How to Not Get Sued When Dropshipping

How to not get sued when dropshipping - winner picker

 If you are just starting your dropshipping business you probably feel a bit overwhelmed with all the information you get and all the preparation you need. There are so many things to take care of. Somehow, although it may sound strange, many people don’t even start to think about legal things like getting sued. It isn’t out of any bad intention, it just doesn’t cross their mind. The other reason is that they quite often lack the right information about what is (il)legal in certain countries. 


Hopefully, we will shed some light on this topic and help you take better steps in making sure you are playing by the rules. So, let’s start.


Importance of a business license

Using copyrighted images or videos

How to tell which image is copyrighted

Selling trademarked products

How to get visual material for your dropshipping store


Importance of a Business License


Although a business license isn’t a must for a dropshipping store, it is definitely good to have it. 


In case you are sued and you don’t have a business license you can lose your personal property and your bank account.


What business license enables you is to have your online shop registered as an entity of its own. This way, your personal property is safe in case somebody sues you.


It goes without saying that each country has its own regulations and options so it would be wise to get all the information from your local accountant, tax advisor, lawyer. You would definitely get a clearer picture.


Another perk of having a business license is the message that it sends to your prospects. It shouts out that you do take your business seriously, which would make you more credible and trustworthy.


Using Copyrighted Images or Videos


According to Investopedia, copyright means that “the original creators of products and anyone they give authorization to are the only ones with the exclusive right to reproduce the work”. 


Copyright infringement is quite a serious violation of the law. In the US, for example, the original owner of copyrighted material “can be entitled to damages worth $750 to $30,000 for every infringement. Additionally, if the copyright owner proves that infringement was intentional, you may end up paying $150,000 for every infringement.”


A big part of the problem is that dropshipping is an international business and, as it’s already been mentioned, different countries have different regulations. The most notorious when it comes to copyright is China. It isn’t the most notorious because it has strict laws about copyrighting, but actually, quite the opposite. Truth be told, many Chinese companies have started to align their business with international standards, but many still don’t think much about protecting the rights of an individual. Just remember all the identical product images you get to see on sites like Aliexpress. It is almost impossible to find the original owner.


Although you might not have problems with Chinese authorities, it is always good to check a supplier first and see if they are licensed to sell. The chance that a Chinese company would sue you is extremely small, they would rather sue the manufacturer, but for your ease of mind, making inquiries first might just do the trick. 


Although you aren’t a lawyer, you will definitely benefit a lot from learning a bit about Copyrighting Law. Just learn a few essential things.


Now that you’ve armed yourself with some basic knowledge let’s tackle another common issue: how to tell which image is copyrighted.


How to tell Which Image is Copyrighted


Let’s start with the most obvious one: the copyright sign ©.  If there isn’t a sign, then the copyright holder’s name or website may be visible on or under the image.


Unfortunately, for many images and videos, you can’t see copyright ownership at all! That still doesn’t mean it is free for you to use them. According to the Law, the copyright symbol doesn’t have to be displayed. Not only is original work automatically protected but it also remains protected long after a creator passed away.


Images with watermarks


Other types of images that you might come across are pictures with watermarks.

image watermark example - winner picker

Images with watermarks


You might be surprised how many people think that they would just use some cool software program, delete the watermark, and problem solved. Kids, don’t try this at home is all I will say. Seriously, don’t do that. You are putting everything at risk. In a court of law, your action means that you intended to infringe upon the copyrighted image. That is much worse than trying to pretend you didn’t know if the image was copyrighted. The fines will cost you dearly.


Luckily, there are some ways that can help you determine if the image is copyrighted or not:


  • You can ask a supplier directly 
  • You can try to find the copyright holder’s name
  • The US Copyright website that we already mentioned a few times comes in handy, too. You can either search for images yourself or you can pay and they will do the work for you. We tried typing the word “mug” and this is what we’ve got.

Before we move on to the ways you can get images safely and for free, the next item is also worth mentioning: 


Selling Trademarked Products


You should really stay away from selling trademarked products. I know it might seem confusing because you do see trademarked products being sold on Aliexpress. But truth be told, they also don’t have the right to sell those products/images. They are counting on the fact that since they are in China, the US Law won’t apply. This doesn’t mean that you should be encouraged to do the same. Our advice would be the same as for the copyrighted images: 


  • Ask the supplier first. You need to be sure because you are just starting your business and building it on the right foundation is pretty much a must.
  • You can also buy the products legally from a licensed, accredited distributor.
  • Try using online resources like Trademarkia, which may be able to help you to do a trademark search.


How to get Visual Material for Your Dropshipping Store?


One of the first steps is ( you know this by now) to ask your supplier. If you get the green light, great. But don’t immediately rush to post the visual material. You should ask for written proof of their statement, so-called proof of authorization. Don’t forget to store it in a safe place in case you might need it later.


There are some other methods that you could use:


  • DIY method

Since it is a good idea to order some test products yourself, use this opportunity to kill two birds with one stone. When you get the products, just take a few photos yourself. Get some extra help from many free editing apps such as Canva for example. This might also give your products that extra kick because you might create something more original, new, and more eye-catching.


  • Websites where you can find copyright-free visual material

There are some websites like Pixabay, Shutterstock, Pexels, Unsplash, just to name a few where you can find really nice royalty-free photos/videos.

example of royalty free images - winner picker

Copyright-free images Shutterstock


  • Use Google Images Search

Naturally, the first step is to click on Settings at the bottom of the Google page:

google image search example

Google images


Then, you should click on Advanced Search. After this step, you should type in what you’re searching for. 

google image search - advanced settings - winner picker

Advanced image search


The next thing on the agenda is to scroll down to Usage rights and select “free to use, share or modify, even commercially.” And of course, then just click on Advanced Search.

google advanced search - winner picker

Advanced Search


In addition, if you want to find the original source of the image and double-check copyrights, then reading a bit more on Reverse Image Tools might just be your cup of tea.


 One of the most important things to realize is that there are real options for every budget to make sure you get copyright-free images or videos.


I am quite sure you got a bit wiser on this topic after reading the previous lines. Although it may sound daunting, in reality, all you need is a bit of patience, investing knowledge, and time with legal representatives to make sure you get all the information. It takes time for sure, but once you’ve done it you can rest assured that you are growing your business in the right direction from a legal point of view. And that peace of mind is priceless.


Yes, you can steal images and sell trademarked products, of course, you can. But is it really worth it? Apart from risking getting sued and paying hefty fines, you are risking something even more valuable, something that isn’t that easy to rebuild once it is destroyed: your reputation.