The exclusive legal right, given to an originator or an assignee to print, publish, perform, film, or record literary, artistic, or musical material, and to authorize others to do the same.

Above: Plaintiff Chuck Close.
__________________

The Ninth Circuit has pending before it for the second time a significant challenge to the validity of the California Resale Royalty Act (“CRRA”) stemming from three related cases: Sam Francis Foundation v. Christie’s, Inc., Case No. 16-56235 (9th Cir. notice of appeal filed Aug. 26, 2016); Chuck Close v. Sotheby’s, Inc., Case No. 16-56234 (9th Cir. notice of appeal filed Aug. 26, 2016); and Sam Francis Foundation v. eBay Inc., Case No. 16-56252 (9th Cir. notice of appeal filed Aug. 26, 2016).

These cases will require the Ninth Circuit to examine the scope of the “first sale doctrine” and determine whether it is at odds with California’s attempt to establish economic rights for visual artists on subsequent sales of their works.

I.  Doctrinal Background

A. The CCRA

California enacted the CRRA in 1976 for the purpose of offering visual artists similar financial protections to artists in other media.1  The California statute codifies droit de suite (literally, “a right to follow”), which provides visual artists with a royalty each time one of their works is resold.2  The rationale, at least in part, is that visual artists are often disadvantaged by a time-lag between a work’s initial sale and the ultimate realization of that work’s value.3

To combat this perceived inequity, section 986(a) of the CRRA provides that, subject to certain limitations, “[w]henever a work of fine art is sold and the seller resides in California or the sale takes place in California, the seller or the seller’s agent shall pay to the artist of such work of fine art or to such artist’s agent 5 percent of the amount of such sale.”4

Notwithstanding several attempts by members of the United States Congress to enact federal resale royalty legislation,5 the CRRA represents the only U.S. codification of such a right at present.6  Nevertheless, droit de suite has been codified in several jurisdictions outside the U.S., including France, England and Australia.7

B. The First Sale Doctrine

Section 109(a) of the Copyright Act of 1976 enacts what is widely known as the “first sale doctrine.”8  Under the first sale doctrine, the lawful owner of a copyrighted work is entitled to dispose of his or her ownership in that property without acquiring the permission of the copyright owner.9  “[O]nce a work has been sold, the copyright owner has no further right to control the resale of the work, and the new owner is free to dispose of the work as he or she chooses.”10  As a matter of policy, the first sale doctrine is an embodiment of the rule against restraints on alienation, a central tenet of property law from time immemorial.11  The question raised by these cases is whether a resale royalty requirement imposes such a restraint on alienation of copyrighted works of art.

II.  Procedural Background

In 2011, plaintiffs The Sam Francis Foundation, the Estate of Robert Graham, Chuck Close and Laddie John Dill together filed putative class action lawsuits against each of Christie’s, Inc., Sotheby’s, Inc. and eBay, Inc., alleging “the willful and systematic violation by [each defendant] of its California law obligation [under the CRRA] to pay royalties to U.S. artists and their estates on artworks sold either in California or at auction by California sellers.”12

The defendants moved to dismiss, articulating several bases for the invalidity of the CRRA, including that the CRRA violated the Commerce Clause of the U.S. Constitution, violated the Takings Clause of the Fifth Amendment, and was preempted by the Copyright Act of 1976.13  In 2012, the Central District of California granted dismissal on the sole basis that the CRRA violated the dormant Commerce Clause by “controlling commerce ‘occurring wholly outside the boundaries’ of California even though it may have some ‘effects within the State.’”14

In June 2012, the plaintiffs appealed the Central District’s order. In 2015, sitting en banc, the Ninth Circuit concluded that, while the CRRA “facially violates” the dormant Commerce Clause insofar as it regulates the sale of fine art taking place outside the state of California, “the offending provision [of the CRRA] is severable from the remainder of the Act.”15  Thus, the CRRA remained valid as to in-state sales of fine art.16  Since the district court had ruled that the CRRA as a whole was invalid, the Ninth Circuit remanded for a determination on the defendants’ alternative grounds for dismissal.

On February 1, 2016, the defendants submitted a second round of motions to dismiss, largely renewing their previously-submitted bases for dismissal.17  In an April 2016 order granting the defendants’ motions to dismiss, the Central District of California held that the CRRA was invalid as preempted by federal copyright law.18  The court determined that the CRRA conflicted with the intent of Congress, which had demonstrated its desire to “keep downstream sales of copyrighted works [ ] free from restrictions imposed by copyright holders” when it enacted section 109(a).19  The court also found that the CRRA was expressly preempted by section 301(a) of the Copyright Act of 1976, which dictates that the rights contained in section 106 of the 1976 Act are the “exclusive rights of copyright holders.”20  This order is the decision from which the current appeals stem.

III.  Current Challenge to the CRRA

Critical to the arguments articulated in both parties’ appellate briefs lies one crucial sub-issue: how broadly the first sale doctrine should be interpreted.

Relying on the Ninth Circuit’s 1980 Morseburg decision, the plaintiffs contend in their opening brief that the district court erred in finding a conflict between the CRRA and the Copyright Act of 1976:  “The first sale doctrine prevents copyright holders from prohibiting or controlling downstream distribution of copyrighted works. . . .  It has nothing to do with the right of copyright holders to possess a financial interest in the proceeds of a sale.”21  The plaintiffs reiterate this argument in speaking to the district court’s determination that the CRRA was expressly preempted by section 301(a) of the 1976 Act, arguing that the CRRA does not create an “equivalent” right to those provided for in section 106; therefore, section 301(a) does not apply.22

In contrast, the defendants favor an expansive reading of the first sale doctrine in their answering brief. “Under the first sale doctrine, once a visual artist sells artwork, the artist loses the ability to interfere with future sales.”23  In support of this interpretation, the defendants look to Supreme Court and Ninth Circuit precedent addressing the first sale doctrine:  Kirtsaeng, Quality King, and Omega v. Costco.24  The defendants rely on these decisions for the proposition that the loss of the copyright holder’s exclusive right to control distribution of a work of art after its initial sale should be read to include a loss of the copyright holder’s ability to profit from subsequent sales.25  In other words, the defendants argue that “the Copyright Act intends [downstream resale transactions of works of fine art] to be unrestricted.”26

Addressing these arguments, the plaintiffs’ reply brief focuses on the Supreme Court’s recent Lexmark decision.27  In that patent case, the Supreme Court considered the scope of the “exhaustion doctrine,” which is essentially the patent law analog of the first sale doctrine.28  The CRRA plaintiffs’ reply brief cites dicta from the Supreme Court’s Lexmark opinion standing for the proposition that contract rights and patent rights exist side by side, and that while the sale of a product may extinguish the patent holder’s patent rights, it does not terminate the rights preserved by the patent holder in contract.29  Extrapolating from the Court’s rationale, and transposing it from the context of patent law to that of copyright law, the CRRA plaintiffs argue that, just as contract entitlements endure despite the first sale doctrine, statutory entitlements like the CRRA should not be terminated by the first sale of a copyrighted work.30

The CRRA plaintiffs’ reliance on Lexmark is particularly intriguing, given that the opinion also includes rhetoric that the CRRA defendants pointed to in support of their position – e.g., Chief Justice Roberts’s comment that “extending [intellectual property] rights beyond the first sale would clog the channels of commerce.”31  In any event, it will be interesting to see whether the Ninth Circuit applies Lexmark in determining these cases – and if so, to whose benefit.

IV.  Looking Forward

Despite the Ninth Circuit’s previous holding as to the in-state-only applicability of the CRRA, the Ninth Circuit’s decision on the current appeals has potential implications reaching beyond California’s borders. If the Ninth Circuit decides in favor of the plaintiffs, holding that the CRRA is not preempted by the Copyright Act of 1976, it may inspire other states to enact similar legislation codifying droit de suite. If the defendants prevail, and the CRRA is struck down, it may re-ignite interest in a federal codification of droit de suite that amends the first sale doctrine.

