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  1. #1
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    Default Any Legal Risks Regarding Sending Automated Demand (Threat) Letters

    Specifically, I'm referring to service like Pixsy (just an example). What they do is, send (mostly automated) demand letters (threatening litigation) to copyright infringers, once they have detected any image being infringed by their image tracker. This process is requested by copyright's owner (along the rights to do it in their ToS). If the infringer pays them up, they take 50% and share 50% with the copyright's owner.

    So, my question or rather discussion is about, what sort of legal risks or requirements would be involved doing this sort of procedure? Can anyone commercially send demand letters and take profit from them (just by structuring up their Terms of Service regarding the rights?) Or are there specific requirements that must be fulfilled before one sends such demand letter on behalf on the copyright's owner. Could there be any sort of risk involded?

    This is assuming that copyright's owner has actually requested them to send the letter and it's not a fraud.

    Also what would be a way for identifying that the letter's sender is legitimately representing the copyright's owner? In case where the sender is not willing to provide any communication with the copyright's owner?

    Thanks for your time! I'm not asking anyone to give me legal advise. This is a general discussion regarding legal rights. So give me your opinions!

  2. #2
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    Default Re: Any Legal Risks Regarding Sending Automated Demand (Threat) Letters

    Quote Quoting mindways
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    So, my question or rather discussion is about, what sort of legal risks or requirements would be involved doing this sort of procedure?
    In the abstract, there are very few risks associated with sending a letter. Of course, it depends on what exactly the letter says.

    When one person designates another person to act on his/her behalf, it creates a legal relationship called an agency. The person doing the designating is called the principal, and the person being designated is the agent. When a principal designates an agent, there is always a risk that the agent will take action that causes legal problems for the principal. How significant the risk is depends on all of the relevant facts and the scope of the agency.

  3. #3
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    Default Re: Any Legal Risks Regarding Sending Automated Demand (Threat) Letters

    Quote Quoting pg1067
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    In the abstract, there are very few risks associated with sending a letter. Of course, it depends on what exactly the letter says.

    When one person designates another person to act on his/her behalf, it creates a legal relationship called an agency. The person doing the designating is called the principal, and the person being designated is the agent. When a principal designates an agent, there is always a risk that the agent will take action that causes legal problems for the principal. How significant the risk is depends on all of the relevant facts and the scope of the agency.

    I see, thank you for your response! So, is there a legal procedure or some sort of verification required for "designating another person to act on my behalf" , atleast in case of image pursuing? From what I can see, they have written all this as part of Terms of Service. But would that be enough?

    What I'm trying to say is that, since they actually take the money from infringer (if he pays), wouldn't there be strict rules that they would've to follow? Otherwise, anyone could do it with just mentioning that I'm representing MR. ______ who owns the copyright of this image and I'd litigate against you unless you deposit 300$ into this bank to pay your license fee.

    Also, how would someone (who receives the letter) be able to identify that they are actually acting on person's behalf?

  4. #4
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    Default Re: Any Legal Risks Regarding Sending Automated Demand (Threat) Letters

    Quote Quoting mindways
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    So, is there a legal procedure or some sort of verification required for "designating another person to act on my behalf" , atleast in case of image pursuing? From what I can see, they have written all this as part of Terms of Service. But would that be enough? ?
    It would be enough to form a contract if the TOS was a prominent document (not small print hidden away) and it took affirmative action by the client to agree to it. In other words the client would have to click on agreeing to it. The courts have said that something like, by using this service you agree to the terms of service. is not sufficient to form the contract.

    Quote Quoting mindways
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    What I'm trying to say is that, since they actually take the money from infringer (if he pays), wouldn't there be strict rules that they would've to follow? Otherwise, anyone could do it with just mentioning that I'm representing MR. ______ who owns the copyright of this image and I'd litigate against you unless you deposit 300$ into this bank to pay your license fee.?
    Companies like the one you mentioned are really copyright trolls. They try to scare the recipient into paying with the threat of litigation. But consider this, their normal demand is between $750 and $500 for each image infringement of which they receive 50% or say $375. In order to establish infringement, they 1) have to have the image registered with the Copyright Office, 2) must file a copyright infringement law suit in Federal court, 3) win the suit and receive a judgment. There are issues of fair use, commercial or private purposes, damages just to name a few issues that have to be litigated. That's not going to happen.

    Quote Quoting mindways
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    Also, how would someone (who receives the letter) be able to identify that they are actually acting on person's behalf?
    You can't.

  5. #5
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    Default Re: Any Legal Risks Regarding Sending Automated Demand (Threat) Letters

    A much informative reply, thanks budwad

    Quote Quoting budwad
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    It would be enough to form a contract if the TOS was a prominent document (not small print hidden away) and it took affirmative action by the client to agree to it. In other words the client would have to click on agreeing to it. The courts have said that something like, by using this service you agree to the terms of service. is not sufficient to form the contract.
    So, at this point, they do have acquired the rights to act on client's behalf and are safe doing it legally.

