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The client was sued for $70,000 for a copyrighted image on the website, which the designer had placed. The client then sued the designer, resulting in a messy situation. The video shares tips to avoid such nightmares. The creator is not a lawyer and not giving legal advice. They share their web design contract template for guidance. It's recommended to consult an attorney for legal advice and make necessary adjustments to the contract template for a solid foundation.