ExtortionLetterInfo Forums
ELI Forums => Getty Images Letter Forum => Topic started by: jlucas111 on November 27, 2008, 11:37:49 AM
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About month ago I received my first Settlement Demand letter from Masterfile Corporation notifying me of copyrignt infringement. There are five images on the Company Website they claim are copyrighted by Masterfile. They are seeking $32,160.00
The website was designed and created by a third party in 2005. I contacted the company who created the website and they claim they purchase all thier images through IStock photos. They were not able to locate thier records regarding the images in question. The third party company contacted Masterfile and explained to the complaince manager that the images were purchased through IStock, but they had no records of proof.
It appeared that the issue may end threre. It did not.
Even though the business ceased operations in 2006, the website was still up. I took down the website the same day I received the first letter from Masterfile.
I contacted Masterfile via phone and spoke with the complaince officer handling the claim. I told her I was unaware the comapny violated any copyright infringement laws. I told her there was not willfull intent here. I told her I took action to remove the website and that the company ceased operations in 2006.
She said that did not matter and she expected payment in full within 15 days and that Masterfile does not offer any settlements less than the stated amount of $32,160.00 I explained to her the company is no longer operating and that we were incorporated, but since dissolved the corporation in 2006. I also mentioned that there are not any assets associated with the company. In another words, there is no cash or assets to lay claim on should you win a judgment against the company. My point to her is this is a waste of your time and resources to pursue.
She latered email papers showing they filed copyrights to the images with the US Copyright Offices in 2002.
She claimed Masterfile Corporation would pursue this case and will plan to file a lawsuit within 30 days. She also claimed Masterfile has won almost every case they have filed with US Federal Courts. She also stated Masterfile will pursue any and all company officers personally to obtain the $32,160.00. They are prepared to file leins and garnishments on all parties involved.
I told her you must do what is best for your organization and I must do what I need to do in this matter.
Yesterday, I received another letter from Masterfile demanding payment of $32,160.00. My response to the letter was via email,and told them that the company is not operating and has been dissovled. Even if I agreed to pay the monies, the company does not have any cash or assets.
In the email I communicated to the complaince officer it appears this matter will not be resolved. So please file the lawsuit and I will let the US Federal Court resolve this case.
My thought process is even if they do move forward with this lawsuit and win a judgment, there is nothing to get from the company. And since the company is longer operating, I could file bankruptcy on the Company to ensure they have no remedy.
What are your thoughts? Would your letter help in this matter?
Thanks
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We are dealing with Masterfile on about three matters right now. They are a bit better to deal with than Getty in that they at least provide you with the information that forms the basis of the claim. We are expecting a response to the latest letter we sent them at the end of next week. Our position with Masterfile (who registers the images with the Copyright Office) is that the Copyright Law allows judges to reduces damages to $200 per image for cases of "Innocent infringement" In my opinion under the facts you present no Federal judge would award the amounts Masterfile demands. In a recent case, (2/4/2008) filed here in NY, Masterfile v. Country Cycling 06 Civ. 6363, Masterfile sought $5,500 per image. The defendant did not answer the complaint and only sent a letter into the court explaining its position. The court found innocent infringement and awarded $1,120 in statutory damages, the cost of a two year license through Masterfile. I think the court would have awarded less had the defendant had legal representation. What really hurt the defendant was that the court also awarded $4,860 in legal fees. The court indicated that it would have awarded less had the defendant offered a reasonable sum before suit was filed.
So unlike Getty, Masterfile does file for copyright. Now, the interesting thing (at least to us intellectual property geeks) is that to save money Masterfile compiles hundreds of photos into compilations and files them as compilations. That means though that even if you take 20 photos from that compilation, it is only one infringement. Also unlike Getty, Masterfile does file suit if you are unwilling to settle. In your specific situation, if your corporation is dissolved, then Masterfile will not get paid. They cannot go against officers or directors individually that's why you incorporate in the first place. I think that is a bluff on their part.
Our letter will help stop them from harassing you and we would try to get them to accept a reasonable settlement if you are willing to do so, but if they do file suit, and you wanted to retain us to represent you in court, we would reduce our hourly rate from $450 to $150 per hour Its really up to you in light of the situation with your company whether you want to invest any money. Probably worth the $150 for the letter to see if we can make it go away.
