CafePress goes copyright crazy

June 4, 2003 3:40 PM

New user agreement means customers lose copyright. CafePress has long been the independent's way of printing up a few pithy slogans, or customizing small orders of apparel. But the new TOS now assigns exclusive, royalty-free rights to publish, display and gain trademark registration for the customers items. (Oh, they also now charge a 5% fee out of your commission and are "withholding fees for taxes" and oh, did I mention the new $25.00 a month "administrative fee"?) Have they just shot their business model in the foot?
posted by dejah420 (27 comments total)

What other solutions are available for the vanity shirt producers? Someone recommended Zazzle, but I've not had any experiences with them, good or bad. What other sites/businesses would you recommend?
posted by dejah420 at 3:43 PM on June 4, 2003

That's not what it says. Read it again.
posted by chuq at 3:45 PM on June 4, 2003

The license sounds scary until you read the next sentence: "If you or CafePress.com terminate your account, CafePress.com will cease its use of the Party Marks within 90 days of the termination." As I read it, the trademarks they are referring to registering are the CafePress marks, not trademarks on artwork from their customers.

The 5% transaction fee and the $25 minimum bother me as a Cafepress seller. If they need more money they should adjust the base price of their products. These moves certainly don't further a warm relationship with the community they built around their service. Are there any similarly priced alternatives?
posted by neuroshred at 3:52 PM on June 4, 2003

Dejah did you bother to actually read what it says? Here is the actual text :

6.2 You hereby grant to CafePress.com a royalty-free, worldwide, nonexclusive, right and license to use the trademarks, trade names, designs, logos and other images that you upload to your image basket in connection with your use of the CafePress.com Service ("Party Marks"). If you or CafePress.com terminate your account, CafePress.com will cease its use of the Party Marks within 90 days of the termination.

For the layman, this means that if you put stuff on their site for sale you are granting them a freebie redistribution license. This only makes sense, they cant promote your stuff for you if they cant show it to anyone. Which is what the license agreement is for.

I skimmed it and didn't see anything about you losing your copyright to your stuff.
posted by MrLint at 4:04 PM on June 4, 2003

So the "exclusive" part of the FPP is wrong, you just give them free use of your images for 3 months. But other than that, their license suddenly got a whole lot more restrictive.
posted by spazzm at 4:11 PM on June 4, 2003

I shut down all my stores 'cause of the fees, not because of the image copyright thing. I make about $3 a year off of my shirts. That $25 fee is going to kill me.
posted by Katemonkey at 4:13 PM on June 4, 2003

They actually have clarification about the copyright issue on the site. It's in a javascript popup so I can't link to it, but this is what it says, in part:

There is some mis-information spreading that we are taking over and stealing everyones content. So we want to clarify and make sure everyone understands that this is absolutely NOT TRUE. We know that the language of lawyers (legalese) is indeed foreign to most of us - so we would like do a step by step explanation on clauses 6.1 - 6.3. Please let us know if anyone has any questions!

6.1 ...
This clause basically states that CafePress owns the rights to the Web site and service - and that we have the right to register and protect the trademarks and copyrights to our service. This clause has nothing to do with the content provided by our members.

6.2 ...
This clause gives us the rights we need to produce and ship the items you want to sell through our service. You give us a royalty-free and non-exclusive right - which means we don't pay a licensing fee for the artwork/content and our agreement is non-exclusive. This clause points out you are the owner of your trademarks, names, designs and logos.

6.3 ...
We run ads and promotions to drive traffic to our member's stores - and when we do so and promote your store - we have to credit you as the owner of your artwork. The last line specifically says "CafePress.com will not represent ownership of any of your designs."

We hope this better explains our Intellectual Property policies. If you have any questions, please email [e-mail]

But I also closed my shop due to the $25 fee.
posted by xeney at 4:17 PM on June 4, 2003

I knew it was going to happen sooner or later, especially after what I saw happen to mp3.com and others. Closed mine because of the fee as well (I wasn't making half that a month, but wasn't really trying to).
posted by phylum sinter at 4:33 PM on June 4, 2003

I think MrLint is correct that the intent of the agreement is probably to allow CafePress to "promote your stuff for you."

Nevertheless, this seems ambiguously written:
You hereby grant to CafePress.com a royalty-free, worldwide, nonexclusive, right and license to use the trademarks, trade names, designs, logos and other images that you upload to your image basket in connection with your use of the CafePress.com Service ("Party Marks").

I wonder what the clause "in connection with your use of the CafePress.com Service" is supposed to modify? If it restricts the "license to use," then I think the agreement is pretty reasonable. That is, CafePress can only use your Party Marks in connection with your use of CafePress. Fine.

