So after reading all this I commented back on the owner's photo stating that I discarded use of the picture which I did, and I never uploaded it online. Am I okay?
I am not a lawyer, but here's my understanding...
Assuming you are working under US copyright rules, then you're probably fine.
There are two ways to get copyright. The expensive way (well... $35. Not *that* expensive) is to "register" the copyright officially. A work where the copyright SHOULD include the copyright notice. It used to be a requirement of a registered copyright. It's no longer a requirement. But failure to include it means the infringer can claim "innocent infringement" which substantially softens the value of the copyright. Nobody would bother to get an officially registered copyright and then NOT fully protect their ability to claim damages by failing to include the copyright notice.
In other words, the work is almost certainly not a "registered" copyright -- but there's no longer a guarantee that it could not be, it's just highly unlikely.
If you officially register the copyright (the expensive way) then the penalties for violating copyright can be much higher. If you merely took a photo, thus having the implied copyright, but didn't bother to go through the registration process... the penalties are much less severe.
In the case of an unregistered copyright, the copyright owner can only collect "actual damages".
Those "actual damages" penalties generally don't allow for more than the collection of whatever reasonable they would have made if the work was legitimately licensed by a client. An artist can really only claim a rate that would be believable. I cannot claim that my work is licensed at $1,000,000 per copy per use... because I've never actually found anyone willing to pay that much. A more realistic fee might be $25... or maybe $50. But probably not more than $100. I do know of a photographer who charges $1000 "per use" of an image. That's on the high side -- and even if they can prove clients have paid that, they may not be able to collect that much because the accused can show evidence that the average licensed via a stock agency is worth far far less per image. The copyright owner has to (a) prove that it really is their work and (b) prove the amount of money that a licensed copy or use of the work is worth. They can then collect that fee. They usually cannot collect additional fees... generally they cannot even collect their legal fees.
This means the cases are in the realm of "small claims court" because the hourly rate to hire a paid attorney would almost certainly exceed what the damages are worth EVEN if it's a lock-tight case that the attorney can't lose.
If they obtain a "registered" copyright, then the game changes... first, they don't need to prove that they own the copyright. The fact that it's a registered work serves as "prima facie" evidence that they own the work (basically it can't be challenged.. it's obvious that they own the copyright.) Second, they can also collect "statutory" damages. That means these are damages allowed under statute or law... rather than merely the "actual damages". That can be up to $30,000 (the judge gets to decide how much.) Third, if they can prove the infringement was "willful" (You knew the work was copyrighted... that didn't stop you, you didn't care.) then the damages can be increased to up to $150,000. There's a counter-side to willful infringement... if the accused party can prove they did NOT know they were infringing a copyright (something that's VERY hard to prove these days) then the judge can decrease the fine to as low as $200. Lastly... the accused also can be made to pay the plaintiffs legal fees (meaning it doesn't even cost the plaintiff anything to sue the accused as long as their copyright is properly registered.) Those legal fees alone can be very very expensive.
The bottom line: You don't ever want to be on the losing end of a "registered" copyright lawsuit. But the damages for an "unregistered" copyright are typically small enough that nobody will bother to sue UNLESS they really are a top photographer would make a lot of money off their work (in which case... they'd be crazy not to register the copyright. It only costs $35 and if each copy really is worth thousands... that's peanuts to pay for the registration.)
The fact that you were honest, discarded the work, never used it in any way in which could possibly have profited or benefited from it, means it wouldn't be worthwhile to pursue a legal complaint and remedy. They'll forgive it... "no harm, no foul."
Regardless, it's just rude to use someone else's work without their express permission one way or another. If you are simply unable to contact them to obtain permission, it's not ok to use a work anyway. Just move on and find something else that you can use with permission.
Finding Creative Commons works are relatively easy:
Suppose I want a background with some mountains in it.
1) Go to Flickr.com
2) In the search box type "mountains" and click search.
3) VERY IMPORTANT... IGNORE THESE INTIAL RESULTS ("These are not the droids you are looking for. Move along.")
4) In the search results, the search box now has a link next to it (which wasn't there initially) labeled "Advanced Search". Click "Advanced Search"
5) Scroll to the bottom. There's a "Creative Commons" section (it looks like the copyright symbol but instead of a circle with one "c" inside... it has two "cc" inside.) Check the box that says "only search within Creative Commons-licensed content" and since you plan to use this to merge as a background into your own work, also click the sub-box that says "find content to modify, adapt, or build upon."
6) Click "Search" again.
It now re-performs the search, but this time all the results are images that you can actually use if you want, PROVIDED you follow the conditions. Pick an image at random. In the right margin of the page is a section that says "License". It'll have some symbols and probably say "Some rights reserved." The the symbols themselves and it'll take you to a page that tells you what they mean. The common symbols are:
- A circle with a little stick-figure person in it. That means "attribution required". In other words you have to tell everyone who took that image. You have to give them credit (even if you modify the work... you should mention how it was modified. E.g. mention that the background is theirs... but maybe you cropped it and also modified the colors or applied an effects filter to it, etc..)
- A circle containing dollar symbol ($) with a line slashed through it. That means "non-commercial". You only have permission to use the image if you will not engage in any commerce. Regardless of how you use the image, there wont be any money, trade, or barter involved.
- A circle with an arrow circling back on itself. That means "share alike". In other words... in the same way that this artist is allowing YOU to use THEIR work without charging you any fee... YOU must in turn pay the favor forward. YOU agree to mark YOUR work as being available for OTHER PEOPLE to use... without any fee.
If you do not agree to all of their terms, then you must contact the owner for permission to use it in the way you had planned (in which case, they may allow it... but they may tell you that you'll have to pay a license fee in order to obtain permission.)
Since you said you only want to use the work for your own private use, that last bit probably wouldn't apply to you. You aren't planning to post the work publicly or sell it or try to get a new copyright on it.
If you do agree to all their terms, then you may download and start using the image. You do not need to contact the owner. You have their permission already because you are abiding by the terms of their license.
