COUNSEL OFFICE OFDISCTPLINARY

WSBA

Felice P. Congalton AssociateDiiector

April 10,2013 Stangarone Joseph RossandCole,Ltd. Michaels, Ste120 Edge, 555Waters IL 60148 Lombard, Re: WSBAFile:13-00400 lawyerLaurenKingston against Your grievance

DearMr. Stangarone: informationdatedApril 4, 2013 from counselfor Ms. Kingston' We receivedthe enclosed of Lawyer Conduct,we are providingthe informationto you Underthe Rulesfor Enforcement of the DisciplinaryBoard. andto a ReviewCommittee

ffiryra
Direct Associate Enclosure
cc: Leland G. Ripley (without enclosure)

Washington State Bar Association . 13254thAvenue, Suite 600 / Seattle,WA 98101-2539 206-727-8207 / emall: caa@wsba'org / fax 206-727'8325

RipleyLawFirm Inc.,P.S. LelandG. RipleSattorney P.O. Box130 Duvall, Washington 98019-0130 email: leland.ripley @comcast.net Telephon e (+zs)37 T-97 37 Facsimile (425)9T4-1542
April 4,2073 ReviewCommittee % Ms. FeliceCongalton 13254th Ave Ste 600 SeattleWA 98101-2539
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APR5 ZO13

V'' Dituii'i,.ii", R-E: Stangarone's Grievance against Joseph AttorneyLauren Kingston, WSBAFile No. 13-00400 DearReview Committee Members: I represent Ms. Kingston. Please directall furthercommunications to me.Before asthis grievant believes. Thi

thisgrievance's merits,.we -u.rl stress thatMs.Kingston,sactions to protect l19l:f:lg herclient's i

for its unlicensed

T::|jipJrigh1ed.i1ages.Ast|e'c9py.right.holdir,'ug.nf,@ugesiscontractually obligated to protecr thosecopyright lioldirs, rightsinciudi ing preventing infringement and requiring copyright infringers to pavfor tleir_gopyright infrilng.*.ntr. thi, grlu.n..
the abilitvto resolve. the Washington lawyer discipline system lacks

Ms- Kingston is anassociate propertyLaw p.S. attorney at McCormack Intellectual Before sheworked for the firm, sheworked for GettyImages's Copyright"Compliance office. LegalBackground Copyr.ight law gives the copyrightownerthe exclusive rightsto do andto authorize, reproduction of the copyrighted work.17U.S.CgroO(a)(1). Alsoundercopyright law,anyone whoviolates anyof the copyright owner,sexclusive

Review Committee %Ms. FeliceCongalton

April+,zot3
Page2 of 6

rights is aninfrin ger.77U.S.C. Copyright lawimposes meaning strictliability, $50r(a). for a findingof liabilityfor infringement. that intentis not required including photographs, lawworks, Undercop.yright automatically receive copyright protection whenthat particular workis created. Copyright infringement occurs when otherthanthe copyright ownerexercises anyone anyof the exclusive rightsto reproduce, publiclyperform, or display distribute, a copyrighted work,or to prepare derivative works work. uponthe original based protects publication, Since a copyright a workwhenit is created, neither nor registration, nor publicnoticeis required before a particular work is protected by copyright. levelof knowledge, or "innocence," A defendant's canonlybeconsidered in a reduction of of statutory damages. 17U.S.C. the amount and $50+(c)(Z) $501(cX2).t As the copyright owner'sagent, is contractually G.tty Images obligated to enforce the holders'rightsagainst infringers. WhenGettyImages infringement discovers it attempts to negotiate a resolution of the infringer's liability. FactualBackground discovered GettyImages that Mr. Stangarone's company Michaels, Ross & ColeLtd., an Illinoiscorporation hadmade unauthorized useof 48 images created by copyright holders whomGettyImages represented. On February L3r2}lzrMs.Kingston sentMr. Stangarone a letterseeking settlement of the infringement for $40,300. Exhibit#1. claims Because the screenshots attached to Exhibit#1 areblack& whitewe havealsoprovided the available colorcopies of some of the screenshots. Exhibit#2. Mr. Stangarone responded with hisMarch7,z}Izletter. Exhibit#3.He told Ms. Kingston that his company hadtemporarily removed the images from the company website yourclaims that these images arelegally represented by "while we investigate GettyImages protection." andsubject to copyright He indicated that he found"no visible copyright notices nor anyindication photos thatthese werethe property of Getty Images." Therefore, before he wouldconduct furtherinvestigation he insisted that Ms. Kingston providehim with evidence that (1)all the photographs wereGettyImages's
I In a casewhere the court finds that the infringer was not awareand had no reasonto believe that his or her acts constitutedan infringement,the court, in its discretion.may reducestatutorydamages.17U.S.C.SsOt(c)(Z).

