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Speculative invoicing or protecting your ipr?

Written by Michael Coyle on 07 March 2015

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Speculative invoicing is in essence the sending of tens of thousands of letters before action demanding payments in the region of £500++++++ the tactic is to scare people into paying the sums by threatening to issue court proceedings. Proceedings are normally never issued. This is often because the economic model for speculative invoicing means that it is more profitable to collect monies from those who pay rather than incur substantial costs in pursuing those who do not pay in court.

I have personal experience of this method of recovering proceedings. Between 2006-2010 I acted for many hundreds probably more of individuals who had received letters threatening legal action for copyright infringement. All the Solicitors responsible were disciplined and it seemed the process was brought to an end. These matters mainly concerned consumers.

Getty Ireland (Getty)

For the last few years Getty continues to send letters threatening legal action. It winds me up as I feel I am benefiting from the process too as I offer the same advice, and send the same denial letter. It’s a game of repeat. I am receiving three to four enquiries a week from web designers, their clients and other companies referring to a letter received from Getty Ireland or its debt collection agents threatening legal action. I charge a minimum sum of £350+VAT.  They usually receive two letters and more threats but as far as I am aware no claims have been issued by Getty.

Whilst I understand the argument concerning court costs surely the correct forum is the small claims court? They could make an example of someone and use this to encourage people to settle.

However there is a big problem for Getty?

Getty is not the owner of the work. It makes this clear in the Letter of Claim. It states it is the exclusive licensee of the copyrights, the maths is quite staggering. Let’s say (and I dont know) 20,000 letters are sent out claiming £495 for each infringement this would still generate about an waful amount of money.

But can an exclusive licensee bring a claim? Well yes but.....we need to see the licence. How can any lawyer advise to settle or defend until such time as the licence is produced?

UK law is contained in the Copyright Designs and Patents Act 1988 ( 'CDPA')

The CDPA 1988 includes the following provisions:
"Exclusive licences
92.(1) In this Part an 'exclusive licence' means a licence in writing signed by on behalf of the copyright owner authorising the licensee to the exclusion of all other persons, including the person granting the licence, to exercise a right which would otherwise be exercisable by the copyright owner.

Provisions as to damages in infringement action
97. …
(2) The court may in an action for infringement of copyright having regard to all the circumstances, and in particular to-
(a) the flagrancy of the infringement, and
(b) any benefit accruing to the defendant by reason of the infringement,
award such additional damages as the justice of the case may require.

Rights and remedies of exclusive licenseee
101.(1) An exclusive licensee has, except against the copyright owner, the same rights and remedies in respect of matters occurring after the grant of the licence as if the licence had been an assignment.
(2) His rights and remedies are concurrent with those of the copyright owner; and references in the relevant provisions of this Part to the copyright owner shall be construed accordingly.

Have arguable wrongs been committed against Getty?

Maybe. Maybe not. Probably. Who knows? Getty NEVER (not in my experience) produces a copy of the licence which allows them to fulfil the requirements for an exclusive licence in section 92(1) CDPA ie so as to give Getty title to sue the intended Defendants for infringement of copyright; so how can anyone advise a Client to settle with Getty if it fails to satisfy the basic requirements under the CDPA.

It stinks.

Its simple;if I had an exclusive licence from someone and a third party uses it without my permission I will sue and when asked to produce the licence, I'll happily do so.

If not, then I'll shurrup!

 

 

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