How Much Should Mathew Higbee’s Targets Pay to Get Him Off Their Backs?

by Paul Alan Levy

Because I have written a few pieces about the excesses of the copyright enforcement campaign conducted by Mathew Higbee and his law firm, Higbee and Associates, for nearly a year now I have been getting a steady stream of calls for help from bloggers and others who have received demand letters signed by Mathew Higbee contending that they were liable for the fact that visitors to their web sites could see works (mostly photographs) created by the firm’s clients. (He has told me that he enjoys the fact that I get so many inquiries; serves me right, he thinks.) In a number of such cases, the Higbee firm is overreaching because the blogger has a good defense under established law, but in other situations, a photograph was used in a way that should have been licensed, but was not, and the only issue is how much the alleged infringer has to pay to avoid being a defendant in an infringement lawsuit in which there is no realistic path to victory.

Many Higbee Targets Did Infringe, and Could Be Liable for Damages

In such situations, I have tried to give my inquisitors a realistic sense of their situation, including disabusing them of the all-too-common Internet myth that, if you find a photo or other image online that could help illustrate something you want to talk about, there is nothing wrong with posting that image only because its creator did a good job of portraying the situation about which you are writing; it is an illusion that you can easily defend based on fair use (this recent appellate ruling is representative of the actual rule).   The fact that the use was in connection with a noncommercial discussion, or with web pages that may be lauded as making a valuable contribution to the community in some respect, will ordinarily not be enough to produce a fair use ruling.  Thus, in many situations, the only real question is, what price the Higbee target is going to have pay for having been disabused of a misunderstanding about what is and is not allowed (or, more cynically, having been caught infringing the copyright in the image). Certainly, photographers (and other creators) deserve to get paid a fair license fee for their work.  And we have no issue with the Higbee firm seeking to have its clients paid what they deserve under the law.

But How Much Damages?

But we do object to the tactics that entail taking advantage of the ignorance of the lay people who get these demand letters and threatening emails.  In past blog posts, I have suggested that the Higbee firm tends to go overboard in its monetary demands, a tendency that is especially pronounced in the many cases in which the firm is seeking to enforce the copyright in a work that was not registered promptly upon first publication, or even, indeed, at the time of target’s claimed infringement of the work or the transmission of the demand letter. Registration is a prerequisite for suit to enforce the copyright, but a copyright owner can easily register for the purpose of filing suit seeking damages and injunctive relief. But an equally important limitation imposed by the failure to register is that, under section 412 of the Copyright Act, a plaintiff whose copyright is not registered in a timely fashion can seek neither statutory damages nor attorney fees.

Actual damages in a copyright case are, generally speaking, measured either by the profits made by the alleged infringer or the lost license fees of the copyright owner..  In most of the cases in which the Higbee firm is seeking a remedy, the Higbee target did not make significant profits from the use of the image. Moreover, in many of these situations, the graphics whose copyright the Higbee firm seeks to enforce can be found on Getty Images or similar locations, bearing license fees as low as fifty to two hundred dollars, depending on the use.

However, the fact that the standard license fees are so small does not discourage the Higbee firm from demanding payment running upwards of a thousand dollars, even several thousand dollars, from individuals and companies that posted (or linked to) a photo whose copyright was never registered, and from having its “claims resolution specialists” send one threatening email after another telling the targets that, unless they pay up immediately, the case is going to be “escalated” to the litigation team. Many of the targets of these letters find the prospect of “escalation” and “the maximum justifiable damages” intimidating; they are in no position to hire a skilled intellectual property firm to give them knowledgeable advice or to defend them. The easy course is to pay what is demanded, or to feel successful if they can beg a few hundred dollars off the demand. 

But what several targets of demands in these circumstances started to do was just send the Higbee firm a check for the amount of the license fee, but no more. For a few months, from what I have been hearing from Higbee firm targets, that strategy was successful.

Presumably, this tactic threatened to cut too far into the Higbee firm’s revenue model. So, in the most recent months, the Higbee firm has not been depositing the checks; instead, it writes back to the target demanding more money. The amount demanded is still so low that it would make no sense for the target to hire an experienced copyright lawyer to respond on its behalf.