Committee Review Congalton %Ms.Felice 2013 April4, Page 3 of6 property, wascovered by a registered copyright. Ms. and(2) that eachphotograph her previously never that client images, as has claimed owned the and, Kingston protection attaches copyright whena workis created. discussed, factual withoutspecific for hisclaim,that GettyImages He alsocontended, support "was images available question." those to us at thetime in He threatened complicitin making his "finding" thatGettyImages was that if litigation wasfiled,he wouldpublicize complicit. he offered termsto settleGettyImages's claims. Because he found Finally, the following questioned you internetcopies of photographs to those on our website andin "similar per photo,"he offered for $.99 $10.00 to settleandhave his similarsized available pay"an average ratein that range goaway." to make the problem This offerwas company client. not acceptable to Ms. Kingston's He indicated that if Ms. Kingstoncouldprovethat the photosareboth the propertyof copyrights, his company Getty Images andthat they aresubject to registered would for some legaldirection. consulttheir attorneys meagain in anymanner His letterended with two demands: do not contact over "Please it is to proveyour contentions or accept my offer." He stated that he this matterunless communications to dateharassing ... ." thoughtthat "the toneof [Ms. Kingston's] His second demand was:" [K]eepyourbotsof of mrc'swebsite. We spend a considerable that sitefor customer's, prospects, amount of time andeffortto try to optimize search engines andthe likeanddo not appreciate yourprograms eating at our bandwidth and purposes." His company's computer cycles for yourselfish andmalicious website is available to the public. After her unsuccessful Mr. Stangarone by phone, onJanuary 2Or2Ol3 attempts to contact gq.without Ms. Kingston sentMr. enclosures). Ms. a followup letter.Exhibit asthe exclusive licensor of the images. infringement, Shepointed out that:((Toestablish GettyImages only a claimof copyright the images needs to showthatyouused, copied or displayed withoutauthorization."

Review Committee %Ms. FeliceCongalton

April+,zotl
Page4 of 6

On March 4,2013,Mr.Stangarone replied andclaimed thatthe list Ms. Kingston proved provided that:" fN]oneof these photos arethe property of GettyImages." Exhibit
#).

First he sought" independent verificationthat the image

hasbeen copyright filedwith the U.S.Copyright office."Second, he demanded: "A copy of anyandall documents between Gettyandthe photographer transferring copyright and assigning allrightsin the image to Getty." Finally, he demanded: sales "A complete history, including anychanges in License Type,overtheyears datingbackto at least 2002.Please include license details including image size, duration of use,etc." He gave his opinion that unless Ms. Kingston provided him with the proofhe demanded: cannot consider your claim anything but an attempt at extortion.t) "I Underthe heading: he stated: your failureto heedmy "Repercussions" "Ms. Kingston, requests) leave meno choice but to file complaints with ... Washington State Bar Association listed additional entities but theyareirrelevant to this grievance]...." [he Finallyhe repeated his claimthat he considered Ms. Kingston's claims a "unsubstantiated formof harassment ...." He also complained about GettyImages's review of his publicwebsite. company's GrievanceResponse The same daythathe responded to Ms. Kingston, Mr. Stangarone filed a WSBA grievance. grievance His generally repeats hisclaims about lackof proofof copyright protection andalleged harassment. On March8,2}I3,Associate DirectorCongalton replied to his grievance andtold him: "We reviewed yourgrievance andit appears that yourprimaryconcern is anattempt by a lawyer to collect for a website's useof animage." Shecontinued: that strictliabilityapplies to infringement claims, although "[I]t appears aninnocent infringement mayreduce the amount of damages. Whilethereare professional limit uponwhatlawyers maydo,the available information doesnot indicate thatthese limitswereexceeded.tt On March 14,2073 the WSBAreceived his protest of the dismissal. His protestis based uponhis view,takenfrom Wikipedia,that" Extortion (also called blackmail*, shakedown, zutwrestingand is a criminalffinse of unlawfulfu exaction) prnpe,tJL obtainingmnneJ) 0r