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Oscar,
Thank you for your response. I will call you on Monday to discuss the letter further and my situation with Masterfile.
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I thought a take down notice is suppose to be sent first and then a demand letter if the "stolen" images are not removed from a website.
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No, the law does not require a cease and desist notice at all. They can just proceed right with a lawsuit without any other notice.
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There seems to be some fairly common misconceptions among us laypeople about the protections afforded to Online Service Providers in the Digital Millennium Copyright Act ... requirements for takedown notices, safe harbor provisions and the like. The key is, I think, that these DMCA protections apply to Online Service Providers to limit their liability for what thier users post on their website. I dont think there is anything in the DMCA to limit liability of website owners for website content directly under their control. Someone please correct me if I am wrong about any of that.
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That' s right lettered.. Here's the brief description Wikipedia version of DMCA II which gave OSP's the protection:
Title II: Online Copyright Infringement Liability Limitation Act
DMCA Title II, the Online Copyright Infringement Liability Limitation Act ("OCILLA"), creates a safe harbor for online service providers (OSPs, including ISPs) against copyright liability if they adhere to and qualify for certain prescribed safe harbor guidelines and promptly block access to allegedly infringing material (or remove such material from their systems) if they receive a notification claiming infringement from a copyright holder or the copyright holder's agent. OCILLA also includes a counternotification provision that offers OSPs a safe harbor from liability to their users, if the material upon notice from such users claiming that the material in question is not, in fact, infringing. OCILLA also provides for subpoenas to OSPs to provide their users' identity.
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Update on Masterfile's infringement claim. Since my orginal posting I have communicated with Masterfile and have made several attempts to resolve this matter.
I proposed a settlement of $1,000.00 and they counter with $10,000.00. I counter back with $1,500.00 and they counter back with $2,500.00, which I agreed to if they would allow me to pay the settlement over in 12 equal monthly payments. I thought it was best to pay the $2,500.00 to put this situation behind me.
They declined my offer of settlement and plan to file a lawsuit for the full $32,160.00.
It surprise me they would not accept the offer because of the payment plan.
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Because they registered the images before your use, this amount is fair; not great, but fair. If they sought statutory damages you should be aware that the Copyright Act of 1976 lets a federal judge reduce all damages to $200 per infringement. Also please be aware that when Masterfile says they registered the images, they mean they registered them in bulk,not individually. They take a couple of hundred or thousand images and register them as "compilations." What that means is that the compilation becomes the "Work" and not the individual image. What that means is that if you then take forty images from the compilation, you have infringed precisely ONE time. Keep that in mind and check to see if the five images all came from one compilation, then you have only one infringement not five.
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Hey Lucas, did you have any more correspondence with Masterfile? Did they offer your payment plan?
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Masterfile does negotiate and depending on the circumstances may offer a payment plan.
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I'm another recent Masterfile casualty. Not sure how to proceed. Was your situation resolved? Did they accept a negotiated payment?
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While every case is different, I have found that Masterfile operates very professionally when contacted by our firm.. They are responsive to our position and explain their position in a responsible manner. It's funny that even dealing with NCS Recovery (which of course Getty also uses) is different when they are representing Masterfile. I will say that the only gripe I have with them is that their original demand letters ask for extreme amounts ($2,000 - $4,000 per image) and that they seek individual amounts of damage for each image even though most time the various images were registered as a collection.
I will be in my office tomorrow if you want to give me a call 1-800-640-2000 or email me at xxx
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Hello,
I have a small I.T. company. I have contracted out a web designer on Elance.com to create a website for my company at the end of year 2008. About 2 months after the launch of my website, at the end of February 2009, I received 2 separate letters from Getty Images(via regular mail) and Master File Corp.(via Fedex) Mastefile Corp. claims to own 2 of the images and Getty Images claim to own 1 image. Needless to say my first reaction was to take off ALL the images on the website immediately after I received the first letter.
Getty Images asked for $1300 for an image that they sell for $49 on their website. Masterfile asked for $8000 for 2 images that they claim to lease for $1000 for a period of 3 months for each image.