__________________
1. See Anna J. Mitran, Note, Royalties Too?: Exploring Resale Royalties for New Media Art, 101 Cornell L. Rev. 1349, 1354 (2016); John E. McInerney III, California Resale Royalties Act: Private Sector Enforcement, 19 U.S.F. L. Rev. 1, 5 (1984).
2. See David E. Shipley, Droit de Suite, Copyright’s First Sale Doctrine and Preemption of State Law, 39 Hasting Commnc’s & Enter. L. J. 1, 2 (2017).
3. See McInerney, supra note 1, at 5; Mitran, supra note 1, at 1354.
4. Cal. Civ. Code § 986(a).  As discussed further below, the Ninth Circuit has ruled that the language “the seller resides in California or” facially violates the dormant Commerce Clause and should be read out of the statue. See infra nn.15–16 & accompanying text.
5. See Mitran, supra note 1, at 1363.
6. See Shipley, supra note 2, at 7; see also Droit de Suite: The Artist’s Resale Royalty, December 1992, A Report of the Register of Copyrights, 75 (“[Since the CRRA was enacted, d]roit de suite legislation has been introduced in Connecticut, Florida, Illinois, Iowa, Maine, Michigan, Nebraska, New York, Ohio, Rhode Island, and Texas.  To date, none has become state law.”).
7. See generally Herbert Lazerow, Art Resale Royalty Options, 63 J. COPYRIGHT SOC’Y 201 (2016).
8. See 17 U.S.C. § 109(a).
9. See McInerney, supra note 1, at 5; Shipley, supra note 2, at 2.
10. McInerney, supra note 1, at 17 n.110.  This entitlement of the new owner to resell the copyrighted work does not affect ownership of the copyright in that work.  Thus, the copyright holder’s rights and the new owner’s rights coexist within the same framework, without conflict with one another. Id.
11. See Kimberley Byer, Note, The Death of the First Sale Doctrine, 11 J. on Telecomm. & High Tech. L. 389, 392 (2013).
12. Complaint ¶ 1, Sam Francis Found. v. Christie’s, Inc., No. 11-08605-MWF-FFM (C.D. Cal. Oct. 18, 2011), ECF No. 1; Complaint ¶ 1, Estate of Robert Graham v. Sotheby’s, Inc., No. 11-08604-MWF-FFM (C.D. Cal. Oct. 18, 2011), ECF No. 1; Complaint ¶ 1, Sam Francis Found. v. eBay Inc., No. 11-06822-MWF-PLA (C.D. Cal. Oct. 18, 2011), ECF No. 1.  The Sam Francis Foundation was not a named plaintiff in the suit against Sotheby’s.
13. See, e.g., First Joint Motion to Dismiss, Christie’s, No. 11-08605-MWF-FFM, ECF No. 15.  The defendants’ motions also argued that the complaints failed to state a claim under Federal Rule of Civil Procedure 12(b)(6).
14. E.g., Order Granting First Joint Motion to Dismiss at 16, Christie’s, No. 11-08605-MWF-FFM, ECF No. 38.
15. Sam Francis Found. v. Christies, Inc., 784 F.3d 1320, 1322 (9th Cir. 2015).
16. See id. at 1326.
17. E.g., Second Joint Motion to Dismiss, Christie’s, No. 11-08605-MWF-FFM, ECF No. 103.
18. E.g., Civil Minutes: Order re Motions to Dismiss at 10, Christie’s, No. 11-08605-MWF-FFM, ECF No. 113.
19. Id.
20. Id. at 17 (quoting Laws v. Sony Music Entm’t, Inc., 448 F.3d 1134, 1137 (9th Cir. 2006)).  The Central District also held that (i) the CRRA did not constitute a Fifth Amendment “taking”; (ii) eBay was not a proper defendant (i.e., a seller of fine art or seller’s agent) under the CRRA; (iii) punitive damages were not available under the CRRA; (iv) the Estate of Robert Graham had no capacity to sue, and was thus not a proper plaintiff; (v) the complaints adequately plead sufficiently plausible facts under Rule 8; and (vi) Sotheby’s Motion to Dismiss for lack of subject-matter jurisdiction was more appropriately adjudicated on a motion for summary judgment.
21. See, e.g., Appellants’ Opening Brief at 27, eBay, No. 16-56252 (9th Cir. Mar. 8, 2017), ECF No. 8 (citing Morseburg v. Baylon, 621 F.2d 972 (9th Cir. 1980)).  In Morseburg, an art dealer who became obligated to pay royalties under the CRRA brought suit to challenge the validity of the act, arguing, among other things, that the CRRA was preempted by the first sale doctrine codified in the Copyright Act of 1909.  621 F.2d at 974-75.  The Morseburg court, upholding the validity of the CRRA, determined that there was no preemption under the 1909 Act. Id. at 978.  However, the court explicitly stated that it was not addressing the issue of CRRA preemption by the 1976 Copyright Act. Id. at 975.
22. See Appellants’ Opening Brief at 41-47; see also 17 U.S.C. § 301(a) (establishing that “all legal or equitable rights that are equivalent to any of the exclusive rights . . . specified by section 106 . . . are governed exclusively by this title” (emphasis added)).
23. See Joint Brief of Appellees Christie’s & Sotheby’s at 14, No. 16-56235 (9th Cir. June 20, 2017), ECF No. 26.
24. Kirtsaeng v. John Wiley & Sons, Inc., 568 U.S. 519 (2013); Quality King Distribs., Inc. v. L’anza Research Int’l, Inc., 523 U.S. 135 (1998); Omega S.A. v. Costco Wholesale Corp., 776 F.3d 692 (9th Cir. 2015).
25. See Joint Brief of Appellees Christie’s & Sotheby’s at 14-18.
26. Id. at 20.
27. See, e.g., Appellants’ Reply Brief at 2-7, Sotheby’s, No. 16-56234 (9th Cir. Aug. 21, 2017), ECF No. 44 (discussing Impression Prods., Inc. v. Lexmark Int’l, Inc., 137 S. Ct. 1523 (2017)).
28. Cf. Lexmark, 137 S. Ct. at 1527 (analogizing the exhaustion doctrine and the first sale doctrine).
29. See Appellants’ Reply Brief at 5.
30. See id. at 6-7.
31. Joint Brief of Appellees Christie’s & Sotheby’s at 18 (quoting Lexmark, 137 S. Ct. at 1532); see also id. (quoting Lexmark, 137 S. Ct. at 1534 (characterizing the exhaustion doctrine as “reflect[ing] the principle that, when an item passes into commerce, it should not be shaded by a legal cloud . . . as it moves through the marketplace”)).

Two recent developments promise to shed more light on the legal status of unauthorized street art, which we explored earlier this year in our post Unchartered Territory: Enforcing an Artist’s Rights in Street Art.

Cohen v. G&M Realty L.P., No. 13CV05612, 2017 WL 1208416 (E.D.N.Y. Mar. 31, 2017).

As discussed in our earlier post, in November 2013, Judge Block of the Eastern District of New York declined to issue a preliminary injunction under VARA that would have stopped property owners’ demolition of 5Pointz “graffiti Mecca” in Long Island City, New York to make way for a residential development.1  In Cohen v. G&M Realty L.P, the plaintiffs argued that they were empowered to prevent the destruction of their mural under the VARA provision that allows an artist to prevent the destruction of his or her work if work is of “recognized stature.”2  The court found that some of the works in the 5Pointz composite piece might qualify as works of “recognized stature,” but otherwise did not carry through with a VARA analysis. Instead, the court declined to issue a preliminary injunction based on its finding that the plaintiffs-artists failed to demonstrate irreparable harm because money damages would be sufficient to compensate them.

