Last week, a popular YouTube business coach posted a now viral video about an issue that had occurred last year involving a few customers of Creative Fabrica (CF) being threatened with legal action for IP infringement on the use of an item they had downloaded from the site.
And I want to clarify a few things.
THE BACK STORY
The details of how the infringement came to be weren’t made very clear, but it seems that maybe someone was selling something on CF that they didn’t have the rights to sell and the original artist subsequently came after everyone using their design without a legit license.
Unfortunately, it seems the original IP owner was intent on using the maximum legal force to attack the supposed infringers and the customers in question received letters from a lawyer representing the artist demanding a hefty settlement sum or else they would proceed with court action.
The customer's of CF were justifiably upset but it didn't sound like the individuals being discussed in the video actually obtained their own legal advice to help deal with the matter properly.
THE CONVERSATION
Instead of focusing on the infringement details and legal risks associated with marketplace assets, the dialogue focused almost entirely around Creative Fabrica’s licensing and the terms of service on their site.
An accusation was presented that CF was offering a commercial use license while denying any liability for issues with items downloaded from the site. In short, if a copyright infringement exists within any product on the site - CF is not legally liable for that.
What resulted from this video post was absolute outrage from viewers with CF. Specifically that they were perpetrating a scam by selling memberships to the site while advertising a commercial use license, but not offering assurance that ALL products were free from copyright issues.
Yikes. There's a lot to unpack here, and you're not going to like it.
FIRST, EMPATHY
I want to first say that I can totally understand that customers finding themselves in a sticky legal situation would be panicked, outraged and wanting some support from the platform in question. Having purchased something in good faith only to find out later the graphics had been copied or stolen is not a fun situation to be in. And could be potentially costly.
Naturally, emotions would be running in high gear. I get that.
UNCOMFORTABLE FACTS
Unfortunately, blaming CF for not ensuring all products in their marketplace are free from any infringement is simply naive and outside the realm of reality.
Let me make something very clear… Creative Fabrica is a marketplace. They do not own the material sold on their site and they do not own or control the copyrights to member generated content. They operate in very much the same way as any other marketplace, and have very similar terms as any other digital marketplace. (more on that later)
Copyright can be extremely complex, difficult to identify accurately, often requires extensive research to determine ownership and would necessitate an educated background in copyright law to properly assign any copyright ownership. In the end, under existing copyright law, only the IP holder can claim infringement, and if disputed, only a court of law has the power to settle the disagreement when parties can’t resolve it between themselves.
I hate to be the bearer of bad news, but this scenario exists on virtually every single platform where user generated content is uploaded. Every single digital marketplace site out there has the same type of terms as CF and absolutely will NOT accept the liability for products on their site. Whether you buy products individually or via a membership the liability of usage will always lie with the customer. And it has been this way from the beginning, this isn't something new.
This issue is simply not a CF only issue. It’s just how things work. If you, the customer, buy digital assets to use within products you sell… you are liable for the use of that content. If a legal problem arises your recourse is with the individual seller of that item, not the platform where you purchased it from.
SUPPORT FROM CREATIVE FABRICA
Part of the dialogue around this situation included lashing out at CF for not providing more support, both legally and financially when they were contacted about the problem. A certain amount of outrage was felt that the company was not prepared to do anything more than remove the problematic content and refund membership fees to the upset customers.
This highly emotional reaction is understandable, but entirely misplaced. It’s an idealistic utopian mindset of society being filled with morally ethical companies that will make right any situation at any cost to them simply for the sake of being the ‘good guy’. Well that would be nice wouldn’t it?!
Instead, we live in a society where companies do only what is required of them within the law and shun any liability they are not directly responsible for. This is modern day capitalism, love it or hate it. Why would a company risk their bottom line and future viability for the actions of a third party? Would YOU?
And just to re-iterate the point - CF is no different in this aspect than any of the other digital marketplaces or for that matter any online platform.
PROOF OF RISK
I feel like I can't make this point strongly enough. Every single marketplace has the same type of terms and Creative Fabrica is not doing something different. No marketplace platform is going to offer you legal advice or support nor financial compensation.
To prove my point I offer screenshots of the terms in question from two other sites as a comparison.
First, here is the fine print in question from Creative Fabrica.