According to Elance.com's policies it is illegal for contractors to use copyrighted material without paying for it. So, I have contacted this contractor who did the design job for me and he has been communicating and negotiating the price with both companies. He accepted that it was his responsibility to pay these damages.He has managed lower the amount Master file Getty images but the amounts are still extremely high. (After all the whole website was created for around $150 . And I am not sure if he will be paying these amounts but he risks to have his Elance account closed if he doesn't do something about it. )
Further more , Masterfile was only able to send the copyright certificate for only one of the images they claimed that belongs to them. The second certificate that they have sent supposedly for the second image doesn't mention anything about the image in question or the author. Also, please note that the second image is a picture of what seems to be a modern Macintosh keyboard and Mouse. (I wonder if they have the right to sell such an image?) I have tried contacting Apple Inc. but they haven't replied any of my e-mails regarding to this image. With the exception of sending me an automated message telling me that they have received my e-mails.
Any thoughts please?
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The limited use you made of the images - just a few short months - will help in reducing your exposure as both Getty and Masterfile claim their damages' demands are based on use and the cost of a "retroactive license fee." Ultimately the contractor will be the responsible party if there is a finding of infringement, so its great that he has stepped up to the plate. Understand that if Masterfile brings suit, it will register the unregistered image beforehand and then it will be entitled to statutory damages on the registered one and actual damages on the unregistered one. For a description of what those are, see our "Summary" post.
Getty has filed lawsuits several times, but only for cases involving more than 20 images, that I have found. Masterfile is much more likely to file suit (even for 2 images) if a settlement isn't reached. I can't advise you as to what is a fair value as every case is different and both of these entitles have used many different settlement numbers. As to the Apple issue, let me know if you hear anything back.
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Hello Oscar,
I am a webmaster and a client has just had communication from Masterfile asking for payment for 2 images I used on the website. I haven't seen the letter yet so I don't know full details.
I have taken the images off the website - together with several others that I used from the same source.
I originally got the images from AllWall.com in April 2000 and used them under the deal where I could show the thumbnails if I put a link to order posters of the pictures on the page on which they were displayed. I also had an affiliates account with AllWall so I could receive a percentage from the sale of any pictures. I used quite a few pictures but made no sales.
Mid 2001, AllWall.com bought Art.com from Getty images and used the Art.com name, ditching the AllWall.com name. I still get emails from art.com although I didn't sign on for the new terms of the affiliate scheme on the change over.
However the link on our website to one of the pictures in question still takes you to the same picture on Art.com. And Art.com still have the deal that you can display a thumbnail if it is linked to their site - so I don't see how there is a problem. Here is that link:
[I have omitted the http:// so it won't auto link]
allwall.com/asp/sp-asp/_/NV--/PD--10007289/SZ--2/posters.htm
I also found the same picture on Masterfile.com - photo number 700-00015941
The other picture in question isn't currently linked - I must have removed it during a page redesign - and I can't find it on Art.com but I have found it on Masterfile.com
I am taking all the pictures off the site now and looking for more links - but I'll keep the files as originally on display.
How do you think it looks for dealing with this case?
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It will depend on when Masterfile filed its copyright. One of the things I have found dealing with Masterfile and Getty is that sometimes even though the photographers promise not to to make their images available anywhere else other than the site that licenses it, they have forgotten or intentionally lied to Getty/Masterfile and in fact either previously or subsequently licensed their photos for other uses. if you can show a clear chain as you describe, you may be in a good position. I will be in my office tomorrow after 1030am (NYC time) 1-800-640-2000
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Realtor in Utah,
We recently experienced what I call Internet extortion. I had purchased a product endorsed by the CRS as a good and viable product for Realtors. This product is used for Realtor web content. Real estate tools for buyers and sellers. Very good content, I paid around $599 for it. The content is hosted and provided by a vendor, so it is not actually on my website, just framed in. Just other day I received a FedEx package with a demand letter for copyright infringement by a company called MASTERFILE CORPORATION. They claim I owe money for the use of about 27 photos which were on the web content program I paid good money to get. There bill was over $75,000. Yes these Internet gangsters were asking for that much! I called them to find out what the heck was going on and told them I paid a web company for the content and there must me some misunderstanding. These extortion experts don’t seem to care about that or going after the provider of the content. Just the end user. Well after quiet a bit of research it was clear that MASTERFILE CORPORATION had figured out how match up photos with websites using some sort of program. Various artists have placed with this company digital artwork to file a copyright on. I am to believe that good honest web programmers and designers pay this company for the use of the stock photos. Ok all is good. However Masterfile runs their photo matching program and then asks the end user for copyright proof. Of course we don’t have the copyrights provided to us. Now we end up defending a potential lawsuit. Masterfile knows this but chooses to harass and extort money from end users that have not knowledge of any infringement issues. Apparently this is legal?