The case then moved forward on the artists’ claim for damages.  The defendants moved for summary judgment, contending that the plaintiffs had not made a prima facie case for the “recognized stature” of the 5Pointz murals.  On March 31, 2017, the court denied the defendants’ motion for summary judgment dismissing the VARA claim, allowing the matter to proceed to trial on that claim.  The defendants had argued in part that “the plaintiffs’ expert report focused on the ‘recognized stature’ of the artist, rather than the work itself, in contravention of VARA.”3  The district court rejected this argument, noting that courts have employed various methods to determine “recognized stature” under VARA, including inferring a particular work’s stature based on its creator’s reputation.  The court concluded that, “[w]ith VARA silent as to how a work’s stature may be pegged, acceptance of such methodology in this case has the added benefit of honoring VARA’s broad purpose.”4

Judge Block also rejected the defendants’ contention that the methodology underlying the report on “recognized stature” submitted by the plaintiffs’ expert did not satisfy the minimum standard under the Supreme Court’s Daubert test.  The court found that the plaintiffs’ expert relied on a variety of factors in reaching her conclusion regarding the stature of the plaintiffs’ work, including:

Cohen’s multiple commissions from such entities as Coors, Heineken, Swatch, and Deutsche Bank; another’s commissions from some of Brazil’s famous brands; a third one’s hiring by celebrity clients and a public park; the opinions of leading museum professionals and other artists; the individual artist’s social media followers and their works’ Google hits; flattering newspaper accounts in The Boston Globe, The New York Times, and New York Magazine; academic approval; private and public exhibitions of the artists’ other work throughout the United States and other nations; numerous awards, including induction in the Graffiti Hall of Fame; and more.5

Judge Block found that, by citing such evidence, all of which was relevant to the question of stature, the plaintiffs’ expert adequately explained the documents she reviewed, relevant industry customs and practices, and the general bases for her opinion.  The expert thus satisfied the Daubert minimum, and her opinion would be admissible in evidence for evaluation by the jury, even though the court expressed “some skepticism” regarding its “cogency.”

It would thus appear that—absent an eleventh-hour settlement—we will now have our first VARA trial testing whether unauthorized street art is legally protected from destruction by the owner of the site where the unauthorized art was situated.

Thrasher v. Siegel, No. 2:17-cv-03047 (C.D. Cal. April 24, 2017).

On April 24, 2017, muralist Monte Thrasher brought suit in Los Angeles against various individual and corporate defendants alleging that they had painted over his well-known Six Heads mural in violation of VARA.  Thrasher began working on the Six Heads mural—located on an exterior wall of a building in the Los Feliz neighborhood of Los Angeles—in 1992, and thereafter periodically retouched the mural.  According to Thrasher’s complaint, the defendants painted over the mural in 2014, without first obtaining Thrasher’s permission, so that another mural (commissioned by the occupant of the building) could be painted on the same surface.  Thrasher argues that, by painting over his mural—which included his name and contact information—the defendants infringed his rights of integrity and attribution, in violation of 17 U.S.C. § 106A.  The recently filed complaint does not, however, allege that the mural was of “recognized stature” and therefore protected from destruction.

Given the limited judicial guidance on VARA’s application to unauthorized art, whether and how the Central District of California addresses Thrasher’s claim will be of great interest.

__________________
1. Cohen v. G&M Realty L.P., 988 F. Supp. 2d 212 (E.D.N.Y. 2013).
2. Id. at 215.
3. Cohen v. G&M Realty L.P., No. 13CV05612FBRLM, 2017 WL 1208416, at *3 (E.D.N.Y. Mar. 31, 2017).
4. Id.
5. Id.

As street art – typically painting or drawing on someone else’s wall – grows in status in art circles,1 street artists are finding that their work is increasingly being exploited without their permission. While a number of these artists have attempted to assert copyright2 or Visual Artists Rights Act (“VARA”) rights to protect their work, courts have not yet had occasion to establish a legal framework in which street artists can reliably protect their work because these claims largely have ended in private settlements.

With the increasing appropriation of street art several questions have arisen but are still  unresolved by courts:  Do street artists have copyright in their work?  Should they be able to prevent the unauthorized copying, sale, removal or destruction of their (by and large unauthorized) work?  To the extent copyright offers inadequate protection, may street artists assert VARA rights in their work?

I. Unauthorized Street Art and Copyright

For street artists who create their work on someone else’s property without the property owner’s permission, there is an awkward dilemma:  Should street art which is the result of illegal trespassing and (arguably) criminal mischief3 be entitled to legal protection under federal copyright law?

A. Villa v. Pearson Education, Inc. Casts Doubt on the Copyrightability of Unauthorized Street Art.

The Copyright Act does not explicitly state that illegality in the course of a work’s creation prevents copyrightability or is a defense to an infringement claim. Courts have addressed the copyrightability of unauthorized art on few occasions, without offering clear guidance.

Villa v. Pearson Education, Inc., decided over a decade ago, casts doubt on the copyrightability of unauthorized street art.There, street artist Hiram Villa, known by his pseudonym “UNONE,” brought a copyright infringement suit against Brady Publishing alleging, among other things, that the publishing company reproduced his unauthorized mural in a book without his permission.5  Villa had not registered copyright in his works, however, and the court dismissed the action for that technical reason and declined to exercise supplemental jurisdiction over the artist’s state law claims.6  Villa thereafter obtained a Certification of Registration from the United States Copyright Office and filed a new complaint alleging copyright infringement.  Brady again moved to dismiss the complaint, arguing in part that “the mural in question is not protected by copyright . . . because it is illegal graffiti.”7  The court denied Brady’s motion to dismiss, reasoning in part that Brady’s argument “turn[s] on questions of fact” as it “would require a determination of the legality of the circumstances under which the mural was created.”8  By acknowledging a need to assess the underlying “legality”  of a work’s creation to assess its copyrightability, the court implicitly accepted the defendant’s argument that a work’s unauthorized creation on someone else’s property could be a defense to copyright infringement.  Ultimately, the parties reached a settlement, providing no further guidance on the copyrightability of unauthorized art.

A respectable argument exists that the circumstances in which a work of art was made, or the ownership of the physical object on which the artwork is created, should not affect the artist’s copyright rights in the artwork.  It is a well-established principle of copyright law that copyright is distinct from ownership rights in the physical object embodying the work.  Even if the artist trespassed to make her mural, why should that permit a third party to profit off that mural by using it to sell books or handbags?

Since Villa, several other street artists have brought suit under the Copyright Act attempting to protect their work.  In July 2014, Miami street artist David Anasagasti, better known by his pseudonym “Ahol Sniffs Glue,” sued American Eagle Outfitters, alleging the retail brand reproduced his work in apparel advertising campaigns.9  In August of that year, artist Maya Hayuk sued Coach, the handbag retailer, claiming that the luxury brand prominently featured her “Chem Trails NYC” mural in promoting its apparel and accessories lines.10  Around that time, a trio of California-based graffiti artists sued fashion designer Roberto Cavalli S.p.A. and various retailers for reproducing their mural in marketing clothing and accessories.11  To the dismay of artists desiring legal guidance, however, all these cases settled out of court.

B. Banksy and the Splitting of Rights between Artist and Property Owner

Assuming that unauthorized street art is protectable under the Copyright Act, copyright would still not grant the artist ownership of the tangible medium of expression in which the work is fixed; that belongs to the property owner of the wall (or other object) on which the art has been created.  This tension between property law and copyright law splits between property owner and artist the rights that would otherwise belong exclusively to the copyright holder under Section 106 of the Copyright Act:  The property owner, who owns the physical embodiment of the work, would have the right to display and sell the original work, whereas the copyright holder would have the exclusive right to reproduce the work and prepare derivative works without interfering with the property owner’s rights.

