Who: Jason Sheldon and Daybrook House Promotions Limited,
Where: Patents County Court
When: 8 May 2013
Law as stated at: 29 May 2013
What happened:
This recent preliminary hearing in the Patents County Court concerned the potential damages for the unauthorised use of exclusive celebrity photographs in promotional materials. This led to an examination of the principle of “reasonable royalty” whereby damages for copyright infringement can be awarded on the basis of the fees which would have been agreed between a willing licensor and licensee, having regard to the nature of the right and all of the circumstances.
Mr Sheldon is a professional photographer who was granted exclusive access to the tour bus of the American musician Ke$ha. He took a photograph which showed pop artist Ke$ha and LMFAO, an American band, at a backstage party drinking champagne. Mr Sheldon owned the copyright in this photograph.
Daybrook House Promotions Limited (“Daybrook”) subsequently used the photograph, without the consent of Mr Sheldon, to advertise “Floorfiller” events at their “Rock City” dancing venue on 200 posters, 10,000 fliers, online advertisements and Daybrook’s Facebook page.
Mr Sheldon started proceedings to recover the monies he claimed were owed due to Daybrook’s infringement of his copyright.
Reasonable royalties
The preliminary hearing took place for case management reasons. The parties could not agree on the potential damages that could be awarded if Mr Sheldon succeeded at trial. Their suggestions differed so widely that they had a bearing on the allocation of the claim to a track within the court system and affected the prospects for settlement. The damages were to be based on the reasonable royalty principle.
Daybrook said that they expected to spend only around £100 on a licence for use of a similar photograph. However, Mr Sheldon suggested that a bespoke quotation for a photograph of this type would have been in the region of £5,700 and supported this with corroborative material.
Judge Birss QC held that the amount of damages awarded to Mr Sheldon, if he were successful at trial, would be £5,682 plus VAT.
Daybrook’s expectation of a reasonable fee was irrelevant for the purposes of ascertaining that sum.
The judge stated that, “the reasonable royalty is one associated with the use of the particular copyright in question”. He used Mr Sheldon’s quotation estimates when deciding the possible amount of damages. The judge also stressed that the photograph was a result of Mr Sheldon’s exclusive access to famous individuals and that this increased the amount payable as a reasonable royalty.
Authorisation
Daybrook did not dispute their use of the photograph but they argued that they did not know that this use was unauthorised. The photograph had been displayed on Tumblr and Daybrook had mistakenly believed this meant that it could be used freely. As this was a preliminary hearing, the judge did not consider the merits of this argument but it does not appear to have had any bearing on his judgment in relation to possible damages. This argument will undoubtedly be examined in more depth during the full trial on this matter.
Why this matters:
This case highlights the dangers of copyright infringement through the unauthorised use of photographs which have been obtained from social networking websites such as Tumblr.
The amount that the advertiser would expect to pay is not a main consideration in assessing a reasonable royalty fee for copyright.
Damages are specific to each case and will be dependent upon the subject matter and characteristics of the image or photograph.
Advertisers should therefore be especially cautious over using any, potentially, unauthorised photographs containing exclusive images or featuring famous individuals as they are likely to incur high levels of “reasonable royalties”.