ReviewCommittee %Ms. FeliceCongalton

April+,zott
Page 5 of6

seraices entitJor institutio'n, through (original coercion." emphasis). SinceMr. frornapersun) claims that a litigation Stangarone threatanda possible payment planare" (bothformsof Based uponthis analysis, coercion)." heincorrectly alleges thatMs. Kingston had the crimeof extortion committed andincorrectly concludes that sheviolated RPC8.4(b) His reading andS.a(c). ignores of this definition the essential concept of "unlawfully obtaining." he ignores Since this coreelement of the definition, his characterization of Ms. Kingston's is incorrect. conduct Extortion is: "the actor practice of obtaining something or compelling some action by illegal means asby forceor coercion." BLAcKts re,w DIcrIoNARy, p.664.(9th ed.2077). forbidden by law,unlawful. Id. at "Illegal"means 814. Thusthe coercive actmustitselfbeillegal. Writinglettersseeking to settlea civil claimis not illegal. Criminalcoercion is: "Coercion intended to restrictanother's freedom of actionby (t) threatening to commita criminalactagainst (2) threatening thatperson; to accuse that person (3) of committing a crimel threatening to expose a secret thatwouldeithersubject the victimto hatred, contempt or ridiculeor wouldimpairthe victim'screditor goodwill; or (a)takingor withholding officialaction or causing an officialto takeor withhold action." Id. at 294.Thesedefinitions, provethatMs. Kingston's lettersarenot illegal coercion. Most importantly, Washington lawstates that civil claimsettlement demand lettersare not extortion. Extortionmeans to obtainor attempt to obtainby threat "knowingly property of the owner...."RCW9A.56.110. or services Second degree extortion occurs if anactorcommits extortion by means of a wrongful threatasdefined in RCW 9A.04.110 (2S)(d) (i). RCW9A.56.130(1). through Noneof these subsections make a civilclaim settlement demand lettera ttwrongful" threat.2 Recently the Washington Courtof Appeals affirmed an accomplice's extortion conviction. The courtstated: in satisfaction of a legalclaimis not wrongful "Demandfor payment conduct." State Wn.App.206,218,272P.3d287 u.Strong,l67 (2012). "If a prospective plaintiffthreatening litigation hasor reasonably he or shehasa claimof right,or believes threatens litigationwith a nexus to a plausible claimof right,thethreatfallsoutside the
2First degree extortionis committed whenthe threatis to (1)cause bodilyinjury to the person threatened or any otherpersonor, (2) cause damage to propertyof a person otherthanthe actoror, (3) subject the person threatened or anyotherperson to physical confinement or restraint. RCW9.56.120 andRCW9A.04.110(28Xa)-(c)

Review Committee % Ms. FeliceCongalton

April+,zots
Page 6 of6 scopeof the extortionstatute."Id,.at 279. See also,Statea.Pauling,l49 Wn.2d381,391, U.S. 986 (2003)[crimeof extortiononly involvesthreatsthat 69 P.3d337,cert.denied,54O areinherentlywrongful aslackingany nexusto a claim of right]. requestthat the Review Ms. Kingston neverviolatedthe RPC. We respectfully Committeeaffirm Ms. Congalton'sdismissalofthis grievance.

asindicated Enclosures Cc:Client Exhibits

February 73,z}Lzletter 1. Ms. Kingston's 2. Available colorscreenshots 3.Mr. Stangarone's MarchLr2OT2letter enclosures) 4.Ms. Kingston's 20,2073 letter(without January 5.Mr. Stangarone's March 412013letter

mEcorrnack PrWsff Intallectnal

Businerr Lrr ru
HS
(r17l-ee Street WA 98109USA Seattlc.

o.206-3U1-u8tt8 / f .206.381.1988
'.t norney@lt'lcCo rmackl rgal.com

Lauren A. Kingston Attomey at Law 08 DirectDial:206-330-01

13,2012 February ExPress ViaFederal

Stangarone Mr. Joseph Ross& Cole,Ltd. Michaels, Edge, Suite120 555Waters 60148 Lombard,IL 630.916.0662 Phone: Fax:630.916.0663 E-mail : sales@mrc-productivity.com RE: GeW Imagesv. Michaels,Ross,& ColeLtd. No.943860 Case No. 6109850 Reference DemandAmount: $40.300.00

DearMr. Stangarone: INTRODUCTION McCormack Intellectual Property,P.S. has been retained as legal counselfor Getty Michaels,Ross,& Cole, Ltd. Getty claimsagainst Imagesto pursuecopyright infringement the subjectof copyrightprotectionof the utmostimportanceand hasan active Images considers to progam utilizing a range of measures to deal with the issue.Getty Imagesis committed photographers and enforcement of copyright laws to enswe that both Getty Images and the filmmakers for their work. it represents are compensated asnoticethatvourwebsite: Thisletterserves www.mrc-productivity.com images displayed represented by GettyImages. You havecopiedandusedthese copies of images on your without a valid license.I have attached a report showingproof of the imagesappearing website cease and desistuseof theseimages. You mustimmediately without authorization.