This tension between property law and the Copyright Act led to the situation in 2010 where a property owner, not the artist, sought to protect an artist’s graffiti work.  In that case, Bioresource Inc., claiming ownership of the site of the crumbling Packard Plant in Detroit, sued 555 Gallery over the gallery’s removal of a 1,500-pound cinderblock wall featuring artwork by famously elusive British graffiti artist Banksy.12  Bioresource brought suit in Wayne County Circuit Court, arguing that the mural was worth at least $100,000.13  The parties settled the case out of court, with Bioresource agreeing to donate the mural to the gallery, which in turn agreed to pay Bioresource a symbolic amount.14

II. Unauthorized Art and VARA

In 1990, Congress enacted the Visual Artists Rights Act (“VARA”), codified at Section 106A of the Copyright Act, to protect artists’ moral rights – namely, the rights of integrity and attribution.  Thus, VARA entitles an author of a work of visual art to prevent intentional modification of that work “which would be prejudicial to his or her honor or reputation,” prevent the use of his or her name as the author in the event of prejudicial modification, and prevent destruction of a work of “recognized stature.”15  VARA provides another tool that street artists might employ to protect their creations.

A. English and Pollara: VARA Might Offer Protection for Unauthorized Art

In English v. BFC & R East 11th Street LLC, a group of artists brought suit under VARA seeking a preliminary injunction to prevent the defendants’ unauthorized destruction of their unauthorized murals in a community garden.16  The district court held that VARA does not apply to unauthorized works of art if the works are permanently affixed to the structure, invoking public policy considerations:  “[O]therwise parties could effectively freeze development of vacant lots by placing artwork there without permission.  Such a construction of the statute would be constitutionally troubling, would defy rationality and cannot be what Congress intended in passing VARA.”17  English’s distinction between removable and unremovable works of art suggests that VARA may offer protection for unauthorized art if it is removable.

In Pollara v. Seymour, the Northern District of New York highlighted the same distinction between removable and unremovable works of art.  There, the artist installed a mural in the property owners’ plaza under the incorrect assumption that the company that commissioned her work had obtained a permit.18  The property owner subsequently removed the unauthorized mural from its frame and significantly damaged the work in the process.19  The artist brought suit under VARA, and the property owners moved for summary judgment, arguing in part that the work was not entitled to protection under VARA because the work was installed without permission.  The court rejected this argument, reasoning that there was “no basis in the statute to find a general right to destroy works of art that are on property without the permission of the owner.”20  The defendants further argued the mural was not entitled under VARA to protection against intentional or grossly negligent destruction because it was not a “work of recognized stature.”21  The court declined to resolve this issue on summary judgment, finding that there were questions of fact to be decided.22  Following trial, the court ultimately dismissed the plaintiff’s claim and held that the plaintiff failed to demonstrate that her mural was a “work of recognized stature,” reasoning that the mural evidently was “not intended to have any lasting value.”23  Whether street art may qualify as a “work of recognized stature” was addressed by the Eastern District of New York in assessing destruction to 5Pointz, discussed below.

B. 5Pointz:  Preventing the Destruction of Street Art of “Recognized Stature”

In November 2013, the Eastern District of New York declined to issue a permanent injunction under VARA that would have stopped property owners’ demolition of the 5Pointz “graffiti Mecca” in Long Island City, New York to make way for a residential development.24  In Cohen v. G&M Realty L.P, the plaintiffs argued that they were empowered under VARA to prevent the destruction of their mural under the VARA provision that allows the author of a work to prevent that work’s destruction if it is of “recognized stature.”25  The court found that some of the works in the composite piece might qualify as works of “recognized stature,” but otherwise did not carry through with a VARA analysis.  Instead the court noted that the plaintiffs had failed to demonstrate irreparable harm:

[P]laintiffs would be hard-pressed to contend that no amount of money would compensate them for their paintings and VARA—which makes no distinction between temporary and permanent works of visual art—provides that significant monetary damages may be awarded for their wrongful destruction.  In any event, paintings generally are meant to be sold.26

The court further found the “transient nature” of the plaintiffs’ work to be dispositive as to the issuance of an injunction.  According to the court, the plaintiffs had always known that the walls on which they painted their murals would be destroyed.27

Although sympathetic to the artists’ interests – “our souls owe a debt of gratitude to the plaintiffs for having brought the dusty walls of defendants’ buildings to life”28 – the court’s analysis seems to foreclose the availability of injunctions under VARA to graffiti artists, even if they are of recognized stature:   under the court’s reasoning, the availability of statutory damages, the existence of an art market, and graffiti’s very ephemeral nature all mitigate against a finding of irreparable harm.

III. Conclusion

To the dismay of many street artists, it remains unclear whether copyright law affords protection for unauthorized street art.  Villa arguably cast doubt on the copyrightability of unauthorized works over ten years ago, but no subsequent decision has gone so far as to explicitly deny copyright protection on that basis.

Under copyright law, the artist’s rights in street art conflict with those of the property owner insofar as the property owner owns the tangible original work.  The tension between artist’s rights and the property owner’s rights resurface under  VARA, but in a different guise.  In that context, the issue is whether an artist can assert moral rights in street art and thereby freeze the development of a building.  That very policy concern led the court in English to deny VARA protection to an unremovable, unauthorized mural.

Given the unsettled state of the law, there remains the policy-oriented question of whether such works should be copyrightable.  Insofar as copyright law is intended to incentivize creation, assuming that street art is a practice that at least sometimes has value to the public, does the creation of street art benefit under a regime of copyright?  In other words, is copyright necessary to incentivize the creation of more street art?  The proliferation of street art in the absence of robust intellectual property protection probably suggests a negative answer to that particular question.

Conversely, if illegality in creation is a bar to copyrightability, the tension between property rights and copyright still does not disappear.  If we care seriously about property rights, should copyright law extend rights to a book publisher, for instance, seeking to profit from the underlying, unauthorized work?

Finally, there is a fundamental tension when street artists – whose very genre of art is premised on its “outlaw” nature – ask the courts legal protection under the Copyright Act or VARA.

 

