Ts & Cs
Anyone posting photo's to Flickr loses their right to be outraged. I've gone to sign up several times since it launched, and every time I read the Ts & Cs I changed my mind and told all my friends to avoid them like the plague. Partly because they explicitly state they can and will do things like this...
The real question here is - can the people in the photos take action against the muppets who uploaded their image to a site which had that in the Ts & Cs?