Unauthorized use of images: companies may have to pay copyright damages

Can a company be ordered to pay for using an image, drawing or artwork without authorization, even if there is no proof of concrete financial loss? According to Brazil’s Superior Court of Justice (STJ), yes. The ruling highlights an important risk for companies that use copyrighted works in products, packaging, advertising campaigns and commercial materials.

The STJ examined a dispute over the unauthorized reproduction of an artistic panel in a line of wallpapers and held that assigning the economic rights does not take away the creators’ ownership of their moral rights in the work. The Court also reaffirmed that damages for material loss arising from copyright infringement do not depend on proof of concrete economic harm.

In the case, the creators of an artistic panel had assigned the economic rights in the work to a company. Later, a company used the design on its products without authorization, giving rise to the lawsuit.

In examining the issue, the STJ stressed that the author’s moral rights, such as claiming authorship and preserving the integrity of the work, are inalienable and cannot be waived. Thus, even if a company receives an assignment of the economic rights, the creators remain entitled to seek protection of their moral rights.

What does this mean for companies?

The first precaution is not to assume that an assignment agreement transfers all rights related to a work. Copyright law distinguishes economic rights from moral rights, and this difference must be considered when drafting and reviewing contracts.

The second point concerns the risk of damages for the improper use of an image or artwork. The STJ reaffirmed that, once copyright infringement is established, compensation for material damages does not require proof of concrete economic harm. The amount may be set later, at the damages assessment stage.

In practice, a company may face an adverse judgment even without being able to identify, right away, a specific financial loss. For this reason, the absence of measurable harm should not be treated as a guarantee that unauthorized use will have no consequences.

Before using images, illustrations, photographs, drawings or other works in products and campaigns, it is important to check who holds the rights, which uses have been authorized and whether the contract covers the intended commercial purpose.

Preventing copyright risks starts before the work is used. Reviewing ownership and the scope of authorizations can prevent disputes, legal costs and damages that affect the company’s operations.