-founder capable of leading the development of a minimally viable product is that it is easy to make the necessary iterations to the product based on what a startup learns from its customers.  A technical co-founder is typically initially incentivized with founder’s equity, subject to a standard vesting arrangement.

2.  Use Independent Contractor Developers – If a startup does not have a technical co-founder, or if that co-founder needs additional assistance in creating a minimally viable product, a startup can often engage individual software developers through an independent contractor relationship.  These programmers should sign an independent contractor agreement or software development agreement with terms covering IP assignment, deliverables, and payment.  This relationship benefits the startup because it provides quick software development services for a minimally viable product, yet doesn’t commit the startup to a long-term relationship.  Also, because these independent contractors will be familiar with the startup’s technology, they may be available to tweak and improve the code based on customer feedback.  Independent contractors can be compensated with pay or with relatively small chunks of equity.  An additional benefit of this arrangement is that it could serve as a trial run for a potential technical co-founder.

3.  Use of Professional Software Development Providers – There are also companies that specialize in software development.  These companies range from high-end providers with extensive software development bandwidth and expertise.  These providers may take equity compensation from certain clients but will typically require monetary compensation in the ten’s of thousands of dollars. Smaller development firms may be less expensive or more willing to accept equity a full or partial compensation.  The drawback of using a development firm is it might be harder and more expensive to use that firm for the necessary iterations required after customer feedback.  Most firms will use their own developer-favorable agreement to cover the services they will provide, IP ownership, and payment terms.

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Copy-left or Copy-right? Either way, you can still get in trouble for selling someone else’s code

Robert Jacobsen was a model train enthusiast and a computer programmer. Combining these interests, he created DecoderPro, a software application for programming model trains. Jacobsen distributed the source code for DecoderPro online under an open source license. Another company, KAM industries, downloaded the DecoderPro source code and used parts of it to create another software application, calling the new application “Decoder Commander.” KAM industries then sold Decoder Commander to consumers.

This may seem like a familiar story in the software development world. In recent years, many developers have chosen to forgo traditional software licenses in favor of “copyleft” licenses, which allow licensees to use the copyrighted source code without charge, provided that certain conditions in the license are met. Given the plethora of open-source code that can do everything from run your computer to control complex databases, many entrepreneurs may find it tempting to copy freely available source code instead of programming from scratch. Doing so, however, may end up costing start-up companies more than they expect.

The Nature of Open-Source Licenses

Source code distributed under an open-source license may come with restrictions on its use.  The licensee must comply with the terms of the license, which may vary significantly. Common open-source licenses include the GNU General Purpose License (GPL), the Lesser General Purpose License (LGPL), the BSD License, and the Artistic License. The most widely used open-source license is the GPL, which is also one of the most onerous “copy-left” licenses.

Under the GPL, licensees may use and modify the copyrighted software, with the caveat that any modified versions of the software must be made available for third party use free of charge. In other words, if any portion of a software application contains open source code covered by the GPL, then the entire software must be freely available to the public. For this reason, the GPL is sometimes called a “viral license“.

Of course, not all open-source licenses are as onerous as the GPL license. Some impose minimal restraints on the licensee. For example, the BSD License only requires the licensee to include the BSD statement in modified software, and does not limit commercial redistribution of modified software.

Violating the Open-Source License

Returning to our model train story, the DecoderPro source code was distributed under the Artistic License, which allows re-distribution subject to specific conditions listed in the license. KAM Industries did not comply with the terms of the Artistic License, and removed the license terms from its new application, Decoder Commander. Jacobsen eventually sued KAM Industries for breaching the Artistic License. In Jacobsen v. Katzer, 535 F.3d 1373, the Federal Circuit sided with Jacobsen, and held KAM Industries liable for both copyright infringement and breach of contract.

