Classic misunderstanding that your contract protects you from. Under copyright law, the photographer owns the copyright unless there's a written work-for-hire agreement or assignment. A service contract paying for a photo session does NOT transfer copyright — it grants a license.
Your client breached the license terms by commercializing the photos. Your claims:
- Copyright infringement: Unauthorized commercial distribution. If your photos are registered (or you register now and the infringement continues), statutory damages apply.
- Breach of contract: Violation of the personal-use-only license.
- Unjust enrichment: They profited ($800+) from your copyrighted work without authorization.
Practical approach: Send a demand letter requesting (1) immediate removal from the stock site, (2) an accounting of all licensing fees received, (3) payment of those fees to you plus a reasonable commercial licensing premium. If they refuse, the copyright infringement claim gives you leverage — statutory damages far exceed the $800 they've earned.