Most important points

• A copyright infringement occurs when someone uses a copyrighted work without the consent of the copyright holder – e.g. copies, distributes, makes publicly accessible or edits – and no legal permission applies.

• Typical cases: Music and film piracy, unauthorized use of photos from the Internet, copying of texts or graphics, file sharing of protected content. Sharing protected content on social media can also constitute an infringement if it is not covered by the right to quote or other exceptions.

• Consequences: The rights holder is entitled to an injunction (the infringer must stop further distribution) and often to compensation. In Germany, a warning letter is often issued first – this is an out-of-court request to stop the infringement, submit a cease-and-desist declaration and usually pay costs.

• Damages can be calculated according to various methods, e.g. lost profit of the author or usual license fees (so-called license analogy). In the case of images, for example, there are tables (MFM) that provide guide prices that can then be claimed.

• Copyright infringements can also be punishable by law (in Germany, for example, § 106 UrhG ff.), especially on a commercial scale. However, this rarely leads to criminal proceedings; it usually remains in the civil law area with warnings.

• Startups and content creators must be careful not to use third-party content without authorization: e.g. do not simply place Google images on the website, do not copy texts from competitors. It is safest to either create content yourself, use free licenses (e.g. Creative Commons) or purchase a license.

• Just as important: protect your own work from infringement. If you discover that your software has been pirated or your photos stolen, for example, you can respond with a warning letter and legal action. Good documentation of your own authorship (project files, originals) helps in the event of a dispute.

When is something protected by copyright?

In order to understand what constitutes copyright infringement, it is necessary to clarify what is protected in the first place. In principle, every literary, scientific and artistic work enjoys protection as soon as it is created, provided it is a creative work of one’s own (Section 2 UrhG). This means that texts, images, pieces of music, films, software code, but also database structures or applied art, for example, can be protected by copyright.

Important: There is no obligation to register or mark the work – the copyright arises automatically with the author (creator) upon completion of the work. Therefore, you can also unknowingly commit an infringement because you may think “There is no ©, so I can use it”. This is a common fallacy: a missing copyright symbol does not mean “free to use”.

Example: Someone writes an informative article in a blog. This text is probably a personal intellectual creation and therefore protected. If someone else copies this article onto their own website, this constitutes copyright infringement unless the author has given permission.

Typical copyright infringements in everyday digital life

• Image theft: Someone googles an image and uses it for their own online store or social media post. This is a classic. The vast majority of images on the internet are protected. Only if they are expressly released (e.g. public domain/CC0 or own works), or you have licensed them (bought from picture agencies, permission from the photographer), is it allowed. Otherwise: clear infringement.

• Copying texts: Copying complete texts (or large parts of them) from other sites into your own imprint, product descriptions or blog posts is also critical. Even if a product is the same, you must not simply copy the competitor’s description 1:1.

• Music and videos: The use of protected music in your own videos (without a license or GEMA coverage) is a common trap on YouTube & Co. Re-uploading film clips etc. without permission is also an infringement.

• File sharing/downloads: Anyone who downloads the latest films or albums via file-sharing platforms (BitTorrent etc.) often distributes parts of them at the same time and thus commits a copyright infringement. As a result, many people who download via such platforms receive warnings from law firms representing copyright holders.

• Software piracy: The unauthorized use of software (e.g. cracks without a license) is also a copyright infringement. Companies may be subject to license checks; if it is discovered that, for example, 10 Photoshop installations have been used without a valid license, there is a risk of subsequent licensing requirements and possibly contractual penalties.

Rights of the author in case of infringement

If your own work is used without authorization, the author or rights holder (this can also be a publisher or producer who holds the rights) has various claims:

• Injunction: The most important aspect is often to stop further distribution. Injunctive relief serves this purpose. In a warning letter, the infringer is asked to sign a cease-and-desist declaration with a penalty clause. In doing so, he undertakes to refrain from infringing in the future – a contractual penalty would be due in the event of non-compliance. This is how the rights holder protects himself.

• Removal/destruction: In the case of physical infringements (e.g. pirated copies of books, unauthorized CD copies for sale), the destruction of the illegally produced reproductions can also be demanded. In the online area, this corresponds, for example, to the deletion of files, removal of a photocopy from a website, etc.

• Damages: The infringer should compensate the damage caused by the use. It is often difficult to quantify this, which is why the license analogy has become established: The question is, what would the infringer have had to pay if he had properly acquired a license to use? This sum is demanded. In the case of photos, for example, the MFM table (an industry index for image fees) is often used. In addition, compensation for warning costs and legal fees can be demanded in the event of culpable infringement.

• Information: In some cases, the author does not even know how extensive the infringement is. He can request information from the infringer, e.g. about sources of supply, distribution channels, profits made, etc., in order to determine the damage and other parties involved.

