A jury has ordered Zillow Group to pay $8.24 million in statutory damages for infringing photo company VHT’s copyright on images displayed on Zillow Digs, according to a Feb. 9 SEC filing.

A jury has ordered Zillow Group to pay $8.24 million in statutory damages for infringing photo company VHT’s copyright on images displayed on Zillow Digs, according to a Feb. 9 Securities and Exchange Commission filing. The digital real estate giant intends to immediately appeal the decision.

The background

VHT filed a federal copyright infringement suit against Zillow Group in July 2015. The photography company alleged that Zillow Group had been stealing tens of thousands of VHT’s photos and illegally using them for its own profit and gain.

The parties squared off on that issue at a Seattle jury trial starting Jan. 23., with the verdict returned Feb. 9. The verdict also awards VHT $79,875 in actual damages, for a total award amount of $8.3 million.

The jury found that Zillow Group failed to prove it could use VHT’s photos either under license or fair use and Zillow Group therefore infringed 28,125 of VHT’s photos, according to the jury verdict form.

Zillow Group responds

“We have persistently maintained our belief that this suit was without merit,” Zillow Group spokeswoman Amanda Woolley said in a statement to Inman.

“While we are pleased that the majority of original claims were dismissed in this case, we regret that the jury did not find for us completely on those that remained, and will vigorously pursue all options to overturn their verdict.”

(In January 2016, VHT filed an amended complaint alleging copyright infringement of VHT’s images on Zillow.com, as well as Zillow Digs. In December 2016, the Court granted a motion for partial summary judgment that dismissed VHT’s claims with respect to Zillow.com.)

Woolley added: “We take copyright protection and enforcement seriously and will continue to respect copyright permissions across our platforms.”

Zillow noted in the SEC filing: “The Company intends to file motions in the district court seeking judgment for the Company on certain claims that are the subject of the verdict, and for a new trial on others.

“We intend to appeal any judgment that the court may enter on the verdict to the extent the district court does not set it aside as a result of these motions. The Company is seeking coverage from its insurance carrier for reimbursement of all recoverable legal expenses and any damages underlying the verdict that are not vacated.”

Zillow Group’s insurance carrier — National Union Fire Insurance Company of Pittsburgh, PA — has filed a federal lawsuit to avoid paying Zillow Group’s legal expenses related to the VHT case and Zillow Group has filed a counterclaim. Both companies allege breach of contract.

Judge James L. Robart, who presided over the VHT case, is also presiding over this insurance dispute. (Incidentally, Judge Robart is also the federal judge who blocked President Donald Trump’s immigration ban on Feb. 3 — right in the middle of the VHT trial.)

VHT responds

VHT retains copyright for all photos taken by photographers on its behalf. It licenses the photos to listing agents and brokers solely for marketing the specific pictured property or the company or agent representing the property — and only while that property is on the market.

“VHT Studios welcomes the jury’s decision, which protects the interests of real estate photographers and their clients,” said Brian Balduf, VHT’s CEO and co-founder, in an emailed statement.

“Throughout this long and arduous process to uphold our copyright protections, the VHT Studios team has been proud to take the lead on this important issue.

“We look forward to continuing to work with our team of nationwide photographers, as well as our industry counterparts, to create a rights management organization to ensure that all real estate photographs are managed properly and protected against unlicensed uses.”

VHT did not name any brokers or MLSs as defendants in this case, but that’s not to say that they should consider themselves off the hook in the future.

“[I]f the brokers or MLSs are purporting to license these photos to Zillow after the listings go off-market, VHT might also have claims against them; but it may view it as strategically unwise to make such claims,” attorneys Brian Larson and Mitchell Skinner wrote in their 2016 book Real Estate Listings & Copyright.

This case highlights how real estate agents and brokers may want to keep track of what happens to the photos they send to portal giant Zillow — and the terms under which they are sent.

Editor’s note: This story has been updated with a statement from VHT, details from the jury verdict form, and information related to a lawsuit filed by Zillow Group’s insurance carrier.

Email Caroline Feeney

Inman Deputy Editor Andrea V. Brambila contributed to reporting to this story. 

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