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I believe Google tags content with date, and after that, duped content on other sites is recognized (somehow) and discounted (in some way).
Don't think you are at risk.
This is based on both what I've read in WW, and experience we've had on both sides of the content fence. For what it's worth.
Following that theory, it is them who will be penalised, and that page removed from the index. So no detrimental effects to you :)
If you leave it as it is you should be OK get traffic from them and no penalty, of course i could be totally wrong, but it seems logical. :)
Practically what we do is allow people who ask to copy our content is to allow them to copy up to 10% or max 200 words whatever is smallest, with a link back to the page they took it from with a few other conditions.. e.g. they cant have the same "title" as our page. They must acknoeldge the source. We conourage them to "review" the whole content rather than just plonk it on a page.
To us this seems sensible for both users and google. There is really absolutely no reason to have the same content repeated more than once on any page on the web, but quoting some as a reference to the original should not be enough to either waste browsers time of upset the Google deity.
I think there will be various opinions on your question PD, but im a conservative type and thats what we do. Why give them everything anyway? They just want the rich keyword stuff i guess, and having read the whole article on their site, why go to yours?
To us this seems sensible for both users and google. There is really absolutely no reason to have the same content repeated more than once on any page on the web, but quoting some as a reference to the original should not be enough to either waste browsers time of upset the Google deity.