IP Law Daily, COPYRIGHT—D. Colo.: Check your terms and conditions regularly, a court warns, (Mar 13, 2026)

By Matthew Hersh, J.D.

Under California law, users who fail to check for updated terms might well be bound by them.

A photo service that warned its users to check the service regularly for updates could under California law impose updated terms of service upon users who failed to do so in a timely manner, the federal court for the District of Colorado has held. But the court, in finding enforceable against a former user an arbitration clause that was added well after the user ceased using the service, also concluded that the user’s Digital Millennium Copyright Act claim would not be sent to arbitration because it fell within the scope of a carve-out for lawsuits to protect intellectual property (Pierce v. Photobucket, Inc., No. 1:24-cv-03432-PAB-NRN (D. Colo. Mar. 10, 2026)).

The lawsuit was brought by four former users against Photobucket, a photo storage site that reached its peak in the early 2010 but has since lost substantial traffic to such competitors as Smugmug and Flickr. The complaint, which was brought as a class action, alleged that Photobucket was threatening to licensing out images in its database to third parties who would use them to create biometric facial recognition databases or to train artificial intelligence models. The lawsuit alleged violations of the Digital Millennium Copyright Act and leveled complaints under the common law as well as state statutes protecting privacy and consumer rights.

Photobucket moved to compel arbitration over the lawsuit, leading to this opinion.

Standing. The court granted the motion in part and denied it in part. Before addressing the arbitration issue, however, the court had to address Photobucket’s claim that the four class plaintiffs lacked standing to bring the claim. To establish Article III standing, the court noted, a plaintiff must allege they have suffered an injury in fact, that there is a causal connection between the injury and the conduct complained of, and that it is likely that the injury will be redressed by a favorable decision. Photobucket challenged standing on the first ground, contending that the class plaintiffs had not suffered injury in fact. The court disagreed.

The four class plaintiffs adequately alleged an injury in fact, the court found, because they sought injunctive relief to prevent Photobucket from distributing their photos to third parties. While the complaint’s allegations did not show that Photobucket had already distributed plaintiffs’ photos, the court noted, the allegations in the complaint sufficiently alleged, based on statements by Photobucket’s CEO, that the photo hosting service had a “concrete, present plan” to sell photos to third parties that was “imminent.” Moreover, while allegations of future harm—no matter how imminent—are not sufficient on their own to show an injury in fact, the court noted, the class plaintiffs sought declaratory relief to prevent such harm. “A person exposed to a risk of future harm,” the court emphasized, “may pursue forward-looking, injunctive relief to prevent the harm from occurring, at least so long as the risk of harm is sufficiently imminent and substantial.” Standing would not be an obstacle here.

Arbitration clause. The court rendered differing decisions on the enforceability of the arbitration clause for the four different class plaintiffs. None of the four plaintiffs agreed to terms and services containing arbitration clauses when they first signed up for Photobucket services—Photobucket added that clause only in 2024, well after any of the class plaintiffs began using the service. But Photobucket nonetheless argued that the four class plaintiffs assented to the 2024 terms by virtue of obligations imposed on them by terms and conditions in place at the time they signed up. The argument failed in most respects but succeeded in one.

The argument failed with regard to the two plaintiffs who created their account, respectively, in 2008 and 2013. For each of these class plaintiffs, the court noted, the terms and conditions in effect at that time stated that if those plaintiffs continued to use the site after an update to the change in terms, that would be deemed their consent to the updated terms. But the only “use” the two class plaintiffs made after 2024 was to simply leave their old photos up on the Photobucket platform. Under the New York law that governed the 2008 and 2013 terms, the court found, that was not sufficient to constitute “continued use” of the platform. Thus, the two plaintiffs were not bound by the 2024 amended terms.

The result was different, however, for the class plaintiff who signed up in 2006. Under those terms, which contained a choice of law provision designating California as the applicable law, the user was “advised to periodically check the website for changes in the Terms of Service.” Under California law, at least, the court found, that was enough to bind a user to subsequent changes in terms. Those 2006 terms, the court found, quoting from California case law, “necessarily inform[] how a reasonably prudent user would interact” with Photobucket’s website. The 2024 terms, the court concluded, thus “constitute[d] an update to the terms” that the user “had an obligation to stay apprised of.”

Finally, the court found, the arbitration clause did not apply to the fourth class plaintiff because he did not consent to any Photobucket terms and conditions at all. Photos of this fourth user were indeed uploaded (along with photos of his child) to Photobucket in 2006, prior to the 2024 amendment adding the arbitration clause. But the person who uploaded these photos was the fourth user’s wife—not him. Photobucket argued that because his wife uploaded photos of the user and his child, that made him a third-party beneficiary of the agreement. But there was “no indication” in the 2006 terms that either Photobucket or the wife intended to benefit the husband as a third party. Against this user, too, the court concluded, the arbitration clause could not be binding.

DMCA claims. The court also found that even for the one plaintiff who was bound by the arbitration clause, that clause did not require the arbitration of the DMCA claim. The arbitration clause carved out claims arising out of “the actual or threatened infringement, misappropriation or violation of a party’s copyrights, trademarks, trade secrets, patents or other intellectual property rights.” Photobucket argued that the DMCA claims were not subject to this arbitration clause exclusion because a claim DMCA did not constitute a form of “intellectual property rights.” But even if true, the court found, it would not matter. The DMCA, the court noted, prevents the tampering with of copyright management information to the extent that conduct would “induce, enable, facilitate, or conceal an infringement of any right under this title”—including copyright. Thus, to the extent the plaintiffs sought injunctive relief under their DMCA claims, the court reasoned, they did so “to prevent the infringement of their copyrights.” The intellectual property carveout would therefore apply.

Stay of proceedings. Finally, although the court found that the claims would be subject to arbitration only for one of the class plaintiffs, the court also found that it would be appropriate to stay the remainder of the case while that arbitration was underway. “Given the significant overlap between the arbitrable claims and nonarbitrable claims and potential for a preclusive effect,” the court noted, “a stay of this proceeding pending arbitration is warranted.”

The Case is No. 1:24-cv-03432-PAB-NRN.

Judge: Brimmer, P.

Attorneys: Aaron M. Tucek (Loevy & Loevy) for Mac Pierce. James Warren Beard (Merchant & Gould P.C.) for Photobucket, Inc.

Companies: Photobucket, Inc.

Cases: AINews Copyright TechnologyInternet ColoradoNews GCNNews