tXrllBlT" 4,i

Page 2

GettyImagesis currentlyinterested in reaching an amicable conclusion to this case. Due use,we havebeenhiredto helpenforce to theextensive all claims. Your actionsas described constitute a violationof the rights of our client in various To avoid any further misunderstanding, I havetakenthe time to explainas clearlyas I respects. can: hasdoneto receive this letter; 1. Whatyour company 2. Why your company's actions areillegal;and 3. How themattermightberesolved. If you wish to avoid further escalation and resolvethis matter immediately,settlement By executingthe settlement instructions are attached. agreement and tenderingpaymentfor the unauthorized use,we canendthematterimmediately. YOUR COMPANY HAS COMMITTED COPYRIGHT INFRINGEMENT To establish a claim of copyright infringement, GettyImages only needs to showthatyou used, copiedor displayed the images withoutauthorization. GettyImages doesnot needto prove thatyou actedknowingly or intentionally. I have attacheda report with screenshotsshowing that your companyhas committed copyright infringement by copyingand displaying the imagesat issueon your website. This means that your company, its offtcers,and otherindividualsinvolvedin the infringement are liablefor damages. As explained below,evenif a third party built your website, your company andothers remainliable for copyrightinfringement damages. YOUR COMPANY IS LIABLE FOR COPYRIGHT INFRINGEMENT EVEN IF OTIIERS ARE ALSO LIABLE Your company is liable for thecopyright infringement notedabove. In civil legalactions, if a wrong is committed, damages may be awarded. Simply owningthe websitecontaining the copyrighted images creates liability for thecompany. Two or morepeoplecanbe liablefor thesame actor actsof copyright infringement. Thisis called'Joint liability." I{.Partieshavejoint liability, then they are eait tiabte up to the full amount of the relevant obligation. Accordingly, one,or the other,or both,infringers canbe sued for thefull amountHereare someexamples *h.t" two or morepeoplehad someform ofjoint liability.

president waspersonally andjointly liable for copyrigirtinfringement occurring when corp p ublished oration cD-RoM disk containing copyrighted photographs.

3 Page parties. Owner of website, infringed copyrights by distributing copyrighted had been photogaphs,even if websiteoperatordid not know that the photographs ontowebsite' uploaded . posted by Thircl Parties. Operatorsof website that contained unauthorized infringement. liablefor copyright vicariously images copyrighted on the the imagesappear is a direct infringerbecause way, yotir company Saidanother that and designer a web hired the company If liable. the company Thii makes website. company In most infringer. direct would also be a that personor company put up the images, designei your company basedon contributory people running to the extends also prrronal liability ,ur.i above. illustrated as liability, andvicarious DAMAGES IN COPYRIGHT INFRINGEMENT CASES In per irnage. can be up to $150,000.00 by the copyrightstatute authorized Darnages feesandcosts. all attorneys' to recover ownermaybe entitled a copyright addition, YOUR COOPERATION WITH THIS INVESTIGATION WILL HELP AVOID LITIGATION with this investigation will helpto avoidlitigation.In orderto amicably Your cooperation we needyou to providethe followinginformation: resolve thismatter, hasceased L A writtenundertaking that your company to usethe imagesidentified in the attached documentation. 2. The dateon which the images werepl4gedon your websiteand to what extent your sitewasaccessed sincethetimetheimages wereplacedthere. 3. What otherwayswerethe images print advertising, used,e.g.,for brochures, etc. andthedistribution of suchuse. 4. An explanation of how you obtained our client'simages. Please provideevidence of this (purchase receipts, deliveryreceipts, etc.). 5 . The identity and correspondence address of any and all other partiesthat might bearliability for the unauthorized useof theimages. 6 . Signed andswornDeclaration is true. thattheabove If it is not possible for you to provideall of therequested information, you mustat least provide the factsof which you haveknowledge. In addition, you mustalsoexplainin a justified and comprehensible mannerwhy it is not possiblefor you to provide further information.After we receivethe aboveinformation, possibleresolution we will then be able to discuss of this

Page 4 note,removalof theimages matter. Please alone this matter. will not resolve If you would like to resolve this matter irnmediatelyin lieu of providing the above information,you will need to: (1) remit paymentin accordance with the paymentinstructions enclosed; and(2) returna signedcopy of the enclosed Instructions for ImmediateSettlement. CONCLI]SION You receivedthis letter becauseyou have committedcopyright infringement of the imagesspecificallynoted. This matter will not go away without further action on yow part. I urgeyou to carefullyconsidermy client's settlement offer. Failureto respondcould resultin the you without furthernotice. filing of a lawsuitagainst Please contactmyoffice within 21 daysof the dateof this letterto discuss resolution..[ look forwardto hearingfrom you.