Masterfile most likely knows that copyright claims where the innocent 3rd party has no knowledge of a copyright has a maximum claim per copyright of $200.00 per copyright filing. Digital photos and artwork are commonly filed in copyright groups. Our exposure would at max be allegedly $2000.00. Masterfile most likely knows this. This is why i think they are a bunch of thugs.
We tried to come to some sort of settlement to avoid a legal battle an offered them $2000.00 (even though we don’t owe them anything). They now want about $36000.00! My wife and I just do not know what to do and are just sick about this. Hundreds or Thousands of users bought this same program content and i think Masterfile just wants to sue everyone thus getting big bucks for something that has been paid for the the original provider. The web content provider is doing damage control, and removing any photos it has on their site that get framed onto all the other Realtors sites. I am leaving the name of the producet off this blog for now in hopes the company that sold the content with me will settle with Masterfile.
Can Masterfile be prosocuted in criminal court for this?
Any helpful information is greatly welcomed.
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Dear mgale:
What Masterfile is doing is not illegal. They have registered copyright in the images they protect so it should be fairly easy to prove whether they have a claim or not. As an end user, you are technically responsible for any copyright infringement though you would be able to go after the content provider for reimbursement of whatever you paid Masterfile. It would certainly be in the content providers interest to settle globally with Masterfile as opposed to have to handle each claim as it comes in. There maybe a number of defenses to the claim as well. At the very least you are an "innocnet infringer" which could greatly reduce any damage award you would be facing. I have handled many Masterfile matters so if either you or the content provider (or both) want to discuss this with me please give me a call 1 800 640 2000. You should also review some of the posts on the issue to familiarize yourself better with the situation.
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Hi all!
A website client of mine recently received a notice of copyright infringement from Masterfile for two images. The kicker is that the client does not have any of the images on his website. A review of the letter sent from Masterfile shows screenshots of a pre-design prototype of his website but not his actual website. Moreover, the alleged infringing website is on a server that is not controlled by my client and has a URL completely different from his. The name of the URL also has absolutely nothing to do with the subject matter or industry of my client. I contacted the listed technical contact of that website and he claims he does not know who put the replication of the site on his server or why the URL was pointing to it. A Wayback Machine check of that website does not show any of the images. My client contacted the FBI and they said they were familiar with Masterfile Corporation and told my client it was a scam.
My client sent Masterfile a scathing letter informing them of the facts and that he is not liable for any content published or used by a third party with whom he has no associations or affiliations with and on a server over which he has absolutely no control over. It will be interesting to see how Masterfile proceeds.
In the meantime, I am curious as to what the FBI is investigating regarding Masterfile. One thing I think is that Masterfile knows that 90 percent of their images used online were sold by someone either directly or indirectly affiliated with them prior to 2006 (they claim 38 affiliations worldwide) and that those parties are no longer in business or affiliated, allowing Masterfile to now come back against all the innocent purchasers and claim infringement. The most telling thing is Masterfiles letter. It does not say anywhere "show us proof of ownership" or provide a receipt, etc. It just claims infringement. It would be great if someone actually saved their email payment receipt or credit card records from 2000 to present so they could prove something.
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I have found with Masterfile that when you show prior purchase from a valid source, they drop their request for damages. The difficulty is in finding the proof of payment or connecting it to the exact images that they now claim are being infringed upon. While I have a great number of issues with their approach, they are light years ahead of Getty and are usually willing to listen to sound arguments. That being said, I thnk a concerted effort to make this issue more public woul dgreatly help the situation asin the end I think both Getty and Masterfile's approach are bad for their own busniesses and bad for copyright law in general.
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I agree Oscar, but on the other hand, I went to Masterfile's site to look up the price of the two items they claimed were infringed and my conclusion that for those particular items, catalog numbers 700-00023992 and 700-00020568, I can only conclude that Masterfile either had no realistic intentions of trying to sell the images for the outrageous licensing prices of from $500 to over $2500 apiece (similar and sometimes better images were being sold on istockphoto for around $40!) . Maybe the person that sets the prices for Masterfile images is on bad drugs?