1. See e.g., Allison Young, “Making Money by Mocking Power: Inside the New Banksy Exhibition,” CNN WORLD (Oct. 24, 2016), http://www.cnn.com/2016/10/24/arts/the-art-of-banksy-melbourne/ (Stating that street artist Banksy, who has stenciled graffiti in New York, London and Melbourne and other places, “is one of the most influential artists in the world.”); see also, “Street Art Expo NYC 2016 Celebrates Three Generations of Graffiti Art with: Part One, Flint Gennari, Alski, Nic 707, Moody Mutz, Plasma Slug, Chief 69 and more,” Street Art NYC (May 24, 2016), http://streetartnyc.org/blog/2016/05/24/street-art-expo-nyc-2016-celebrates-three-generations-of-graffiti-art-with-part-one-flint-gennari-alski-nic-707-moody-mutz-plasma-slug-chief-69-and-more/; see also Jonathan LeVine Gallery, http://jonathanlevinegallery.com/tag/street-art/; Lowbrow Artique, http://www.lowbrowartique.com/gallery/; Woodward Gallery, http://woodwardgallery.net/; Museum of the City of New York, https://collections.mcny.org/Gallery/24UPN47RMLQ.
2.  Under United States copyright law, a work receives protection if it is an “original work of authorship fixed in any tangible medium of expression.”  17 U.S.C. § 102. A work is “original” if it was “independently created” and possesses “at least some minimal degree of creativity”; it need not be novel.  Feist Publications, Inc. v. Rural Tel. Serv. Co., 499 U.S. 340, 345 (1991). A work is “‘fixed’ in a tangible medium of expression when its embodiment in a copy . . . is sufficiently permanent or stable to permit it to be perceived, reproduced, or otherwise communicated for a period of more than transitory duration.”  17 U.S.C. § 101. Copyright entitles the owner to a set of exclusive rights, including the right to reproduce the work, prepare derivative works, distribute copies, and, for certain types of works, display the work. 17 U.S.C. § 106.
3.  N.Y. Penal Law § 145.60 makes it a Class A misdemeanor to make an “etching, painting, covering, drawing upon or otherwise placing of a mark upon public or private property with intent to damage such property . . . on any building, public or private, or any other property real or personal owned by any person, firm or corporation or any public agency or instrumentality, without the express permission of the owner or operator of said property.”
4.  Villa v. Pearson Educ., Inc., No. 03 C 3717, 2003 WL 22922178 (N.D. Ill. Dec. 9, 2003).
5.  Id. at *1.
6.  Id. at *1.
7.  Id. at *2.
8.  Id. at *3.
9.  Anasagasti v. American Eagle Outfitters, Inc., Case No. 1:14-cv-05618 (S.D.N.Y. July 23, 2014).
10.  Hayuk v. Coach Services, Inc. et al, Case No. 1:14-cv-06668 (S.D.N.Y. Aug. 19, 2014).
11.  Jason Williams et al v. Roberto Cavalli, S.p.A. et al, Case No. 2:14-cv-06659 (C.D. Cal. Aug. 25, 2014).
12.  The Associated Press, Banksy Battle: Packard Plant Ownership Sues Detroit Art Gallery for Removal of Graffiti Mural, MICH. LIVE (July 7, 2010), http://www.mlive.com/news/detroit/index.ssf/2010/07/banksy_backlash_packard_plant.html.
13.  Id.
14.  Anne Laure Bandle, Andrea Wallace & Marc-André Renold, Banksy Mural – Bioresource, Inc. and 555 Nonprofit Studio/Gallery, Platform ArThemis, https://plone.unige.ch/art-adr/cases-affaires/banksy-mural-2013-bioresource-inc-and-555-nonprofit-studio-gallery.
15.  17 U.S.C. § 106A.
16.  English v. BFC&R E. 11th St. LLC, No. 97 CIV. 7446 (HB), 1997 WL 746444, at *1 (S.D.N.Y. Dec. 3, 1997), aff’d sub nom. English v. BFC Partners, 198 F.3d 233 (2d Cir. 1999).
17.  Id. at *4.
18.  Pollara v. Seymour, 150 F. Supp. 2d 393, 394 (N.D.N.Y. 2001).
19.  Id.
20.  Id. at 396 n.4.
21.  Id. at 396.
22. Id. at 399.
23.  Pollara v. Seymour, 206 F. Supp. 2d 333, 337 (N.D.N.Y. 2002), aff’d, 344 F.3d 265 (2d Cir. 2003).
24.  Cohen v. G&M Realty L.P., 13-CV-5612 (FB) (E.D.N.Y. Nov. 20, 2013).
25.  Id. at 3.
26.  Id. at 24-25 (citation omitted).
27.  Id. at 26.
28.  Id. at 23.

 

Nathan Cole and Joanna Liu assisted with the drafting of this post.

An erroneous copying of a judicial opinion led the Seventh Circuit to reverse a decision about an erroneous copying of a portrait.

Jesus Muhammad‐Ali, the grandson of deceased Nation of Islam leader Elijah Muhammad, painted a portrait of the current leader, Louis Farrakhan, at his request.  Ali registered a copyright of that commissioned portrait in 1986.

The Final Call, a publication affiliated with the Nation of Islam, sold more than one hundred lithographs of Ali’s portrait of Farrakhan over several years.  Ali eventually sued The Final Call for copyright infringement.  Before trial and in response to a motion to strike its affirmative defenses, The Final Call relinquished its affirmative defenses and advised the court it would argue that Ali could not “establish [his] own burden” of proving the copies were unauthorized.

At trial, The Final Call’s sole witness confirmed there was no corporate relationship between Farrakhan and The Final Call, that Farrakhan had not been acting on behalf of The Final Call in commissioning the portrait, and that The Final Call had no evidence that Ali authorized the creation or sale of the lithographs.

The United States District Court for the Northern District of Illinois concluded that, no matter which party had the burden of proving the prints were authorized, the facts demonstrated that Ali authorized the making of the lithographs.

The Seventh Circuit reversed.  That Court noted that, to establish copyright infringement, Ali was required to prove only two elements: “(1) ownership of a valid copyright, and (2) copying of constituent elements of the work that are original.”  It cited Peters v. West, 692 F.3d 629, 632 (7th Cir. 2012) for this blackletter statement of law.  The parties did not dispute that Ali proved both elements, but Ali did not prove that the copying was unauthorized.

The district court had relied on the Seventh Circuit’s 2013 decision in Hobbs v. John, 722 F.3d 1089 (7th Cir. 2013), which misquoted the Seventh Circuit’s 2012 holding in Peters by adding an additional requirement to prove “unauthorized copying.”  Hobbs states:  “To establish his copyright infringement claim, Hobbs must prove ‘(1) ownership of a valid copyright; and (2) unauthorized copying of constituent elements of the work that are original.’  Peters, 692 F.3d at 632.”  Hobbs, 722 F.3d at 1094 (emphasis added).  The standard established in Peters did not contain the word “unauthorized.”  In reversing the district court’s decision, the Seventh Circuit acknowledged:  “We take some responsibility for the mix‐up here, in light of the mistranscription of the standard for a prima facie case of copyright infringement that appears in our opinion in Hobbs.”

The Seventh Circuit concluded that the district court also erred by crediting defenses that The Final Call had waived.  Since there was no evidence of a written or oral license, the district court considered the defense of an “implied license” to reproduce the lithographs.  The Seventh Circuit rejected that defense, primarily because there was no evidence that Ali intended The Final Call to copy and distribute his work.  The district court also considered the “first-sale” defense, according to which once a copy has been sold, the acquirer may sell it again without the permission of the copyright owner.  The Seventh Circuit rejected that defense because The Final Call did not assert it, much less provide any evidence support it.

This case is of interest to practitioners defending against copyright infringement claims.  In particular, if a party wishes to assert a valid defense against such a claim by alleging that it had a license – even an implied license – it must be prepared to meet the evidentiary burdens in asserting that defense.1  In order to make out a prima facie case of copyright infringement, a plaintiff need only prove that it owns a valid copyright in a work and that defendant copied constituent elements of the work.  The burden to prove that the copying was authorized – and therefore asserting an affirmative defense that a license exists – always lies with the defendant,2 despite the cases that characterize infringement as “illicit copying” or “improper appropriation.”

1. Although The Final Call ultimately asserted no affirmative defenses (as it waived its implied license defense at the pretrial conference), the court assessed the merits of the alluded-to defense, anyway.  In doing so, the court noted that The Final Call met none of the elements of alleging an implied license was present, even though the district court found that Ali had authorized the making of lithographs “no matter which side bore the burden of proof.”  Though the Seventh Circuit questioned the District Court’s rationale in reaching that finding, it reiterated that The Final Call did not present any evidence to satisfy the other two elements of an implied license defense.
2. In clarifying the district court’s reliance on an “unclear or erroneous” pattern jury instruction used in the Seventh Circuit, the Court of Appeals noted that there are two methods that a plaintiff can prove copying:  (1) “that defendant had the opportunity to copy the original” (i.e., “access”); and (2) “that the two works are ‘substantially similar,’ thus permitting an inference that defendant actually did copy the original.”  Peters, 692 F.3d at 633.   In this case, the district court relied on a Seventh Circuit pattern jury instruction which noted that the jury “may consider evidence that defendant’s work was created independently of Plaintiff’s copyrighted work [or that Defendant had authority from Plaintiff to copy Plaintiff’s work].”   The court criticized this pattern instruction as “either erroneous or at the very least misleading,” since it improperly places the burden of proving the existence of a license on the plaintiff.