Sincerely,

q LaurenA. Kingston attorne.v@ Mc Cor mackLeqaLcom Enclosures l. 2. 3. Instructions for ImmediateSettlement Settlement andRelease Agreement Proofof Imagescopied andDisprayed without permission

\,o

INSTRUCTIONSFOR IMMEDIATE SETTLEMENT THIS OFFER EXPIRES THREE WEEKS AFTER THE DATE OF TI{IS LETTER In orderto immediately settlethis matter,you will needto takethefollowing actions: I, SigNANddAtE thE ENclosed SETTLEMENTAND RELEASE AGREEMENT. The paperwork signed canbe faxedbackto my office at206-38I-1988 or mailedto the address notedin Section 4 below. Make paymentin the amountof $40,300(includes $1,000in attomeys'fees)to McCormack IntellectualProperlyPS in care of Getty l.mages. Paymentcan be madeby wire transfer,credit cardauthorization or via checkasper the instructions below. Oncethe signedSETTLEMENTAND RELEASE AGREEMENT is receivedand the fundsverified,we will sendyou a countersignedrelease.The matterwill be closed. Paymentinstructions:

2.

3.

4.

CheckInstructions checks shouldbe madepayable propertypS IoLTA', and to, "McCormackIntellecfual mailedto theaddress below: pS McCormack IntellectualProperty Attn: Getty ImagesSettlements 617Lee Street Seattle, WA 98109

Wire Instructions Bank Kev privateBank -0289 Mailcode: WA-3t -01 I 101PacificAve 2"dFloor Tacoma, WA 98402 propertypS IOLTA McCormackIntellectual 125000574

AccountName: RoutingNumber:

Page2

AccountNumber:

472611012791

Credit Card Instructions providethe following: Please . . . r r NameOn Card Credit CardNumber ExpirationDate CardCode Billing Address

Authorizing Signature

Date

SETTLEMENT AND RELEASE AGREEMENT This Settlementand ReleaseAgreement(the "Agreement"),datedFebruary 13, 2012, is betweenMichaels, as"Company"),and Geffy Images(US), hrc. ("Getty to hereafter & Cole Ltd., aq Illinois corporation(referred Ross, York New corporation, a Images"), l. by Getfy use of imagesdesignated to tle Conrpany's The partieswish to resolvetheir disputewith respect 10159080; 10158134; 10197701: 200021593-001; 10179341 200418489-00\ numbers image as Images 200115742-001;200113937-001; 200A22761-001; 200I 17025-001; 200026954-001; 200141758-A02; 1:0 1 9 6 3 7 3l;O 1 2 8 7 l l ; 2 0 0 5 0 6 5 9 4 - 0 0 1 ; 2;0 0 1 2 3 1 8 8 - 0 01 10 :197222 2;0 0 1 2 0 5 1 6 - 0 01 10 ; 191831 10026030 20o019597-001; 10049372;10a49932; 10187391; 10170278; 200019735-001; ab20569;200016303-001, 200126509-001; 200020242-001;10194757 200023121-004 10125757',200127190-002;l0l50ll3; 200398302-001;200399997-001;6442' 10196029; 200066422-0A\ 200134303-001;200214325-003; -001 85; 200068841 I -001 9995 ; 10I 67106; 403I 8; 829453-001;10 I 86104; 2001 00I 068: 101 ; I 0 I 691 (hereinafter, agree the "Images").The parties 6566-000080c; & 200129860-001 10159078;200462368-001; between of this Agreementservesolely as a settlernent of the amountnotedbelow and execution thatpal.rnent or other an admission of copyright infringement the parties,and is not intendedand doesnot constitute for theuseof theImages. nor approval by GettyImages by theCompany, wrongdoing

