Adobe (NASDAQ: ADBE) has a potential liability on their hands if it does not properly warn users of Adobe Photoshop (and others) that when they choose 
"Save for Web and devices..." that they are stripping all of the metadata (including ownership information) from the files, unless they take the action of choosing "Include XMP" within the save dialog box.By removing this information, not only is Adobe (and not just Photoshop, but all their applications) risking being in violation of the DMCA (and subject to criminal and civil penalties) but this extends to international issues of moral rights (a.k.a. droit morale) which, under international law, the removal of this information from creative works is expressly prohibited.
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This has been an issue since 2004, when Adobe, in an effort to assist users with creating the smallest files possible for the web, created this feature, since prior to that, you had to choose to not include previews, thumbnails, and so forth, in the 'file saving" preferences. It wasn't until November of 2007 that a "bug" was noticed in Adobe CS3 and fixed, which moved the 
"Include XMP" to the "fly out menu", which was previously buried in another menu. The problem remains, however, that when choosing "Include XMP", it does not include that same data in the legacy IPTC fields, so if your client is looking for ownership information in the Preview program on a Mac, some PC applications, older version of Photoshop, and so on, the ownership information would not be seen. Since Jeff Sedlik, CEO of the PLUS Coalition, has been working closely with Adobe on metadata and rights issues related to the PLUS standards, we asked him if he was aware of these problems. "I first brought the metadata preservation issue to the attention of Adobe engineers in January of 2005. Specifically, I proposed that Photoshop and other Adobe products should preserve metadata by default, even during a “save for web” operation. Months later, I notified Adobe of a bug related to the Photoshop’s preservation of metadata. In both instances, Adobe was very receptive and promptly acted upon the proposals.” Sedlik noted that Richard Anderson/ASMP, Bill Rosenblatt/Giant Steps and others worked in parallel on the issue.Yet, the integration has not been done to include the ownership in both XMP and IPTC when used in Photoshop, so if you had ownership information in just the IPTC, which would include the many thousands of images you may have saved pre-XMP, there is a potential risk that it would get stripped, unless it was migrated into the XMP as well.
According to the Digital Millennium Copyright Act (DMCA) the operations of Adobe's Photoshop and other applications - specifically take place without informing the user that it is happening - and thus removes “copyright management information” from protected works that have been worked on in Photoshop and saved, including photos and graphical illustrations.
We are going to see more and more issues about ownership of creative content moving forward, and Adobe could well be culpable in DMCA violations. Sedlik reports that he earlier proposed that Adobe display a DMCA warning pop-up when user either turns off the default metadata preservation setting or attempts to edit or delete rights metadata. Sedlik has further proposed to Adobe that “file info” panels should include explanatory text and links to help users to understand the DMCA and the importance of metadata preservation.
Proposals to "lock" metadata are flawed as well. The notion that once any metadata is written is cannot be removed is just like putting a lock on a straw door, it's a false sense of security, as it's very easy to delete or edit any metadata. (John Nack at Adobe answers this on his blog here).
In addition, confirmation of the setting of metadata being included by default should be in plain view , and maintain the copyright and ownership data in both the IPTC (IIM and XMP) and PLUS fields. It's critical that these choices to preserve that metadata shouldn't be so hidden. Frankly, all of the above should be implemented, to ensure the best protection for Adobe and their unknowning customers.
Any argument that the addition of a few hundred bytes of data is going to adversely affect the file size of a JPEG is trumped by the importance of ownership data remaining an integral part of the file as it traverses the internet.
Any argument that Adobe should not be responsible for these issues and contributory infringement need only look to what happens in Adobe when you try to scan in US currency, from Photoshop CS and later. Clearly, Adobe is concerned about liability on currency, so too on the liability of who the owner of the intellectual property that it's applications were used on should be a concern to them.
In January of 2004, when Adobe added this capability, in this AP piece Adobe "acknowledged Friday it quietly added technology to the world's best-known graphics software at the request of government regulators and international bankers to prevent consumers from making copies of the world's major currencies", and quoted Adobe as saying the currency protection technology "would have minimal impact on honest customers." So too would the warnings and default settings have a minimum impact on honest users when it comes to the intellectual property of photographers and illustrators.
This will become a huge problem once whatever form of Orphan Works gets passed, but Adobe needs to be out infront of this issue, and the change of a default setting, or the addition of a warning box could easily be a "dot-release" addition, since it's not a feature, it wouldn't be something that would be subject to the Sarbanes-Oxley Act, (example of the Sarbanes-Oxley issue here), and Carolyn Wright, over at Photo Attorney, notes a cautionary warning here back in 2007.
While I'd make the educated guess that less than 2% of Adobe's customers are photographers, and probably less than 15% of Photoshop users are photographers, these settings, across the board of Adobe's application line, potentially affect all of Adobe's customers both in the liability of creating an Orphaned Work, as well as the DMCA liability of stripping ownership metadata from the images.
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