Example: A photographer discovers that his photo is being used on three different websites without a license. He has a lawyer send a warning letter to all three operators. Among other things, he demands an injunction (the image must be taken down), information (since when online, how often used, perhaps who was the supplier), and then compensation in the form of a fictitious fee plus a surcharge because his name was not mentioned (in the case of images, a 100% surcharge is often demanded if the author’s name is missing, as this represents an additional breach of duty).

Warning letter – curse and blessing

The warning letter is omnipresent in copyright law. For many, it sounds negative because warnings are sent out en masse, especially in cases such as file sharing, and are sometimes criticized as a “business model”. However, the warning letter is actually intended by the legislator (Section 97a UrhG) as a means of reaching an out-of-court settlement. It gives the infringer the chance to settle the matter without going to court by stopping the unauthorized act, promising to refrain from future infringements and reimbursing the rights holder for certain costs.

For some years now, there have been regulations against abuse (capping of lawyers’ fees in simple cases with a private background in order to curb “mass warnings”). Nevertheless, this remains the case: If you are caught, you usually have to react, otherwise it can go to court, where it quickly becomes more expensive.

For a company that receives a warning letter, this means: take it seriously, but don’t panic. Check (or have checked) whether the accusation is true. If so, it is usually better to submit the requested cease-and-desist declaration – modified if necessary – so that there is peace and quiet, and pay the costs. If not, or if the claims seem completely exaggerated, seek legal advice and reject them if necessary. Simply ignoring them is often the worst option, as an injunction or legal action could follow.

Criminal law aspects

The Copyright Act makes some acts of infringement punishable (Sections 106 ff. UrhG). However, the threshold for criminal proceedings is high: in most cases, the infringement must be on a “commercial scale” or the infringer has stubbornly continued after receiving a warning. In everyday life, you rarely have to deal with the police because of a stolen image on your homepage. Nevertheless, in serious cases (professional bootleg factories, large-scale piracy, even the operation of illegal streaming portals), law enforcement officers will take action. For the normal startup, it is more relevant to act criminally , to offer commercially protected content.

Another side issue is the liability of platforms: Those who enable users to upload content (YouTube, forums, etc.) have long been subject to the discussion of the extent to which they are jointly liable for copyright infringements by their users. Currently in the EU (keyword “upload filter”, Article 17 DSM Directive), it is becoming apparent that large platforms must take preventive measures to prevent copyright infringements caused by user uploads. For small start-up platforms, however, there are some relaxations. Nevertheless, anyone planning such a business model should follow the developments surrounding copyright service provider liability closely. In any case, there should be a mechanism in place to quickly remove reported infringements (notice-and-takedown).

Prevention for start-ups

Of course, it is best to avoid copyright infringements from the outset – both as the infringer and as the injured party.

As a potential infringer:

• Train employees on what they are allowed to use. Do not simply take an image from Google. It is better to use license-free resources (stock photo services, Creative Commons with careful checking) or create your own material.

• License software properly, do not resort to illegal copies for “cost reasons” – this can be very expensive at the latest at the first audit.

• With social media content: Be careful when sharing other people’s pictures. Platforms such as Facebook have their own rules, but many things remain legally unclear. Memes and the like are often in a gray area (in the USA there is fair use, in Germany sometimes the right to quote, parody, etc., but this is risky). If in doubt, ask or do without.

As the rights holder:

• If content is the capital of the start-up (e.g. a photo community, a software tool, a blog), you should actively monitor whether third parties are using the material without permission. Tools such as Google Image Search (search backwards) help to track down your own images on the web. There are also professional services that check texts or code for plagiarism, for example.

• React consistently but proportionately to infringements. A polite tip to a small blogger can sometimes be enough instead of immediately sending a lawyer. In the case of clear commercial exploitation, however, it is best to make use of your own rights – ultimately this also protects the legitimacy of the business model.

• Contracts with employees and service providers stipulate that all rights to created works are transferred to the company (keyword “employee copyright” – by default, even employed developers remain the author of their code, you have to obtain rights of use contractually, usually this happens in employment contracts).

Conclusion

A copyright infringement can range from a supposedly trivial case (a copied photo) to a content theft worth millions – in any case, the matter should be taken seriously. Copyright law protects creatives, and infringements are actively pursued in Germany, often with civil law warnings. For start-ups, this applies twice: on the one hand, they creatively use third-party services (e.g. in marketing, software development – pay attention to licenses here), on the other hand, they create content themselves that they want to protect. If you know your rights and obligations, you can avoid disputes and financial damage. If in doubt, it is better to obtain permission beforehand than to ask for forgiveness afterwards – because the latter is often expensive.