in who own, the copyrights the photographers and warrantsthat it owns,or represents 2. Getty Imagesrepresents on behalfof itselfand rightsand authority to enterinto this Agreement andthat it has all necessary theImages, its photographers. rights and authorityto enterinto this Agreement. and warrantsthat it hasall necessary 3. The Companyrepresents and warrantsthat it will makeno furtheruse of the hnageswithout first obtaining The Companyalsorepresents inventory that ir,corporates license; that it will destroy the Imagesor copies thereof; all remaining therequisite the use of the Imagesby, any other andthat it hasnot provided the Imagesto, or in any otherway encouraged clients,end-users and affiliatedentities entity or individual,including,but not limited to, its customers, or individuals. (FortyThousand 4. The Company will remit to GettyLnages the sum of $40,300 ThreeHundredDollars)which includes in attorney's fees.Payment to McCormackIntellectual Property PSon behalf shallbe made $1,000.00 of Getty Imageswithin three weeks of the date of this agreement. Said paynent shall constitutea condition precedent grantedin Paragraph to the release 5 below,suchthat said release shall not take effectunless ard until suchpaymenthasbeenmadein full. 5. In consideration for paymentof the surnnotedin Paragraph 4 above, on behalfof itselfand its Getty Images, photographers, shall expresslyrelease and discharge the Companyfrom any and all claims for copyright infringementin connectionwith the Company'suse of the Images to date on its website www.mrcproductivity.com (the "Released Use"). Tlie partiesexpressly agreethat this releaseis not and shall not be interpreted as a licensefor any ongoingor fuhrreuseby the Companyof intellectualproperty ownedby Cetty Imagesand/orits photographers. Getty lmagesreserves its rights under law to bring legal action for useofthe Imagesin any mannerother than the Released Use,for any unauthorized use of imagesother than the Lnages, andfor any infringementoccuring after the dateof this Agreement. 6. It is the intention of both partiesthat this Agreement is bindingon their principals, successors, agents, assigns andrepresentatives. 7. This agreernent may be signedin counterparts. Fax signahrres shallbe binding in addition to original signatures. Jurisdiction andvenuefor all disputes arising underthisagreelnent shallbe in Seattle, Washington.

initial

Initial

by the parttes' confidence 8. This Agreementshallbe kept in MICHAELS, ROSS, & COLE LTD'

(US)'rNC. GETTY TMAGES By:

Title: Date:

michaels, rctss and cole ltd.

,1,2fi'12 March Ms.Lauren A. Kingsron

l"fcConriack 617 LeeStre-et WA 98i09 Seattle, Re: Yonr Letterof February13,2()12 DearMs.Kingston:

555Waters Edge Suite '120 L o m b a r d , ' l6 L0 1 4 8

We ltave tenlporarily removed the phot0irnilges referpncecl irr ..vour iotterof iielrruaryil, 2012ft''r. 'ur welrsite rvhilewe'investi$iate your eiaimsthatthereiviagssrare legallyreprosented by Getg,Images and subj ectto cclpyriglrt protection,

1l acr{cn OtriND INFORnta FIoN'i

inrc is a sottware co$'pany thatprgclrtces, sells;:ar:il products supports soJlwaro to larger businesses around theworf{, As,stipfir',:e takccopyrightprotscJion ver5. seriously:. We,wouldneverknowinglyviolate itnotiter cofi pany or indiv,idual' s copyri ght. \l|/trIP.T'WENDED: ln 'investigating the photoirnages that you asked ts to.renlove, we"fbund no visiblecopyright notices, nor anyindication that thesephotos were.the properly of;6etg,"[mage,s. So, before Weoango anyfprthel,we you to,provide need usudth evidence than 1. Eachof tire.pho,tos'in question islhe prcperty crfGetly llnages, arrd 2. Eachof the:photos in.question is covered Lr1,a registererl oopyright. HOW THIS COUI.D IIAVE HAI'PENE[,. We arestill investigating ho*' theseirrragos becams a pa.rt,qf sr.Lr published monthlyinten.ret custorner newsletters from 2005till ApLil of 2007. Our policy with that newslengr wasro useonly froepublic photosor irrexpensively domain pfrotos, licensed So far,,itis begirrning to look like your: clierri. O'eiry, lmagr:s, wasoomplicitin making thoseimages T guestit:n. available tOu$4.t thO-tilne Il'l need o,goll.:r,ough in thetirne,fi,,errble, andef,fort to provethatin a courtof law,I will cena.inly wanrto publir:ize thosg firidings. WH.ATWE ARE WILT,IN(; TO DO: if you take a mqmentts loqli s:tthe screerr shotl'\,ou.seut cusionrer you will See of or,rr newsletters, that tiheimages aE rathersmall and low qualitir. Iire;, arethere not-ssa Ii:orrsof an;l article,but simplyto a$d colqr andbreakup the wqr:cls;

eom mrc-p roductivltyt www, Fax630,916.0663 1160148Tet630.916.0662 Sulte120"1-ombard, USoffice 555Water.s.Edge, 83227720 www.mrcuk,com 1 oee Road, Richmond, Surrey, Twg'zJN Tet.ozo UKOffice ArgyleHouse,