Carol Highsmith, a renowned American photographer, has filed a lawsuit against Getty Images (“Getty”) and others for violation of the Digital Millennium Copyright Act (“DMCA”).1  Specifically, Highsmith alleges that the three defendants – Getty and Alamy (companies that sell stock photos) and License Compliance Services (“LCS”) (a company that searches the internet for copyright-infringing photographs and seeks to enforce copyright licenses) – violated 17 U.S.C. § 1202 by providing, distributing and altering the copyright management information (“CMI”) of thousands of Highsmith’s photographs.  Statutory damages could bring the final judgment against Getty alone to over a billion dollars.  The case raises interesting issues surrounding the interpretation of § 1202 and the statutory damages framework.

Alleged Improper and Illegal Use of Photographs

According to the complaint, Highsmith donated her photographs to the Library of Congress in 1988, making those photographs free for public use and duplication but remaining the copyright holder.2  Her photographs are all available on the Library of Congress website.  In December 2015, Highsmith’s foundation received a letter from LCS on behalf of Alamy, accusing the foundation of copyright infringement and demanding payment of royalties for the use of one of Highsmith’s own photographs that her foundation was displaying on its website.3  Upon receiving this notice, Highsmith contacted LCS and afterwards received an e-mail stating that LCS had closed her case – “thereby implicitly acknowledging the correctness and propriety of her position.”4  She later discovered that Getty offered over 18,000 of her photographs available for sale on its website and that Alamy had over 500 for sale on its website.5  The Highsmith Complaint alleges that the defendants’ uses of her photos were improper and illegal.6

Both websites provided CMI for the photographs—i.e., information regarding the photographs’ authorship and copyright status—and Getty also provided a watermark claiming it had an ownership in the photographs.7  The Highsmith Complaint states that Getty did not identify Highsmith as the sole author and copyright owner of the images.8  Allegedly, Getty’s CMI for these photographs stated “By: Buyenlarge,” or “Credit: Buyenlarge/Contributor” together with the image title, or partial title, and “(Photo by Carol M. Highsmith/Buyenlarge/Getty Images).”9  The complaint alleges that Getty and Alamy violated 17 U.S.C. § 1202(a), which prohibits providing or distributing false CMI, and § 1202(b), which prohibits removing or altering CMI, by listing incorrect CMI alongside Highsmith’s photographs on their websites.10  Section 1202(c) defines CMI as information, such as the name of an author, the name of the copyright holder, and terms and conditions for the use of the work that is “conveyed in connection with copies or phonorecords of a work.”  The Highsmith Complaint alleges, inter alia, that Getty and Alamy violated § 1202 by not listing Highsmith as the sole author and copyright owner of her photographs on their websites.11

On July 28, 2016, Getty stated that it was reviewing the Highsmith Complaint; that it is not illegal to charge money for works in the public domain; that it provides valuable services—indexing and making content searchable, providing a variety of delivery services for images, and furnishing legal indemnification for copyright violations for those who purchase images from it—and that it intends to contest the case “vigorously.”

Interpreting CMI

The district courts are divided in their interpretation of CMI in § 1202.  In IQ Grp., Ltd. v. Wiesner Pub., LLC, Judge Greenaway of the District of New Jersey limited CMI to information digitally embedded in a copyrighted work.12  “Digital watermarking technologies allow users to embed into audio, images, video and printed documents a digital code that is imperceptible during normal use but readable by computers and software.”13  In contrast, in Agence France Presse v. Morel, Judge Pauly of the Southern District of New York “decline[d] to adopt a narrow construction of the term ‘CMI’” and instead interpreted CMI to encompass the name of the author of eight photographs, where that information was posted next to the photographs on a webpage.14

Highsmith’s complaint alleges that Getty and Alamy posted the false copyright information next to Highsmith’s photographs on their websites.  These allegations fall squarely within the Morel definition of CMI, but safely outside of the IQ Group definition.  Highsmith filed suit in the Southern District of New York, but there is no binding Second Circuit precedent defining CMI, and how the court will interpret CMI is an open question.

Potential Damages

Under the DMCA, Getty is potentially liable for over a billion dollars in statutory damages.  In 2012, the Getty business was valued at $3.3 billion.15  While it seems unlikely that a judge would impose a company-destroying penalty, the case presents an example of how stacking violations in calculating statutory damages linearly can prove problematic.

17 U.S.C. § 1203(c)(3) sets statutory damages for each violation of § 1202 between $2,500 and $25,000, and if a defendant has been found to have violated § 1202 within the past three years, “the court may increase the award of damages up to triple the amount that would otherwise be awarded.”16  Getty was found liable of violating § 1202 in Agence France Presse v. Morel, and Morel, the photographer, elected to receive $1,200,000 in statutory damages.17  Here, Getty’s potential liability is $25,000 each for over 18,000 photographs, tripled:  in total, well over a billion dollars.

Would such statutory damages violate due process?  According to Judge Howard in the First Circuit, a statutory damage award violates due process only “where the penalty prescribed is so severe and oppressive as to be wholly disproportioned to the offense and obviously unreasonable,” as  articulated in St. Louis, Iron Mountain & Southern Ry. Co. v. Willams.18  There, the defendant’s argument that statutory damages violated due process because they were not tied to the injury “disregard[s] the deterrent effect of statutory damages, the inherent difficulty in proving damages in a copyright suit, and [the plaintiff]’s evidence of the harm it suffered from conduct such as [defendant]’s.”19  The Eighth Circuit, in Capitol Records, Inc. v. Thomas-Rasset, also followed Williams in upholding a statutory damage award, stating that, as in Williams, “‘the interests of the public, the numberless opportunities for committing the offense, and the need for securing uniform adherence to [federal law]’ support the constitutionality of the award.”20  The Eighth Circuit stated that both the absolute amount of the award and the amount per violation are relevant in determining whether the award’s severity and oppressiveness are disproportioned to the offense and obviously unreasonable.21  In Capitol Records, the plaintiffs opted to sue over twenty-four recordings, and the court noted that, “[i]f they had sued over 1,000 recordings, then a finder of fact may well have considered the number of recordings and the proportionality of the total award” in determining whether the award was disproportional and unreasonable.”22

Professor Bert Huang of Columbia Law School has argued that cases such as this are examples of “diminishing marginal harm,” where each violation of a law that provides statutory damages is less injurious to the individual seeking redress than the last.23  Here, while Highsmith was injured by the first ten or hundred or thousand images that Getty allegedly misappropriated, under standard economic principles her injury from mislabeling the eighteen-thousandth photograph is presumably substantially lower than her injury from the first photograph.  Professor Huang suggests that certain damages instead should be calculated “concurrently,” as sentences are often set in criminal cases.  If Highsmith prevails, it will be interesting to see how the Southern District of New York and the Second Circuit handle statutory damages for over 18,000 of her images.  The courts should consider the logic of Professor Huang’s argument for concurrent damages; however, Getty may settle this case before Highsmith’s statutory damages are adjudicated.

