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In this video, the client was sued for $70,000 for using a copyrighted image placed on the website by the designer. The client then sued the designer, resulting in a messy situation. The video provides tips on how to avoid similar nightmares. The creator emphasizes that they are not a lawyer and are not giving legal advice. They share the contract template used for all web design projects, which can be customized to fit specific needs and legalities. This template provides a solid foundation for creating a contract for web design projects.