"3 *,Hi*IBIT

Page2of2 In 6 quick'internets-barch, I find stock photosqimilarto thoseyouquesfioned on our wsb siteand,in for $.99 - $ 10.00per phOto, We wjll be happyto pay an average similarsizg:availabl,e ratein that.range to rnaketbiSprablgrngo.a1v4y; FleaSeunderstand thst I do not think that we are guilty of anythinghere, but that settlpme. nt,might be a better useof thiq companyls resources than to confinueinvestigating 5 -7 vearsago. something thathappened Ifyou arehappywith this settleinen-t;,please paperworl< sendme:the appropriate and we cantake careof it. IF YOITCHOOSE NOT TO ACCEPT TEI,S OFFER is'howyou canaskfbr fl number What,ldo not understand that is 3 ordersof,magnitude lagger tha4.rhe going,rate for similar photos. And then to tos.F in lpgel feeg ,inyour first,communication well. as To surnup, it i$ not cleqr.tous that tf e ipages arep-r{per:ty of GettylrnageF or that they are subject to copy:1igh1. Ifyouoanpxoveth4tthe'imagese!thetimeofus,e,wsrepropertyo,fGetrylrnagqsandsubj.ecl to registered the4we will needto conSult copyffghts; our attornsys for somglegal direction. Lqstly,I will ask'two thingsof you: ,it is to proveyour l. Fie'asp,do nol sonta0trne dgainin arqy, oyer this matterunless n1-enner cOnteftions o,r'accgptmy offer, I oonsiderthe tone,ofyour corr,rmunioations to dateharassing and ,l wgntno 1ofths1rp&rt of that, and 2. Fleasekeep:your'bots,off of.nucls web,site,We spond a,considerable amountof ti:ne4nd effg4 to :tryto optimizr that site for customers, prospects, searchengines,, andthe like and do not your programseathrgat our bandwidtla appreciate andcornputer cyolesfor your selfishand purposes. malic;ious

,#m
Presidelrt cc: GregGolla- Merchant andGoqld

Sincerely,

January 30,2013 Via FederalExpress

pr Eustness Law

mEcormack property lntallaciuat

Law

617LeeStreet gg10g Seaule,.il7A usA -01 p.20 6- 445 94/ f .20 6.381. 1988 Llga tO tvtc CormactLega t, 'Iimothy B. McCormack
Attotney at Law

Michaels, Ross& Cole, Ltd. attn:Joseph Stangarone 555Waters Edge,Suite120 LornbardIL 60148

RE:

COPYRIGTIT INFRINGEMENT CLAIM Getty_Images v. Michaels,Ross& Cole,Ltd. CaseNo. 943960 DemandAmount: $4g,710.00 Website: htp ://www.mrc_productivity. com

DearMr. Stangarone: Intellectual p.s. has beenretainedas legal counselfor Gettv t"p*;;;;;ryight infringemenfctaimsagainst yorlr company' Further to our last exchange i1us.r of iommunicatiois, r";d;J-;, p-roorof Getty Images' rightsasthe exclusive licensor of the-imaget;l;;;;. As you know from prior correspondence, Mccormack properfy,

To establish a claim of copyrightinfringement, Getty Imagesonly needsto showthatyou -Michaels, rued,copied,or displayed the images ivithoutauthorization. Ross & cole,Ltd. has alreadyreceivedscreenshots. of the imageryas proof of infringement.Getty Images does not needto prove that you.actedftnowingl/oi intentionaily. riris meansthat your company, its officers, andotherindividualsinvoheJin the infringern.nt u.. Huble for damages. As you rnay be aware,there have been several recent de_cisions regardingcopynght infringement that have.generated publicity. In eachoecision, irre infringer was requiredto pay a substantial amountof damages roi inrringrng on copyrighted materiar. copyright infringement is a very serious matter. Getty Images remains willing to settle this claim amicably, if possible.eccoidingly,Gettymrug.r it willing to extend the $48,710.00 settlement offer for an additional 21 days. Fo, ao additi6nal .ny client may be willing to {9", offer a paymentplan if necessary. Getty Loug.r may alsobe willing io .onria., iol inolviduat circumstances in negotiatingthe settlement amount. This offer ir" -"0" *iti"i,i prejudiceto Getly Images' rights and remediesunder copyrightlaw, all of which are expresslyreserved. May I alsosuggest that you reviewthe company businesi insurance for possible coverage asan "advertising injury."