UPDATE: On October 17, 2016, oral argument in this case “focused almost completely on claims brought under Section 349 of New York’s General Business Law,” which forbids deceptive business practices generally.  On October 28, 2016, Judge Jed Rakoff of the Southern District of New York dismissed Highsmith’s claims under the Copyright Act and trademark law, but allowed claims under Section 349 to go forward with discovery.  Perhaps Judge Rakoff was persuaded by Getty’s argument that it did not infringe Highsmith’s copyrights because she “owns no such copyrights, having long ago dedicated [her photographs] to the public domain”; however, he did not issue a written opinion at that time, instead promising a fleshed-out memorandum “in due course.” On November 16, 2016, before issuing a written decision on the copyright and trademark claims, Judge Rakoff so-ordered the parties’ stipulation to dismiss the action with prejudice. Although the terms of the parties’ settlement were not disclosed, the sum was likely much less than the billion dollars originally claimed.
__________________
1. First Amended Complaint, Carol M. Highsmith v. Getty Images (US), Inc., No. 16-cv-5924 (S.D.N.Y. 2016), (hereinafter Highsmith Complaint).
2. Id. at 7.
3. Id. at 18-21.
4. Id. at 20-21.
5. Id. at 12-16.
6. Id.
7. Id. at 12-16, 27.
8. Id.
9. Id. at 12.
10. Id. at 24-32.
11. Id.
12. 409 F. Supp. 2d 587, 597 (D.N.J. 2006).
13. Id.
14. 769 F. Supp. 2d 295, 305 (S.D.N.Y. 2011).
15. In August 2012, the Carlyle Group bought a majority share in Getty Images from Hellman & Friedman; the Getty family and co-founder Jonathan Klein own the rest. That deal valued Getty Images at $3.3 billion.
16. 17 U.S.C. § 1202(c)(4).
17. 2014 WL 3963124 (S.D.N.Y. Aug. 13, 2014).
18. Sony BMG Music Entm’t v. Tenenbaum, 719 F.3d 67, 70 (1st Cir. 2013) (quoting 251 U.S. 63, 66-67 (1919)).
19. Id. at 71.
20. 692 F.3d 899, 910 (8th Cir. 2012).
21. Id.
22. Id.
23. Bert I. Huang, Concurrent Damages, 100 Virginia L. Rev. 711 (2014).

In a recent decision, the Ninth Circuit Court of Appeals adopted a utility-based standard for determining when a work of art is deemed “applied art” and therefore not entitled to protection under the Visual Artists Rights Act (“VARA”).1  VARA was enacted in 1990 as an amendment to the Copyright Act, and incorporated the concept of droit moral to prohibit the “intentional distortion, mutilation or other modification” of a work of visual art, rather than a work of “applied art.”2  In Cheffins v. Stewart,3 the appeals court held that the appropriate standard for determining whether a work of art is ineligible for protection under VARA as “applied art” is whether the work “was – and continues to be – utilitarian in nature.”4

This ruling poses substantial obstacles for works that contain a utilitarian function to receive protection under VARA.  Despite the court’s attempt to clarify the difference between “applied art” and “visual art,” its analysis also may create more uncertainty for artists who seek to bring a VARA claim, since many art works contain utilitarian aspects, and it is unclear when a retained utilitarian function becomes significant enough to result in a work being deemed “applied art.”

The appeal arose from a dispute between the owners of La Contessa, a former school bus transformed into a replica of a 16th century Spanish galleon, and the defendant, who had purchased a plot of land on which the owners stored La Contessa.  For years, La Contessa transported attendees at the Burning Man Festival in Nevada, but the festival ultimately banned it as unsafe for transportation.  At that point, La Contessa moved to a plot of land that the defendant subsequently purchased; he then burned the wooden galleon enhancements in order to sell the underlying bus to a scrap metal dealer.  The owners of La Contessa sued the defendant on the basis that his destruction of La Contessa violated VARA because he intentionally damaged the work.  The defendant argued La Contessa was not protected by VARA because it fell under the category of “applied art,” not “visual art.”  The District Court agreed, ruling for the defendant on summary judgment.

The Ninth Circuit affirmed the District Court’s judgment, ruling that “La Contessa plainly was ‘applied art’” not protected by VARA given the school bus’s original utilitarian purpose and its fundamentally utilitarian nature after embellishment by the artists.5  Recognizing that VARA does not define “visual art” or “applied art,” the appellate court adopted a standard where “the focus of [the] inquiry should be on whether the object in question originally was – and continues to be – utilitarian in nature.”6  If the object retains a significant utilitarian purpose, then it constitutes “applied art” unprotected by VARA.  In adopting this test, the court hoped to avoid the need for courts to critique art or weigh the importance of artistic qualities when analyzing whether a work is protected by VARA.

Applying this test to the facts, the majority noted that La Contessa began as “a simple school bus – an object which unquestionably served the utilitarian function of transportation,” and while the creators adorned the bus with various “elaborative decorative elements” that had “many artistic qualities,” the primary function of La Contessa remained utilitarian.7  The work was used for transportation at the Burning Man festival and also served as a stage for performances and shows.8  As such, La Contessa “continued to serve a significant utilitarian function upon its completion” and therefore constituted “applied art.”9

Judge McKeown, writing in concurrence, disagreed with the majority’s “utilitarian” test and instead proposed a more nuanced, flexible approach in determining the nature of works so as not to “unduly narrow the protections of artists under [VARA].”10  Judge McKeown stated that the appropriate question to ask when determining whether a work of art constitutes applied art is whether “the primary purpose of the work as a whole is to serve a practical, useful function, and whether the aesthetic elements are subservient to that utilitarian purpose.”11  To highlight the flaws she perceived in the majority’s ruling, Judge McKeown described numerous historic works of art that would not be protected as visual art, including the Caryatids of the Acropolis and the monumental carvings of Ramses at the temple of Karnak, as these works retained a significant utilitarian function as they “are in fact columns that provided buildings with structural integrity.”12

Although the Court of Appeals hoped to avoid a need for “line drawing” when defining applied art,13 the test the majority adopted may not provide the clarity and objectivity for which it hoped.  Lower courts will still need to determine when a retained utilitarian purpose is “significant,” which may draw them into a quagmire of artistic analysis.  For example, when weighing the “significance” of the utilitarian purpose, should a court look to the artist’s intent for the work, or a subsequent owner’s actual use?  Will a work’s artistic merit inherently reduce its utilitarian significance?  Does the significance of the utilitarian function change over time, as advances in design and technology render the utilitarian function obsolete?  Further, by articulating such a stringent standard, the Ninth Circuit increased the likelihood that lower courts will classify any work that contains a subsidiary utilitarian element as “applied art.”  This will significantly narrow the reach of VARA and deter artists from bringing claims with respect to destruction of works that may incorporate utilitarian elements, thusly undermining one of VARA’s main goals.  Judge McKeown hoped to avoid such a scenario by arguing that the court’s focus should be on the “primary purpose” of a work, which acknowledges the possibility that both a utilitarian and visual purpose may co-exist in a work, and would ultimately provide greater protection to artists and their works.


1. This standard largely conforms to those promulgated by the Second Circuit in Carter v. Helmsley-Spear, Inc., 71 F.3d 77 (2d Cir. 1995) (holding that a sculpture constructed of portions of a school bus and affixed to a wall in a building lobby was not “applied art”) and Pollara v. Seymour, 344 F.3d 265 (2d Cir. 2003) (holding that “VARA may protect a sculpture that looks like a piece of furniture, but it does not protect a piece of utilitarian furniture, whether or not it could arguably be called a sculpture.”).
2. See 17 U.S.C. § 106A(a).
3. No. 12-16913 (9th Cir. June 8, 2016).
4. See id. at 10.
5. Id. at 13.
6. Id. at 10.
7. Id. at 13.
8. Id.
9. Id.
10. Id. at 18.
11. Id. at 19 (emphasis added).
12. Id. at 24.
13. Id. at 11.