The takeaway lesson is to be very careful about incorporating open-source code into your commercial product. In general:

  1. Make sure you understand the terms of the open-source license you are accepting.
  2. Document any code that you did not write yourself. If you have employees or contractors who are coding for your company, make sure that  your employees and contractors are not incorporating open-source code without your knowledge
  3. If you are making a commercial product, avoid open-source code distributed under viral licenses. Your company might be held liable for copyright infringement for making unauthorized copies of the code if you do not comply with the license, which typically requires giving your product away for free.

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H-E-L-L-O Copyright Lawsuit!


On 01/18/2013, freelance photographer Brian Masck filed a civil lawsuit in the U.S. District Court of the Eastern District of Michigan alleging copyright infringement of his photograph of Desmond Howard striking the Heisman pose in the 1991 Michigan versus Ohio State football game.  Named defendants in the suit include Desmond Howard himself, Sports Illustrated, Nissan North America, Getty Images, Inc., Champions Press, L.L.C., Fathead, Wal-mart, Amazon.com and Photo File.

Copyright, a form of intellectual property law, protects original works of authorship including literary, dramatic, musical and artistic works.  Copyright specifically grants creators of such original works exclusive rights to reproduce, display, perform, distribute copies or prepare derivative works based upon the copyrighted material (subject to some important rights granted to the public). Copyrights are automatically granted to the authors of creative works at the time of creation, regardless of whether or not they register their mark with the United States Copyright Office.  Registration however, is necessary to sue someone from infringing your work.  Masck registered his photo with the Copyright Office in 2011.

In his complaint, Masck notes that his photograph “has become an iconic image” in college football.  To support this assertion, Masck includes in his complaint images of President Barack Obama, the First Lady, and “a dog owner” re-enacting the Heisman pose.  Masck suggests the popularity of this pose resonates from his photo of Howard, as opposed to the popularity of the Trophy itself by noting that when people imitate the Heisman pose, they imitate the pose struck by Howard, with one foot up, as opposed to the pose of the actual trophy, which has both feet on the ground.  Masck’s complaint contends that “without this perfect shot, from this particular angle, the concept of the Heisman pose most likely would never have gained the resonance and cultural momentum it has today.”

The complaint begins by recounting the making of the Heisman pose photograph, beginning at Masck’s birth in 1962, describing his childhood makeshift darkroom, detailing his time at the University of Michigan, and ending in his “shot of a lifetime” on November 23, 1991.  The complaint concludes with allegations that Masck’s iconic photo has been reproduced in violation of his copyright. Masck notes that in order to detect unauthorized reproductions of the photo, he extended the lettering on the football, and removed the branding from the glove on Howard’s right hand.

Any person who violates the exclusive rights granted to the owner of the copyright, for example, by reproducing unauthorized copies of a photo, is an infringer of the copyright.  Copyright infringement is a federal violation that can be prosecuted as a criminal offense, but is more often brought in actions in civil lawsuits as is the case here.  Those found liable for copyright infringement may be forced to stop the infringing activity, compensate the copyright owner, and pay statutory damages up to $150,000.

Furthermore, even though the photograph is of Howard, this does not necessarily mean that he has any copyrights to the image. Usually the photographer is the sole owner of the copyright in the photograph, unless he was a “work for hire” and/or contractually bound to transfer the photo copyright to the subject.  However, local personality rights (in other words the right of publicity) may limit the use of a photo without permission of the subject.  So Howard may have publicity rights in the photo, but not enforceable copyrights.

Defendants were served with copies of the complaint on January 18th and have 21 days to respond.

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Using Images from the Web Legally

This composite Creative Commons logo is a mosaic of 2500 flickr images licensed under a Creative Commons license.  Photo by qthomasbower on Flickr, reproduced under a Creative Commons License (Attribution and Share Alike).

This composite Creative Commons logo is a mosaic of 2500 flickr images licensed under a Creative Commons license. Photo by qthomasbower on Flickr.
Reproduced under a Creative Commons, Attribution-Share Alike License .

Scenario 1:  You are preparing a presentation for a group of potential clients.  To jazz up your slides you search clip art available on the web and find images that would perfectly enhance the point you are trying to make.  So you extract the images from the web and embed them in your presentation.