In any event it seems like Masterfile's business model is to make its money from threats and litigation rather than actual sales. I would love to find out how much of their revenue is from legal action (including from demand letters) versus people actually paying for their images which are several times the prices of other stock photo providers. I am sure that Masterfile may have a collection of images that people would buy, but the two in question I can guarantee no one would buy from them and would go to istockphoto instead. I guess if Masterfile is not guilty of extortion, they most certainly could be placed with those who price gouge customers!
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While I agree with your client's position that it is not liable under these circumstances, I find it unlikely that the FBI is investigating Masterfile for this program. At best this would be civil fraud, it would not rise to the level of a crime. My firm does a lot of federal criminal defense litigation as well and believe me the FBI have their hands full with true racketeering; terrorism; child pornography and identity theft. So I would love to hear about the actual contact with the FBI so I could follow up on it.
When clients maintain their receipts and can show proof of purchase of the images, Masterfile will normally back down. But your point about keeping the receipts is correct - most people don't do that and if they do, they don't keep them for 7 years or so. I advise all clients to keep a hard copy file in their office of all the issue dealing with their website - registration; images; design purchases etc., so that they have a resource to go to if their computer crashes or they just buy a new one and don't transfer over the information.
Thanks for the post and please keep us updated.
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I was contacted by this firm as well indicating I had a pic on my web site that was being used without an agreement. I was totally unaware of the use of the pic on my site as being or belonging to someone. In fact I used a third party to design my site and for all I know we purchased the pic several years ago. But that said, we only put it on the site in November of 2009.
Just tell me your thoughts. They are trying to get $3,000 from me. They offered to settle for $1,200. If I did something wrong I do not mind paying but I am not even sure I did and in some cases where a person was unaware of the infringement a judge will award $200 max per infringement which in my case I was unaware. Now they also recently asked me to provide them proof it was in fact placed on the site in Nov of 09' and that may have an effect on the settlement. They are charging me for one year. Don't they have to prove that amount of time? Is there any type of limit to the time you have a pic on where the court might say "four months, for get it", is there? I am thinking that sending them anything acknowledging the use of the pic could be used against me and I should only produce such evidence when needed and if needed in a court. Also, I have several clients/associates that would attest to the fact that the pic was not there prior to November, 09'.
Please advise.
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The $200 for innocent infringement is not automatic and you have to go through litigation to have a judge award that. The length of time is relevant and they would have to prove that if they wanted to use that as an element of assessment of damages, but the court can also just award a straight statutory amount along with attorney's fees. A court will also consider if you made a "reasonable" settlement offer in determining how much to award them in attorney's fees,so you may want to keep that in mind as well.
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Oscar, thank you for the reply. We did actually settle it and I believe they are really trying to do the right thing for the artists they said they made a promise to that they will protect their work. That said, I think the laws should be somewhat updated to allow a user a grace period to remove the image first. I had a few conversation with the person I dealt with and I think he was quite reasonable. I am not sure if this is what everyone wants to hear but try and see it from their side. If you had your work used without your knowledge how would you feel? Then and only then make the case with you on the other side. Just try and imagine that. I made a mistake and while it was an honest mistake it was one nonetheless. Now I say all this with the assumption that the image was not purchased and maybe just the records lost of the purchase or in some of the cases described above where the firms selling the images went out of business and so now these firms are going after people hoping they have no proof from images acquired years earlier. But that said, I think they have a point. People need to be careful to use images they are not sure where they came from. Am I happy I am out some money? Of course I am not but if I were on the other side I would not be happy either.
Thanks again.
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Glad it worked out and thanks for updating us.
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We are a small california based IT consulting company, our company website developed by one contractor in India for US $500, Got Similar demand letter in Dec 2009 from Masterfile for using 8 images for $20,640.00, I was surprised, because I do not know the contractor used copyright stuff, then I sent that notice to the contractor who developed our website, thought that he will respond with copyrights to me, but he did not respond to that notice. Our company is in deep losses in 2008 and 2009, also our company is not doing any busienss now - so planning to dissolve, but our website is up and running. I my self found job at some other company. So did not respond to that letter, later Masterfile sent another notice to our website hosting company about hosting 3 copyright images and stop hosting thme - how come they reduced copyright images from 8 to 3 ?
