So I have a buddy that works as a sales rep for a local beer company. Every weekend he attends some type of event with his beer company's beer in a booth. I tagged along to one of these events and took some photos. I gave him permission to post to their private facebook page with credit to me and my website. Fast forward a couple weeks later the company uses one of my photos and adds graphics over it to promote one of their festivals and advertise for people to buy tickets to their event without obtaining a license from me to use. I lack experience in this part of the job and I am curious as to what to do. I want to keep these people as potential clients in the future but also believe I should be appropriately compensated for my work. What should I do?
This may vary by location (especially countries), and for real legal advice you need to contact a qualified attorney, but as general guidance from a non-attorney: Anything posted to a website stands a good chance of being used, whether legal or not. When posting (or allowing someone to post), you can improve your chances of good behavior (even though you have no legal duty to do so) by ensuring that posting also includes a clear statement of your copyright and indication of terms of reuse (e.g. "Posted by permission, reuse prohibited without written permission"). To thieves this means nothing, but honest people may think twice. Visible ownership indications such as a watermark are also reminders (and also not foolproof).
As to how to react to misuse, you can contact the company who is using them, inform them they are using copyright media, and (depending on your preference) demand they stop, insist they pay you, or both. You need to be aware this may come back to your friend who may have misunderstood and gave them permissions, or even if he was not complicit they may blame him in some fashion. In the US for some types of use you can use a "Takedown notice" as provided in the Digital Millennium Copyright Act (just do a search for appropriate forms). Alternatively you could make them aware in some gentle fashion while soliciting further business, more of a "I wish you had asked first, but...and I would love to do more".
It is also worth noting that your Copyright (in the US) does not require registration, but your ability to seek redress and especially damages is much stronger if you did register your Copyright first with the Copyright office. I am not qualified to explain the details, but if you begin to do this in a serious way consider registration before allowing use.
Another aspect of this is that such use is considered commercial (this does not refer to whether you were paid, but that they are using it to promote goods or services, as in advertising). In most venues this may require model releases from those individually identifiable in the photos. This would be more of an issue for the person using them than you, though if you do end up selling a license for them, you may want to ensure you do so fully disclosing "without any model release from any participant" so it cannot come back to you.
Assuming your buddy did as you requested and posted the image to their private Facebook with attribution and link to your website, then the company went ahead and used your image while ignoring the fact that your attribution was clearly indicated. That is, they used your photo without even the appearance of due diligence to get your permission to use your photo.
I want to keep these people as potential clients in the future but also believe I should be appropriately compensated for my work.
These people probably won't be your clients, regardless of what you do. They give the appearance of not caring about attribution, let alone compensation, for graphic assets. Companies that don't understand about paying for graphics will never be potential clients.
If you ignore this transgression, and approach them in the future to sell them new images, they will probably look elsewhere. Or more likely, they'll just have one of their employees or employees' spouse / significant other, who wants the exposure and is willing to work unpaid, take some event or advertising pictures.
If you approach them for compensation for this work they didn't have permission to use, what can you do? You can ask them to stop using your photo. They might comply immediately, or they could drag their feet a bit until the event has come. How far are you willing to press your point? Have an attorney issue a cease-and-desist? It's pretty safe to say they won't be a client in the future in this case.
As others have said, the country you are in matters. If you are in the United States, then you likely own the copyright to your photographs by default, since whoever makes a creative work owns it. If you own the copyright you control multiple aspects of your work including
(1)Who can publish it and where
(2)Who can modify (make derivatives of) your work
(3)If your work can be used for commercial purposes.
You have granted permission for your work to be published, provided that it is attributed to you and your website. Because you granted permission to a business, you may have implicitly given them permission to use it for commercial purposes. You have not (from what you have said) granted permission for your work to be modified or used. As others have also said, talk to an attorney in your area for advice if you choose to proceed legally.
If someone wants to publish or modify a work that you own they must either get permission from you or use it under "Fair Use". You can use the Fair Use Calculator to evaluate the extent to which they might have a fair use claim to your work. From what you said, it sounds like it would be hard for them to argue fair use.
So, if this applies to you, you could pursue legal action, like a cease and desist order. However, as you note that path is not good for business. If you have a friend there, you could explain the situation to him, and ask him to put you in touch with someone who can talk with you about compensation. If you are new to marketing, you might decide to give them the photo in exchange for your being able to claim them as a client in your own marketing materials. You are also in the best position to judge the clients. They may be sloppy and dishonest. They may also be a small business that is new to marketing, in which case they might just need some education on copyright. With the Internet and whatnot, many people assume they are free to use photographs however they want, which is not legally the case in many countries.
To summarize: The extent to which you decide to pursue the matter is up to you, and, assuming you live in the US, your options range from giving them the photo to pursuing legal recourse or compensation if they fail to stop using your photo.
Best of luck with your decision!
First question is local government laws. If in the USA your photos are yours and cannot be used without your discretion, exceptions arise if you are compensated for your time tagging along with expectation of providing the company with photos. If your buddy gave you free beer there's room for interpretation of payment for product.
Second, without some form of written agreement and the scale of the use, you don't have much to go on for suing them. After time and expense, in my opinion, it wouldn't be worth it. But I'm not you and that will not help your rep.
If you want to keep relations with them then you should politely bring it to their attention that they used the photos outside the scope that was agreed upon and either, let it slide this time, or ask for some beer (showing your support and appreciation for the company while obtaining compensation) and state next time you will need to have a written agreement.