Masterfile wants $8,000 for one small image

[George]

Recently Masterfile Corp. Sent me a letter demanding $8,000 for one small image that they found on the front page of my website. It was about the size of a postage stamp. To the best of my knowledge this image was part of a template purchased from one of the online template companies. I informed Masterfile that there was no intent to infringe on the copyright and that I have not profited from the use of the image. I removed the image from the website and the server within hours of their letter. I also told them that I operate a very small Mom & Pop online business that receives fewer then 100 visitors per day. I offered them $500 thinking that was more than fair and hoping if it goes to court the judge will consider all of my actions. Today they told me no way to the $500 but that they will accept $5,000 if I pay the amount in the next 7 days. I'm thinking maybe to go up a little more ($1,000). If I do end up in court and the judgement is less than $1,000 would I have to pay their attorney fees?
What do you think my next move should be?

[Oscar Michelen]

Having dealt often with Masterfile, I can tell you that it is better to settle as they will likely sue. If the $1,000 offer doesn't settle it, then you can email me the details at xxx or call my office at 1 800 640 2000 to discuss retaining me to help you through the process.

[SweFlo]

My situation is identical to yours.

My small business had a small image from a purchased web template on a secondary page. I got an $8000 demand letter from Masterfile.  I tried to settle with a smaller sum, got a no way answer and a counter with $3000. Then I tried $1000, and they accepted it yesterday, so I would try that if I was you.

[George]

I offered them $1000 and they accepted. It seems that 1K is the magic amount per image.

[Oscar Michelen]

Good news although sometimes they seek and demand way more than $1,000 for one image