Then that contractor simply removed those 3 images from our website in March 2010, later we got another demand notice from Masterfile saying like"it is not done by removing the images - but you must pay" - then that contractor remvoed all the remaining 5 images from the website in May or June 2010. But in 2nd week of July 2010 Masterfile sued us for $1,220,000 in california federal court in San Francisco. We did not communicate with Masterfile till today. Please help.
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Give me a call after 230PM NYC time to discuss 516 248 8000
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See my response to you other post Lynn
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Let me start by saying thank you for being available to assist all of us targeted by Masterfile. Sadly I am now part of the "family". I received the demand letter on September 13, 2010 for (1) image on my puny little web page. The demanded amount for this copyright infringement was $2790. It was amazing (within minutes) how quickly the "agent" dropped the price to $930. I said I would look at the offer. Well it took the Bozo 2 weeks to push the right buttons and send the "agreement" to my email address. I promptly called and spoke to the agent. I mentioned I had done some research and really believe the "agreement" payment was excessive. I understand this image was on my web page, but I didn't use it for any other sort of marketing (brochures, business cards etc).If ever there was an "innocent infringer" I qualify. Now, this is were I will admit my stupidity. I allowed my daughter's 18 year old boyfriend to create my little web page four years ago. No surprise I had him help me because my tech skills suck. I would have never even thought about copyright infringements because IT is not my specialty. Fast forward 4 years later and Masterfile enters my life. Any suggestions? The demand letter states I must pay $930 by September 30th. Should I counter with a mid range amount?
Any assistance will be greatly appreciated
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Please email me your contact info to xxx
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Good evening,
I emailed privately so I my be repeating myself. I so want to resolve this issue but I need some sound advice before I just write the check.
I am now holding a letter from NCS Recovery Service demanding the full amount of $2790.00. What steps do I take now?
Really can this company collect this incredible amount of money or do you think I should offer a lower amount (the original $930 that Masterfile felt they could live with). Is there a magic number to get these people out of your hair?
I look forward to hearing from you. I think it is time to retain your services.
[email protected] or call 503-939-5315. Thank you
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Our small amateur radio club is a new victim of the Masterfile extortion. We received an email from the company via one of our members notifying us that we were using a copyright image on our website. Our website was developed by one of our members many years ago who had a bit more knowlege than the rest of us in this area. Originally we passed off the email as one of those very clever scams that are popping up on the internet. When we recieved the second letter it appeared that this was probably a valid claim by this company. On doing some research we found the multitude of victims in different forums. We contacted our insurance company to determine if we are covered by our liability insurance. We have recieved a call from the adjuster of the insurance that is investigating the claim, his recommendation is that we wait for the lawsuit to be filed before we do anything and was going to check on coverage for liability in this area. A local attorney recommends that we respond to the email and try to negotiate a settlement. Not sure what to do at this time. Is an email letter a valid legal notification? It was interesting that the email has our complete P.O.box address but we have yet to recieve a "hard" copy via the USPS. Is this because they do not want to get the Post Office involved in regard to possible mail fraud? The Masterfile letter also indicates that we as officers of the corporation (we are incorporated for 501c3 purposes) are liable for actions of the corporation. Can they come after me and the rest of the members of the club for their outrageous demands?They are asking $11,132.00 and our club treasury has only $1.300.00 in it. The biggest thing that bothers me is that it was a logo on the website that was informational in nature to the members of the club. We make no money off the website, we are a strictly volunteer organization that provides communication support for the community by assisting the Red Cross, Emergency Government, National Weather Service and a multitude of charitable organizations such as March of Dimes, Leukemia, Mutiple Sclorosis, etc. Any suggestions?
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WolfWolf, sorry to hear about this predicament. I'm not an attorney or anything like that. But here's my thoughts.
Usually, you'll receive some threatening emails at first. Later on, they may choose to escalate it; more emails, papers sent by mail, and phone calls. You know... they'll try to pester you so that you'll settle out of court. Suing for money is not their true goal; it's only part of a strategy. Often, copyright trolls like masterfile don't really get a lot of money if they win a lawsuit; the attorneys often get most of the settlement money (if they are able to collect their legal fees). But, filing lawsuits scares a multitude of people into settling out of court, and that's where the real money is.
If they decide to litigate, I think that they'd have to sue the corporation; they can't sue individual officers in most jurisdictions. If your corporation is in fact non-profit, you should be aware that what monies masterfile could collect may be severely limited in some countries/areas. You should check about this.