Scenario 2:  You just completed your new blog piece, and to attract the attention of readers you are looking for a snazzy image to complement your article.  After searching the web, you find the ideal image, capture it, and add it to your blog posting.

Are these acts legal?

Many people correlate the internet to the “public domain” and surmise that since the image is publicly available (and often contains no copyright notice), it is not subject to any intellectual property rights, and therefore the images posted on the web are free for anyone to copy and use.  However, this is not necessarily the case, and should you misuse images posted on the web you may be infringing someone’s copyright.

Copyright is a legal concept granting creators of original works exclusive rights to reproduce, display, perform, distribute copies or prepare derivative works based upon the copyrighted material (subject to some important rights granted to the public). Since copyrights are automatically granted to the authors of creative works, and last an extremely long time, an image found online may still be protected under a copyright even if it lacks a copyright notice or information about the author. If you violate someone’s copyright, you will at a minimum likely be asked to stop the infringing activity, and furthermore, you could be subject to a civil lawsuit that could include statutory damages up to $150,000 per image.

This article provides some general guidelines to follow to avoid copyright infringement.

1.  Use your own images, but when you can’t, seek permission to use an image

Obviously the best way to avoid copyright infringement is to use your own images.  However, when that is not possible, the next best thing to do is seek out permission to use the copyright-protected image.  When asking for permission to use the image, first make sure that the person you are asking is actually the owner of the copyright.  Next, carefully read and understand the granted permission so that you know where and how you can use the image.  For example, does the owner request that you credit them?  Be sure to adhere to any limitations attached to the permission.  Also, don’t be surprised if the owner requests that you pay for use of the image.  People creating the images that would spice up your blog or presentation are generating something of value, and they may want you to compensate them for their efforts.

2.  Understand “fair use” and apply it

Under certain circumstances, it may be possible to use a copyrighted image without permission if your use would constitute a “fair use” under Section 107 of the Copyright Act.  Under the statute, an image is used “fairly” when the image is being used for the purpose of criticism, commentary, news-reporting, teaching, scholarship or research.  Should your use of an image ever be challenged, courts will consider the following factors in determining if your use of the image was fair or not:

(1) What was the purpose and character of the use?  Was it commercial or for non-profit educational reasons?   Is your use transformative of the original use (i.e., are you using the original for an entirely new purpose or are you creating a new work from the original)?

(2) The nature of the copyrighted work?  Is it fiction or non-fiction?

(3) How much of the work did you copy?  The court will look to see the amount of the material that was used (copied) and compare it to the copyrighted work as a whole.  Did you use too much?

(4) What was the effect of the use on the potential market for the value of the copyrighted material?  Did your use drive down the price of the work?

So how would these factors apply to scenario 2 above? While no one factor is determinative, if you use a verbatim copy of a creative image for the same purpose for which it was originally created, to promote your for-profit business, it may be safer to seek permission than to rely on the fair use doctrine.

3.  Take advantage of Creative Commons  licenses and public domain images

Creative Commons is a nonprofit organization that enables the sharing and use of images uploaded by photographers.  If the image you are interested in using is offered under a Creative Commons license, you may be able to use the image without having to contact the creator or pay for such use. For more information see http://creativecommons.org.  It is important that you understand the terms of the specific Creative Commons license covering the image you are using.  Some licenses require you attribute the creator and/or prevent you from modifying the image or making commercial uses of the image.

Creative Commons licenses are just one of many ways that creators of copyrighted work can make their works readily available to the public.  For example, some works have been released into the public domain and are therefore available even without a license (e.g., www.public-domain-image.com).

4.  Purchase stock photos

If all else fails, you can always purchase or license the images you are interested in.  If you need an image quickly, you can license the use of a stock image (for a price) at sites such as http://www.istockphoto.com, www.bigstock.com, www.shutterstock.com, or www.123rf.com.  Generally speaking, the price of the image increases with the quality of the image.