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mEcormack
Law InttllssualPropsrty pi Busines l"aw Thankyou for Youranticipated cooperation in resolvingthis matter. I look forwardto hearing from you promptly-Please contact me to discuss this matterfurther. My directline is: 08. 206-330-01

Sincerely,

LaurenA. Kingston Attorney at Law L auren@.Mc Cormackl epal.com 206-330-0108

Enclosures

michaels, rossand cole: ttd.

fularch 4, 20.l3 Ms.Lauren A. Kingston McCormack 51,7 Lee Str.eet Seattle, WA 98109 Re: Yo-ur Letterof January 30,2013 peai vs. Kingston:

555 Waters Edge Suite 120 Lornbard, lL 60148

your letlerof January I havereceivecl 3Oth. WhileI appreciate the factthatyou haveslightlytoneddown your threatening r'hetoric;.1 find myrself qrriteoorrfused by your definitjorr of prp66f. While I haveasked you to provideproofthatthe photosin questiotr arothe propgrty jr.lst you havedone of Gettyimages, the opposite. You haveprovidedme rvitJr a list of photos inpluding of theactualphotographer thenarne or 'l'his company is proof that noneof these photos thatownseachima$e, aretheproperty of Gottyimages. Proof: You canhai'dly expect nreto takeyour clairn,seriously you slgnyour letters with only that, Since wi[h thetitle ':Attomeyat l-aw", I would expect yort that pr:oof candiffereutiate from claim. Justto make cerlain thatthere,are no.misunderstandings in any Future correspondence hetween us, let me spellout 'irnage whatI mightconsider proof of your allegations, question, ,Foreach in I wilI require:, 1. fndependent verification that the imagecopyright hasbeenfiled with the U.S.copyriglrt office, 2. A copy of any andall d,ocuments between Cettyandthe:photographer fransferring copyr:ight and al1rightsin the irrrage ossigning to Gefty; 3. A complete sales history, including anychangos irrLicense TyDe, overtheyears dating backto at least 2002. Please include Iicense details including image size, duration of use, etc. WithouttheproofI haverequested, I carrnot consider yrur clainranytlring but an attempt at extortion. Settlement withdrartal: I did not noticeany mentiotr in your lettorof my settlemen! offer (madein my letterto you of lvtarch lst, 2012).I wilI presumc this means thnt you andyour,client Brenot interested in that seftlemeut. I hereby lvithdraw thatoffor, Ilarassment: In my lastlette_r, I asked two thingsof you:

t . Please do not contact me againin any manner overthis matterunless it is to proveyour

contentions or accept my offer. Please keepyour botsoff of nrrc'.s web site.

U5Officc 555Watenrfdgs, Suite120 Lombard, lL 60148 Tel630,9i6.066?Fax610,916.0663 www.mrc.productivity.com UKOffice Argyle House, 1 DeeRoad, Richmond, Surrey, TW9ZJN Tel02083ZZ 7720

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a numborof tirnesand then selding your letter you lgnoredthe lirst .rquest, oalling me,atmy offtce. or tQacceptrny offer' was neit}er an attcmptto proveyour contentions 30, 2013'w'hiclr datedlanuary we lave takento warR de,Epite tho digitel measurqs your client,sbots c-onlinue on our networlc tOtrespass to in my last letter lzouaease suih beha.v.ior them.offanddespiterny :gfitten {equest.to Repcrcussions; w.iththe file no ahgicebut to file oomplaints rny'tequosts,leave fin'gSton,your failurgto lree.d. HAsl andthe Kirrg CountyBar Assgoiation, StateBar Assoaia--tion, Bar Association, the Wqqhington Ampi.,iean andthe Seatrtle Bu,reau, the BetterBusiness as well asthe WashingtonStateAttorney.Generalns,OfFtoe; of'Cornmerce. Chamber thingsof yop' I will asktrryo again, OnCe it is to proveyouf this matterun'less in 4nymannerconcerning l. Pilqxe do rrot,contaot,me:trgain proof. I c.onside-r abqvp.ntat I have'delineated orwithdrawYorrr o-!Aim. Qon$titutes cql:ltol,rtions which mqst stop inunecliatly. form.of halassment, olai"nqs,a yoqr unsubstantiated put have the tneasLlres'ws By cireumventing yotrr,oliont's bote offoflmrc,'s'network. keep Z. .Fleas.e Their to orrnetwork, they arecommittlngdigital ffgspass. in plage,tgpreventtheir access is out antl out theft. oycle usage of oW nehngrk CFU' and band.width requeqt will result in flrther action on ,mypart' Your failure to heedtl'1ese Sincerely,

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Fresident
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