However, if it restricts the "trademarks, tradenames, [etc.]", then CafePress is saying they have a license to use any marks that you upload to CafePress. The problem with this is that there is nothing in the agreement that protects you from CafePress abusing the marks. For instance, CafePress can open a 'competing' store that sells merchandise with your marks, without compensating you. They can take your artwork and print it on their new line of sex toys, and they don't have to ask you first. If you don't like it, your only recourse is to terminate your account. Even then, CafePress could continue to use the mark for nearly three months.

Of course, it wouldn't make much sense for CafePress to open stores competing with its users. And I suspect my dream of purchasing MetaFilter sex toys will remain a dream. Still, the agreement gives a lot of power to CafePress.

Anybody have a link to the agreement before this one?
posted by blue mustard at 4:34 PM on June 4, 2003

As someone who has a store or two on CafePress, I'd jump ship in a heartbeat if there were any good alternatives available. Does anyone know of any? I'd like mugs, at least; those make great gifts (and are a few steps classier than T-shirts).
posted by wanderingmind at 4:40 PM on June 4, 2003

MrLint, dude, no reason to get all snarky about the place, ok? You have nothing to prove, we're all in awe of your tremendous brain power.{southpark} (our penises are *so* small in comparison to yours...). {/southpark}

And on preview, I interpreted it the same way that blue mustard suggested. Forgive me for not understanding the minutia of legalese...but I'd like to point out that enough people didn't understand the first version (now MIA and replaced with the one you quoted) of their new user agreement that they've modified to read as it currently does...and they've added more explanations of it.

All of which has no bearing on their new fee structure which, at it's core, is enough reason to warn all the MeFi cafepress users that this is in the pipeline.
posted by dejah420 at 4:44 PM on June 4, 2003

Here's the previous agreement. (Or actually, the current agreement, since the new one doesn't go into effect until July.)

The previous section 6.2 says almost the same thing as the new one, except it uses language that more strongly limits what CafePress can do with your marks:
You hereby grant to CafePress.com a non-exclusive, royalty-free right, during the term of this Agreement, to utilize your existing trademarks, trade names, designs and logos (collectively referred to as "Party Marks") in connection with the advertising, promotion, production and sale of the products and services you choose to sell in accordance with this Agreement.
posted by blue mustard at 4:48 PM on June 4, 2003

I also closed up my shop just now (crikey, I apparently actually sold some stuff to someone sometime - I hadn't logged into it in like 6 months....), but mostly due to the requirement to provide tax details for the American tax department. I'm not American. They can go sex up a rolling doughnut.
posted by stavrosthewonderchicken at 5:07 PM on June 4, 2003

...to utilize your existing trademarks, trade names, designs and logos...

That is misleading, scary, and would have sent me over the edge as easily as it did dejah. How can CafePress reconcile that with the second version? Glad I didn't get into CafePress and then get hit with the new fee, too. I was close. *sigh*
posted by Shane at 5:07 PM on June 4, 2003

Re: the $25 charge per month: It's simple. If you notice you've made less than $25 over 180 days with your products, close out your shop before your 180 days are up. That way, the only amount you lose (per section 5.6) is the <$25 sum you've accrued. Then just open up a new shop with a different name and do it again. You won't make any money, but then if you were making less than $25 over 180 days, then chances are you weren't really making any real money anyway, not in the least because Cafe Press doesn't actually mail checks until you reach a $25 threshold in the first place.

One other solution: Pick the cheapest item on the Cafe Press product list (the oval sticker is $1.99), create it and give it a price of $28 over the base price ($28 to cover the 5% commission and still be over the $25 minimum). Once every five months and two weeks, buy it for yourself. The $28 will come back to you (minus Cafe Press commission and shipping costs), so you're only out the cost of the Cafe Press cut and the shipping -- say $5 - $6. So essentially you'd be paying $1/month rent to Cafe Press. That seems reasonable.

I don't think Cafe Press is shooting itself in the foot with this policy. It's getting rid of the accounts that are not adding to its bottom line to concentrate on the accounts that are actually doing business. The folks who are using Cafe Press as a legitimate part of their business and that that have a decent amount of traffic ($25 over 180 days equals a profit of $4.17 a month) will not be affected by this at all.
posted by jscalzi at 5:50 PM on June 4, 2003

There is no "monthly fee".

This is not unlike when banks charge you an "inactive account fee" to zero out an idle account. They're trying to get rid of commission balances that never trigger a payment threshold.

In other words, if you are like me and have a balance under $25, they're basically going to charge that balance to an administrative fee to get your balance down to zero. If you can ring up more than $25 in commission before the six months is up, you'll get your check. If you can't, they'll essentially "reset the counter" on you.

