I have been reading up on 'public domain vs copyright law' ever since imageprotect.com *tried* to extort money from me. They basically demanded $6000 ($1500 for 4 copyrighted images) which our members posted. Recently, another $1500 was demanded for another celeb pic.
Ever since the demise of our favourite belly forums, I have been fascinated with copyright law in different countries and EU which saved me from a potentially expensive lawsuit. Legally you have to respond to all copyright notices so if Imagebam.com had to deal with this crap on a daily basis, I can see why they would just simply seize to exist.