It looks like Pictage was sued, and settled out of court, because they are using digital images to sell products in a shopping cart online.
Um. That seems like a tough patent to try and protect, but someone successfully did it. What companies (and photographers) are next? They sued several photographers along with Pictage.
Here’s the letter from Pictage:
Dear Valued Pictage Partner:
Last week Pictage completed a settlement of a patent infringement lawsuit brought against Pictage and some of our clients by VPS, LLC. Among other things, VPS’s patents cover the online display of digital images and sale of products based on those digital images. VPS has licensed these patents extensively and requires that companies (including professional photographers) providing online sales of products based on online digital images pay VPS a license fee or royalty on all such online sales.
As part of the settlement with VPS, Pictage is paying a multi-million dollar fee for a license covering past and future online sales on Pictage.com. All of your past sales and those you will make in the future on Pictage.com are covered by the license to Pictage and the fees paid by Pictage. However, it is important to note that any sales that you have made or will make on any other website (including your own) are not covered by the license to Pictage.
The fees that we are paying VPS make it impossible for Pictage to continue to honor our legacy commission rate of 10%. Effective immediately, our commission rate will be 15% of online consumer sales. Those currently at 15% will see no change. In addition, we will now charge a monthly fee of 1.5% (still substantially below the best available credit card processing rates) for all sales made though our Pictage Payment Processing (P3) system.
I thank you again for your ongoing support. If you have any questions, comments or concerns please feel free to contact me.
Best regards,
Jason B. Kiefer
Founder & CEO
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