By comparison, Design Bundles has the same terms but worded very differently. While they don't use the word 'non-infringement' their terms amount to the same thing, they are not going to be held liable for member generated content. Here is an excerpt from their terms:
And here are the warranty terms from Creative Market. Theirs is written in legalese so it might be harder to understand however, the meaning of their terms is again, not liable for member generated content on the site.
THE RISKS
A sensible question to ask at this point would be - how risky is it to use digital assets from CF? Or any other marketplace? In my own opinion, as both a buyer and seller on both DB and CF, the risk is fairly low. Not zero, but low. It’s definitely a lot better than shopping on Etsy these days where scammers are plentiful! Etsy has no moderation for infringing content while CF and DB have some.
Sellers have to apply to sell on CF and they do look over your portfolio to determine if you are a good fit. (I was denied a seller account in 2023 but invited to join in 2024 when my own product selection was more up to date). I assume they look at the type of content you create and deny anyone who is overtly infringing with trademarks since those are easier to spot.
They also do moderate the content to some extent ensuring that the most obvious infringing content doesn’t get posted. This is mainly done around trademark elements which is an easier type of content to moderate accurately along with maybe any themes they might wish to exclude.
As mentioned above, copyright is a tricky subject and it is simply not possible to moderate for that.
A few comments were made on the video post about CF monitoring and removing copyright infringement, but this is not any easy task, nor is it lawful. As I already mentioned, the law on copyright ownership makes it so that only the copyright holder can claim infringement. It would violate an artists rights if someone inserted their opinions on the issue.
Additionally, because copyrightable work does not have to be registered to qualify for copyright status and because copyrighted work can be licensed on any kind of license terms - it would be impossible to know who owns what and/or who has the right to usage. Copyright law is just simply that complex.
RUNNING A BUSINESS
CF has been popular for some time amongst many types of business owners and the above information has many viewers of this outrage video concerned enough to question whether they should continue their CF subscription. And that is a fair position to consider.
Running any business involves a series of risks. As a business owner you are liable for everything your business does and/or produces. Part of running a business means reading the fine print on the terms of service for any supplier or service you use, and making a determination on whether it’s a good fit for you. In this case, it might not be.
For this particular situation my advice is, buyer beware. Do your research. Know who you are buying from. Gain an understanding of copyright law and how it works. Know the terms (all the terms!) of the site you are buying from. And do proceed with some caution.
If, like the customers in this story, you do end up being threatened with a lawsuit for copyright infringement there are a few key steps to take, especially if you are the victim of being sold a license by the wrong party:
1. Don’t take action or make decisions while in an emotionally heightened state. Calm down and gather your wits together before doing anything rash.
2. Gather all information relating to the situation and do any necessary research to fill in missing info. Receipts, screenshots, any other proof you might have, and exactly know who is making the claim against you.
3. Determine for yourself, as well as you can, where the wrong doing exists. Have you actually done something wrong? Who has? Are you an unwitting victim? Is the work in question registered with the copyright office? Is the work even eligible for copyright protection? You may need assistance to answer these, but having this information will help in the next step.
4. If you can, and you should, do seek legal counsel. Provide all your information and be able to explain the situation accurately. Then you can proceed as advised.
4. If you can’t obtain legal counsel and feel the need to handle it yourself, try to get some advice from a support group so you have different perspectives other than just your own limited experience.
5. Reply to the legal counsel who has contacted you to negotiate. Settlement offers are negotiable and are often presented with the hope that you’ll just pay without dispute. Depending on the circumstances you might be able to negotiate a much more agreeable outcome.
IN CONCLUSION
Creative Fabrica could be criticized for many things, but trying to hold them accountable for the bad behavior of a creator on their platform is only possible if they turn a blind eye and knowingly allow infringing content. Which is something they don’t seem to be doing. To be knowingly allowing something to continue they have to have been informed by the copyright holder that an infringement is taking place. Remember, only the copyright owner can legally make such a claim.
If at any point you have concerns about content on any digital marketplace you should reach out to the site to let them know. Creative Fabrica has a very responsive customer support team. If you are not the copyright holder but see something you can identify as belonging to a different artist, reach out to that artist directly to let them know, most people appreciate you having their back, even if the situation ends up being totally ok.
If you have any questions or concerns on this topic, just hit reply, I'm happy to respond!
Shawnna
0 comments