i must say it was an amusing variation on the stolen images theme.
this site had stolen one of my images (not hotlinked, but taken and put on their server) underneath the image it said: Image Stolen from example.com and example.com was deep linked to the page on my site where the image appeared!
as it happens on my sites i have 2 types of images, one where i'm ok if people hotlink as long as they give a link (i don't advertise this - but i do check back) ... and the other where the images are photos that are hard work for me, these i'm much more protective of. this one was in the former category.
anyway, i was quite astonished at their blatant ripping off!
I found something similar once. While testing a then-new feature of image search I fed in a picture from one of my pages. The ultimate source was an e-book whose printed original is in the public domain. Looking more closely at one hit, I found their image captioned "from Handbook of Widgets by John Kilroy. Used by permission." I really, really wanted to write and ask-- in the spirit of polite inquiry-- how they contrived to get the permission of someone who died in 1877.