The Higbee firm’s theory is that it is seeking, not only the lost license fee, but compensation for “the costs incurred in detecting and pursuing the unauthorized use.” That sounds an awful lot like compensation for attorney fees, which not only are not available in these cases, but under current Supreme Court case law are not even presumptively available to the successful copyright plaintiff in cases in which the copyright was registered in a timely fashion.  Courts have been holding attorney fees claims to a fairly high standard, as in the recent My Other Bag case  (rejecting my arguments for being more open to copyright fees claims, I might add).

Thus, late last summer, when I was preparing to write about the issue of excessive demands for actual damages, I asked Mathew Higbee if he had any legal basis for demanding payment of enforcement costs as part of the damages. As shown by a response linked from that blog post, he ducked the question, implicitly admitting that he has no decisions (and no basis in the language of the statute) that justifies seeking such amounts.

Cartoon Stock v. Society for Emblem Studies

Thus, our most recent open letter to the Higbee firm takes on the demand letter and a series of threatening emails sent to a tiny scholarly organization called the Society for Emblem Studies.  (Its web site explains what an “emblem book” is.)

Several years ago (outside the statute of limitations), one of its newsletters contained a cartoon whose licenses are issued by a British company, one of the Higbee firm’s stable of clients (it was on behalf of this company that he issued a demand late last year to Claudia Eckelmann over the use of a cartoon in the online syllabus for her class at a community college). The newsletter was archived on the Society’s web site; and there it sat where, apparently, it received no recent visits until this year when the Higbee firm, or its stalking horses, followed an image search and located it. A demand letter followed, seeking payment of more than $1300. The Society pulled the image down, and told the Higbee firm so; the Society even offered to pay $160, which is twice the cartoon’s normal license fee, but the Higbee firm’s paid nagger, Sarah Brant, said that removal was irrelevant because her firm's client wanted the damages payment. The Society explained that nobody had visited the page, and offered to send traffic data showing that fact, but Brant said that this fact didn’t matter either, that Higbee and its client did not care whether nobody had accessed the web page in question and thus seen the image on the Society’s server “Our client's image was taken and without authorization.” No, all they care about is getting paid, and getting paid as much money as they can extort through threats of litigation. 

But can you imagine the cartoonist filing a lawsuit and complaining that, during the period covered by the limitations period, the cartoon was accessed on the Society’s servers by the cartoonist’s own enforcement agents? It’s reminiscent of Barbra Streisand suing because her privacy was violated by the inclusion of a photograph in an online archive, where it was accessed largely by her own lawyers.

The Society could, at that point, have said to Brant that it would pay nothing because, in the absence of visits, there was no infringement.  But it wanted to be done with the controversy, so it sent Higbee a check in the amount of $160. Brant responded, “The check can either be shredded or sent back. Please let me know which process you would prefer. You cannot expect our client to take whatever you throw at them as a settlement. Your offer of $160 has been declined, again, and countered with $1,000.”

Well, yes, the Society can expect, and does expect, the cartoonist to take what the Society has paid, and if the cartoonist does not allow the Higbee firm to cash that check, he or she will get nothing. I explained this fact in a letter to Mathew Higbee earlier this week. 

Unlike other cases, where the amounts demanded were high enough that it made sense to due for a declaratory judgment of non-infringement, the Society remains willing to have its check for $160 cashed, and it is just not worth the filing fee and the pro hac vice fee to seek declaratory relief. Because the Society is in Virginia, we have to be ready to defend in Virginia:  I am grateful to Seth Greenstein and  Robert Schwartz and their firm for their sage advice and their pro bono commitment to join me in litigating this case if need be. 

If the Higbee firm doesn’t file a lawsuit and satisfy the judges that there is the basis for their repeated contention in demand letters and threatening emails that the actual damages includes for the costs of enforcing claims for copyright infringement, every other target that receives a demand letter in those circumstances will know not to take seriously their threat to sue for more than the lost license fee.  Even better: the Higbee firm could just take the license fee when offered, and stop trying to  intimidate their pro se targets with empty threats to sue for more.

UPDATE:

A number of people have used the comments to ask for my views on their individual circumstances.  That is not a good way to communicate, in part because every situation is potentially different.  Better to look on the Public Citizen web site for ways to write privately, and individually.