 

 

 

Above: Donald Graham’s photograph, left, and Richard Prince’s “new portrait,” right.
__________________

Appropriation artist Richard Prince’s Motion to Dismiss is now fully briefed in Graham v. Prince et al., teeing up for Judge Stein of the Southern District of New York key questions regarding the scope of the fair use defense in the context of contemporary art.1

New Portraits, New Expression

As background:  In 2014, the Gagosian Gallery held Prince’s “New Portraits” exhibition, comprising a series of works that Prince created by copying and magnifying posts from the social media website Instagram (complete with elements of the Instagram graphic user interface such as “likes” and user “comments”), each featuring a “comment” of Prince’s own toward the bottom of the frame.  Included in the exhibit was the work at issue, Untitled (Portrait) (“Untitled”), for which Prince used as “raw material” an Instagram post depicting a mildly cropped version of plaintiff Donald Graham’s fine-art photograph Rastafarian Smoking a Joint (“Rastafarian”).2   In December 2015, Graham sued Prince, the Gagosian Gallery, and Larry Gagosian for copyright infringement.

Prince is no stranger to the courtroom.  An earlier series of his work was the subject of the Second Circuit’s 2013 Cariou v. Prince decision, which ruled as a matter of law that Prince had made fair use of certain of plaintiff Patrick Cariou’s photographs, and which was widely hailed as a victory for appropriation art generally.3   Cariou hinged on the court’s finding that 25 out of Prince’s 30 “crude and jarring” collage-like works – which used Cariou’s “serene” photographs as raw material but also variously incorporated paint, digital effects and images from other sources – infused the original works with “a new expression” and “a fundamentally different aesthetic” and therefore were “transformative.”4   The decision provided future courts with little concrete guidance, however, as to the proper test for assessing whether a given secondary use is transformative.  Graham squarely presents Judge Stein with the daunting task of deciding how Cariou is to be applied to an artistic project, such as New Portraits, in which the purported “transformation” is primarily conceptual rather than visual.

Contrasting Views of Cariou’s Reach

In his motion-to-dismiss papers in Graham, Prince takes the aggressive position that Cariou “control[s] and disposes of this case,” going so far as to pronounce that Graham “reflects an attempt to essentially re-litigate Cariou.”5   Prince’s argument then focuses on the two fair use factors to which courts tend to give most weight:  the purpose and character of the secondary use and the effect of the secondary use on the potential market for the copyrighted work.  Regarding the purpose and character of his use, Prince argues that Untitled is transformative of Rastafarian, in that whereas Graham’s photograph focuses on the “spirit and gravitas” of its human subject, Prince’s work is focused “no longer on the photograph itself, but on the fact that it has been used in a social media post.”6   Regarding market effect, Prince argues that Untitled does not and could not usurp the market for Rastafarian, not only because Graham has stated that he does not intend to license his fine art photography, but also because the audiences for the works are not the same:  No consumer seeking a fine art print conveying “the spirit and gravitas of the Rastafarian people” such as Rastafarian would accept as a substitute a “commentary on social media” such as Untitled.7

In his opposition papers, Graham draws sharp contrasts with Cariou on the same two factors.  Graham argues that no reasonable observer could find Prince’s Untitled transformative of Rastafarian, and that the comparison to Cariou does not hold:  In creating the works at issue in Cariou, Prince made significant visual modifications to the underlying works and incorporated imagery other than the underlying works; here, Graham argues, Prince’s work “merely depicts an exact copy of [Rastafarian],” which Prince has not modified other than to add a single line of text at the bottom of the frame.8   Graham observes that Untitled thus embodies less “transformation” than the five works at issue in Cariou which the Second Circuit expressly declined to deem transformative as a matter of law.9   Regarding the market effect factor, Graham argues that (i) while he has not yet licensed Rastafarian, the law protects the right of “the copyright owner who has not availed himself of a market . . . to change his mind,” and (ii) unlike Patrick Cariou, he does share the same audience as Prince – namely, museums, galleries and collectors of fine art.10   Graham supports this latter claim by asserting that the Gagosian Gallery exhibits and sells fine-art portraiture similar to Rastafarian alongside appropriation art such as Prince’s, and that the original Rastafarian work was in fact purchased by a prominent fine-art collector, Henry Buhl.11

Another Peril of Too Much “Social Media”?

One line of inquiry not raised in the briefing is whether Prince’s primary argument – that Untitled is transformative because its subject is properly understood as social media, not a smoking Rastafarian – might open him to a charge that his use of this particular copyrighted image therefore lacks “justification” under the Supreme Court’s 1994 decision Campbell v. Acuff-Rose Music, Inc.12  In that decision, while contrasting parody and satire, Justice Souter noted that while the former “needs to mimic an original to make its point, and so has some claim to use the creation of its victim’s (or collective victims’) imagination,” the latter “can stand on its own two feet and so requires justification for the very act of borrowing.”13   He further suggested that where a secondary work does not engage with “the substance or style of the original composition, which the alleged infringer merely uses to get attention . . . , [then] the claim to fairness in borrowing from another’s work diminishes accordingly (if it does not vanish), and other factors, like the extent of its commerciality, loom larger.”14   While the Second Circuit in Cariou expressly rejected the trial court’s reading of Campbell as requiring that a secondary use “comment” on or “critically refer back to” the underlying work in order to be deemed fair, in that case Prince’s visual alterations to and manipulation of Cariou’s original photographs demonstrated that – “commentary” or not – the secondary works at issue were in an aesthetic dialogue with the specific underlying works used, which could justify Prince’s use of them.15   Here, in contrast, where Prince’s legal position underscores the relative lack of such dialogue (at least on the visual level), Prince may expose himself to a Campbell-based argument that factors other than transformativeness – such as commercialism – should be given greater weight than they otherwise would be.16   Such an argument would be of little consequence, however, to the extent that Judge Stein were to read Cariou broadly, not only to reject a “commentary” requirement but also to foreclose any Campbell-based argument that an otherwise transformative use need be “justified” at all.

In sum, Prince’s motion presents the opportunity for Judge Stein to determine, among other things, (i) whether a secondary artwork that recontextualizes an underlying work without materially altering its visual content may be deemed transformative, and (ii) the appropriate level of granularity with which to define the “audience” that is relevant to the market-effect inquiry (e.g., “fine art collectors” or “fine art collectors seeking to purchase a piece of appropriation art”).  It will be particularly interesting to see how Judge Stein resolves the motion if he finds, as is certainly plausible, that the “purpose and character” factor weighs in favor of Graham, while the “market effect” factor weighs in favor of Prince – or vice versa.

__________________
1.  Case No. 15-cv-10160 (S.D.N.Y. filed Dec. 30, 2015).
2.  The Instagram post depicting Rastafarian had been posted without Graham’s permission by a third party not involved in the lawsuit.
3.  714 F.3d 694 (2d Cir. 2013).
4.  Id. at 707–08; see also id. at 706 (“Prince’s composition, presentation, scale, color palette, and media are fundamentally different and new compared to [Cariou’s] photographs . . . .”).
5.  Memorandum of Law in Support of Defendants’ Motion to Dismiss Plaintiffs’ Corrected Amended Complaint (ECF 34) at 1, 2.  This blog post focuses on the parties’ positions regarding whether Prince made fair use of Rastafarian; the parties’ briefs also address the appropriate measure of damages if Prince’s use is ultimately found not to have been fair.
6.  Id. at 3.
7.  Id. at 15, 21.
8.  Plaintiff’s Memorandum of Law in Opposition to Motion to Dismiss (ECF 39) at 8–9.
9.  Id. at 11.
10.  Id. at 17, 21.
11.  Id. at 17.
12.  510 U.S. 569 (1994).
13.  Id. at 580–81.
14.  Id.
15.  Cariou, 714 F.3d at 706 (discussing Cariou v. Prince, 784 F. Supp. 2d 337, 348 (S.D.N.Y. 2011)).
16.  See Campbell, 510 U.S. at 580.