I don't mind losing the $5 in my account balance that comes from purchases I made myself. It's not "real" money to me in the first place.
posted by briank at 6:17 PM on June 4, 2003

I'm more pissed about the changes to the Referral program:

Until June 30: You earn money each time a product is sold from a referred store. The amount earned is based on the referral tier a sale comes from (Tier 1 - 50 cents; Tier 2 - 25 cents; Tier 3 - 15 cents; Tier 4 - 10 cents).

July 1 and on: You earn 5% of the base price for each product sold by a referred member. For example, if you refer a friend and they sell five white t-shirts in the first month, you will earn $3.49 (5% of $13.99 x 5 t-shirts).
posted by elvissinatra at 7:01 PM on June 4, 2003

T-Shirt Candy Dot Com have been toying with an affiliate program idea for a while.

For now, though, they're still damn hot to play with.
posted by armoured-ant at 7:03 PM on June 4, 2003

I've been involved in discussion with many store owners as well as cafepress people and some clarifications have taken place. I'll try to express them here as best I can, but don't take this as gospel.

The copyright issue they were referring to are images created 'by the cafepress service' - this means that when you upload an image for a shirt, for instance, cafepress servers make a thumbnail image of that image on a t-shirt. Since THAT image was created through cafepress, they want it to be used only to promote your store at cafepress. Again, as others have said, this is not about losing copyright on your designs, just on the derivative image. The cp people agreed that their wording was not entirely clear on this one.

About the 5%.... many people use cafepress for fund-raising. i.e., they mark up a bumper sticker $100 to collect club fees, with the sticker being the receipt. This causes cp a lot more in processing costs. The group of storeowners I know have discussed other options/solutions for this problem, since their chosen solution is affecting EVERYONE, not just people with a large markup, and they are considering alternatives to this structure.

The pricing tier structure.... It used to be based on number of items instead of amount of sales. This worked well for them at first when they only had 8 products. But when they started adding cheaper products like bumper stickers, someone could buy 20 of them cheaply and still get the tier discount. So instead, the tier discount is about $250 which is based on sales from 20 shirts, their most popular item. The thing about THAT that most store owners object to then, isn't the item to amount shift as much as the fact that after you get to $250 in sales NOW, you only get rewards on the amount AFTER that, not on all of it. We've registered our preferences with cafepress about that as well.

I haven't looked into the referral program differences as much so won't comment on those.

If you'd like to investigate this further, you can stop by the Cafepress store owner's forums here (run by cafepress) - check under 'general help' - there's a lot of general outrage and lots of misunderstandings at first, but also a lot of clarifications later on in threads.
posted by thunder at 7:53 PM on June 4, 2003

Oh, and this too.. briank wrote: This is not unlike when banks charge you an "inactive account fee" to zero out an idle account. They're trying to get rid of commission balances that never trigger a payment threshold. The CP people we talked with said they had about ten THOUSAND accounts with little piddly commissions in them, which is an accounting nightmare for them. They are trying to clear out the dead accounts, to be sure. (Not that this was necessarily the best way to do it, but they weren't trying to be malicious or greedy by doing this.)
posted by thunder at 8:00 PM on June 4, 2003

Update.... if you go to the cafepress forums, the discussions have been moved to their own section: "Member Agreement/Privacy Policy Discussions".
posted by thunder at 8:23 PM on June 4, 2003

I didn't interpret Mr Lint to be snarky. As one of the many lay persons he mentions, I couldn't read through the agreement and make decisive heads or tails. He wasn't the only poster who mentions the misrepresentation of this post.
posted by G_Ask at 8:44 PM on June 4, 2003

I myself was taken aback at the updated TOS. At first. Bottom line though, it does make sense. The more they've grown, the more they need to adjust. jscalzi, briank and thunder explain it best and I agree with them.

I myself have used CP's service, it's been beneficial (some have) and others not so. But I've watched them grow over the years (as many of us likely have) and can understand their need to revisit how they function and to maintain profit.
posted by bluedaniel at 11:10 PM on June 4, 2003

From what I can tell, if you're making and selling t-shirts with no profit, you can keep doing so for free. I make t-shirts for my friends, for special events, etc. I charge the base price, so I've never made a commission. Apparently, I can keep doing that--there's not a $25 monthly fee.

I see this more as a failure of PR than an abandonment of a business model. They should have anticipated the misunderstandings and written their new terms of service and accompanying announcements/press releases accordingly. The new terms make good busines sense, but the are (obviously, from the reaction) very unclear.
posted by MrMoonPie at 6:22 AM on June 5, 2003

CafePress' Clarification on Section 5.2 and Clarification on Section 5.5.
posted by elvissinatra at 9:22 AM on June 5, 2003

Oops. Wrong link, I meant: and Clarification on Section 5.5.
posted by elvissinatra at 9:27 AM on June 5, 2003

Barry Smith, of the online comic Angst Technology, offers his take on this and his options under the June 5th entry.
posted by given2fli at 11:52 PM on June 5, 2003