Higbee Article: Some Interesting Behind-the-Scene Info

[linoj]

Found this article last night from just a couple days ago:

https://www.fastcompany.com/40494777/here-come-the-copyright-robots-for-hire-with-lawyers-in-tow

"Can the trolls be far behind?" ... seriously? 

[linoj]

"While services like Copypants, Pixsy, and their other rivals don’t appear to fall into that category of so-called copyright trolls, there’s a risk that such operations could start to focus too heavily on lawsuits, using litigation or even the threat of filing a case in court to make alleged infringers settle quickly. “I think these services can fill a needed gap,” says Corynne McSherry, legal director at the Electronic Frontier Foundation. “To the extent that these services become basically settlement machines, that’s where I get worried.” <----- Literally Higbee Associates

[clist]

Very interesting find.

It breaks down the entire system as well as its participants.

I screengrabbed the page for reference purposes.   

I find it funny that the article tries to remain even keeled yet paints Higbee's firm as anything but a copyright troll.   

The bottom line is that the copyright laws need to catch up to the times so that these Extortion letter mills (and their participants) are put out of business.

"first 250 images are free"... GTFOH

[linoj]

Right, almost just a courtesy from the publication. They are being kind to their source, but I think it's obvious Higbee is anything but.

They mentioned "Copypants, Pixsy, and their other rivals don’t appear to fall into that category of so-called copyright trolls" (no mention of Higbee here, lol.) Which then leads into "To the extent that these services become basically settlement machines, that’s where I get worried.” and THEN a whole section on Higbee extortion scheme strategically follows 

[Matthew Chan]

Very good find indeed. I don't think I heard of Copypants before. However, according to the article, it was only 2016 when Copypants and Higbee "partnered" up.

This paragraph is informative. It explains the often-hidden commission split.

In the Higbee firm’s letters, the payment demands to infringers can vary based on a number of factors, with licensing fees ranging between $750 and a “couple hundred thousand dollars,” says Higbee. The firm generally charges Copypants users 50% of any trial award or settlement and charges them nothing if they’re not successful. Copypants gets 10% of the settlement amount as a referral fee, Nicholas Mackenzie, a marketing strategist at the company, said in an email.

Higbee gets 50% of the take with Copypants.  I have always been conservative in my estimation of what lawyers and law firms like Higbee get. I usually say 30%-35% (essentially 1/3) because that is how many contingency agreements work.  But 50% commission for Higbee? Wow.

Let's work through the math. Copypants has a hypothetical $1,000 claim.  But for whatever reason, it escalates to Higbee. He prices it at $5,000 but the target negotiates it down to $2,000.

Using that scenario, Higbee gets a cool 50% off the top ($1,000). Copypants gets their 10% as a "referral fee" which is $200. Those two fees add up to 60% ($1,200).  This leaves 40% ($800) for the photographer/artist.  With the Copypants/Higbee/photographer scenario, it is a 10/50/40 split. Higbee gets the lion's share of the settlement.

And the whole $750 as the "minimum" settlement for Higbee. That is also bogus. I have heard of a few settlements that go below that in some cases.

The article also states:

"Pixsy, with offices in California, Europe, and Australia, works with about 26 different law firms around the world to represent its roughly 22,000 users, says chief operating officer Kain Jones. The company offers similar pricing to Copypants."

There is a nice link to the details of PicScout which Getty Images bought for $20 million in 2011. https://www.bizjournals.com/seattle/blog/techflash/2011/04/getty-images-buys-picscout-for-20m.html

This is another nice informative research paper that I need to read more carefully. It is called "Copyright Infringement in the Market for Digital Images" by Hong Luo and Julie Holland Mortimer. I will probably dissect this paper in a separate post. There are some goodies in this paper.

http://www.hbs.edu/faculty/Publication%20Files/Luo_Hong_J02_Copyright%20Infridgement%20in%20the%20Market%20for%20Digital%20Images_ef25bac9-6125-461d-9adf-9ace58536bcc.pdf

[kingkendall]

Who's to say that Copypants and Higbee aren't the same people?  That's the vibe I get reading this article which I believe is very biased toward copyright trolls. 

They love to accuse people of stealing their property.  Stealing occurs when somebody knowingly takes something that doesn't belong to them.  That's not the case here with the vast majority of these situations. 

The general public thinks if it's on the internet it must be free for all. 

Yes, I understand that ignorance doesn't protect anybody who copies somebody else's work.  But, let's not think that copyright holders aren't taking advantage of the same ignorance by seeing a new business model to rack up some more cash besides what they got from whoever license the work in the first place. 

Copypants reminds me of the same set up credit card companies had with credit counseling services.  Both worked hand in glove to recover money.