Even if they eventually sue you, it wouldn't be too late to negotiate and settle out of court if you choose to do so.
If they did sue the corporation, they couldn't get more than the assets of the corporation, in this case $1300. After that it's 'bankrupt', and it's over. They'd get a measly $1300 if they're lucky, and have to eat their legal fees.
If things get dirty, you might consider closing down the corporation. Then, masterfile couldn't sue some defunct entity. Then you could open under another name later on. This may or may not be practical for you.
If you chat with your attorney, bring up a few of these points if you feel comfortable doing so. It wouldn't hurt.
Masterfile has laid off many employees in recent years, even a bunch when the economy was 'good'. If you're in marketing, you know that paying huge prices for your images from a place like masterfile might get you fired; I have no doubt that their sales are slowing in this economy. So, it should be no surprise that we're hearing about so many of these threatening letters and outrageous claims; it's just another revenue stream for them.
Good luck,
S.
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Dear wolf:
Do not ignore it and do not wait for it to get to a lawsuit. You are not entitled to any "legal notification" prior to their filing a lawsuit so email is as good as regular mail for notification. You don't say how many images are involved, but I think its best if you at least try and call Masterfile, tell them your version of events and the history of your website and you might get a reduced settlement figure.You can email me or call my office Monday afternoon 516 741 3222 to discuss this in further detail
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Hello Mr Michelen,
I want to thank you again for your phone call on October 28th. As I told you it was my birthday and having your guidance made my whole day!
I took your advice and made a phone call to NCS Recovery on November 1st. "Ashley" is managing my file. This business must be "rinky-dink", even when answering the phone they don't have the business etiquette to answer with the identity of the business. However, I spoke to Ashley and discussed my limitations for paying the demanded amount of $2790.00. She asked me what I thought would be a reasonable offer, my response was "somewhere between 0 and the reduced Masterfile amount , $930.00. I offered $500-600. Of course she would have to get back to me after consulting with Masterfile. Two days later I call NCS to find out the offer (again, the phone etiquette was lacking). At that point I really wondered if this was a legit collection agency. Ashley comes to the phone, asks what I want. I told her I was interested in the settlement amount from Masterfile. I also said I found their practice in greeting their customers less than business-like. Probably not the best way to start the conversation---"Dragon Lady" yells "what are you afraid Doris? Do you think I am trying to rip you off? (yes). Why don't you look up NCS info on the web and get back to me". Needless to say I have not called "Dragon Lady" back.
After multiple discussions around my dining room table, my husband is asking me why I don't close the business. The company is a LLC, so would I be held personally responsible for the demanded monies?
Honestly, this little business is a small service. My referrals are primarily "word of mouth". I am not website dependent. So closing this business through the state and feds, close the small bank account and restarting in 2011 with a new name is not going to impact my future.
Oscar, I guess the big question is, should I secure your services to notify the "creditors" that the business is no longer in existence and there are no assets.
I will say it over and over, I would rather support your fund and drop these sharks on their nose than to pay the extortion money
I know you are a busy man. I will wait for your reply.
Thank you
Doris
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Sometimes with small closely held LLCs, aggressive creditors will try to prove that it was not validly formed, etc to try and get at your personal assets. So we always recommend not to actually dissolve or close the business while a claim is pending. That can increase the chances of them reaching your personal assets. Its best to let it die a quiet death while the claim is pending. Put no more money into it, do all new business through a new corporation, let the domain name and url registration lapse, etc. I would recommend not spending any more money on this. Just leave it alone and see if they do in fact follow up and file a lawsuit they may not. There would be no point in spending money to have anyone call them to tell them you have no money.
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Thank you Mr Michelen,
Your counsel is so appreciated!
I will make the changes as you listed and lay low and see what happens.
Thank you
Doris
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Keep us posted!
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Copyright is pretty serious. Do I believe it's extortion? Yes, but that's how it goes. I just finished my negotiations with Masterfile and they were quick to offer a settlement that I could swallow and wouldn't put me in the poorhouse. The process was not unpleasant, actually they went quite well and I was surprised that they are allowing us to make payments. They were very reasonable in dealing with the situation.
My next step is to go after the third party I hired to do the work!!
Thanks Oscar for all of your time to help small business. you're a good man. (even though your a lawyer) lol.
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Thanks OG ( I think). I have always said that Masterfile is more reasonable in many ways than Getty. It must be because they are Canadian