    Quote Quoting budwad
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    Companies like the one you mentioned are really copyright trolls. They try to scare the recipient into paying with the threat of litigation. But consider this, their normal demand is between $750 and $500 for each image infringement of which they receive 50% or say $375. In order to establish infringement, they 1) have to have the image registered with the Copyright Office, 2) must file a copyright infringement law suit in Federal court, 3) win the suit and receive a judgment. There are issues of fair use, commercial or private purposes, damages just to name a few issues that have to be litigated. That's not going to happen.
    Yeah, I'm aware that they likely won't file the lawsuit. They are in for the quick bucks by scaring ignorant people psychologically. Most of them don't even bother sending actual letters, they use bots and automatically generated content. So, my question was what risks 'they' could have to face, not the infringer. Or if they had to go through some long legal procedures before sending the demands. That you mentioned already, that a well written and affirmative ToS would be enough.

    Quote Quoting budwad
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    You can't.
    Doesn't this mean that all the copyright trolls can get away with the threats, even if they did not had any permissions from the copyright's owner? If letter's recipient has no way to verify them, I don't think anyone could report them.

  6. #6
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    Default Re: Any Legal Risks Regarding Sending Automated Demand (Threat) Letters

    Quote Quoting mindways
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    So, is there a legal procedure or some sort of verification required for "designating another person to act on my behalf" , atleast in case of image pursuing?
    I don't know what "image pursuing" means, but the typical way of designating someone to act on your behalf is to ask him/her/it. Sometimes the relationship is memorialized with a written contract (e.g., hiring a lawyer). You could even sign a power of attorney, but that's typically reserved for a few specific situations.


    Quote Quoting mindways
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    From what I can see, they have written all this as part of Terms of Service. But would that be enough?
    Enough for what? I'm honestly not sure what you're asking at this point.


    Quote Quoting mindways
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    What I'm trying to say is that, since they actually take the money from infringer (if he pays), wouldn't there be strict rules that they would've to follow?
    No, except to the extent that the person/entity is a "debt collector," in which case he/she/it would be required to follow the federal Fair Debt Collection Practices Act and any applicable state law of similar effect.


    Quote Quoting mindways
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    Also, how would someone (who receives the letter) be able to identify that they are actually acting on person's behalf?
    By demanding documentation of the agent's authority to act on behalf of the principal.

  7. #7
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    Default Re: Any Legal Risks Regarding Sending Automated Demand (Threat) Letters

    Quote Quoting pg1067
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    I don't know what "image pursuing" means, but the typical way of designating someone to act on your behalf is to ask him/her/it. Sometimes the relationship is memorialized with a written contract (e.g., hiring a lawyer). You could even sign a power of attorney, but that's typically reserved for a few specific situations.
    Quote Quoting pg1067
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    Enough for what? I'm honestly not sure what you're asking at this point.
    All the time, I'm talking about sending the litigation threat letters demanding for the license fees and the legal procedures/documents that would be required by a commercial company to send such letters. This is different from debt collectors or commercial law firms. If you don't know about Pixsy, you could search it up and it would make the communication regarding this thread much easier.

    Anyways, most part of my questions has been concluded thanks to you and budwad. Unless someone else wants to share a different opinion or information.

    Appreciate your time!

    ...Actually wait one second!

    Quote Quoting pg1067
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    By demanding documentation of the agent's authority to act on behalf of the principal.
    What would be the documentation in this case? The terms of service between copyright's owner and the firm/Pixsy? Considering it's not hidden and in affirmative form as stated by budwad.

  8. #8
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    Default Re: Any Legal Risks Regarding Sending Automated Demand (Threat) Letters

    Quote Quoting mindways
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    What would be the documentation in this case? The terms of service between copyright's owner and the firm/Pixsy?
    The TOS might be part of it, but presumably, if you sign up to use this company's service, you complete some sort of online form or application, and the company will keep a record of that.

  9. #9
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    Default Re: Any Legal Risks Regarding Sending Automated Demand (Threat) Letters

    Quote Quoting pg1067
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    The TOS might be part of it, but presumably, if you sign up to use this company's service, you complete some sort of online form or application, and the company will keep a record of that.


    Alright. Now, I've gained some of the basic understanding regarding this. Thanks.

  10. #10
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    Default Re: Any Legal Risks Regarding Sending Automated Demand (Threat) Letters

    So, my question or rather discussion is about, what sort of legal risks or requirements would be involved doing this sort of procedure? Can anyone commercially send demand letters and take profit from them (just by structuring up their Terms of Service regarding the rights?) Or are there specific requirements that must be fulfilled before one sends such demand letter on behalf on the copyright's owner. Could there be any sort of risk involded?

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