On February 12, Judge Frederic Block of the Eastern District of New York awarded $6.75 million in statutory damages to the aerosol artists of “5Pointz,” agreeing with the jury’s advisory finding that property developer Jerry Wolkoff violated those artists’ “right of integrity” under the Visual Artists Rights Act (“VARA”).
As previously covered on this blog, VARA’s right of integrity grants a visual artist the right to prevent the destruction of her work of art so long as that work has achieved “recognized stature.” Here, the court followed the test announced by a district court in Carter v. Helmsley-Spear, Inc. for establishing “recognized stature” under VARA, whereby a plaintiff must show, first, that the artwork at issue has “stature,” meaning that it is “viewed as meritorious,” and, second, “that this stature is ‘recognized’ by art experts, other members of the artistic community, or by some cross-section of society.” In determining that 45 out of the 49 works in question had achieved recognized stature, Judge Block considered expert testimony as well as evidence of such factors as the artists’ recognition outside of their work on 5Pointz, “social media buzz” about the works, and whether the works had been selected for long-term display by lead plaintiff Jonathan Cohen in his role as quasi-curator of 5Pointz. While Judge Block stressed that “expert testimony is not the sine qua non for establishing that a work of visual art is of recognized stature,” he gave substantial weight to the testimony of plaintiffs’ expert regarding the technical skill employed in the creation of each work, the importance of 5Pointz as an aerosol art mecca, interest in the works from art world academics and professionals, and her own professional opinion that all 49 works were of recognized stature.
In awarding damages, Judge Block rejected the plaintiffs’ calculation of actual damages because the plaintiffs’ expert failed to account for the cost (or even practicality) of removing the works which had been painted directly onto the 5Pointz walls; did not provide sufficient evidentiary justification for the valuation for each work; and did not consider the narrow market for works as large as the 5Pointz works. While concluding that the artists had failed to prove actual damages, Judge Block underscored the importance of statutory damages to this area of law where actual damages are often difficult to calculate – and found that plaintiffs had earned the maximum amounts of statutory damages allowed under the Copyright Act for willful infringement of their rights.
In assessing statutory damages, Judge Block applied a six-factor test in which he analyzed “(1) the infringer’s state of mind; (2) the expenses saved, and profits earned, by the infringer; (3) the revenue lost by the copyright holder; (4) the deterrent effect on the infringer and third parties; (5) the infringer’s cooperation in providing evidence concerning the value of the infringing material; and (6) the conduct and attitude of the parties.” Judge Block found that the first factor weighed heavily in the plaintiffs’ favor due to Wolkoff’s willfulness in destroying the works. Though Judge Block stated that the second factor is not a clean fit for a VARA case, he found that Wolkoff indirectly profited by pushing the development project forward in the face of the VARA lawsuit – and directly profited by charging licensing fees to film at the site – and that therefore this factor also weighed in the plaintiffs’ favor. The third factor likewise tilted toward plaintiffs because the value of 5Pointz to their careers was significant – albeit difficult to quantify – and thus 5Pointz’s destruction was a loss. With regard to the sixth factor, Judge Block found that the balance of Wolkoff’s “problematic conduct” on one side and plaintiffs’ “dignity, maturity [and] respect” on the other tilted this factor decidedly in plaintiffs’ favor.
Most critically, however, Judge Block identified the fourth factor – the deterrent effect on the infringer and third parties – as “perhaps the most important factor in the case,” going on to elaborate:
Without a significant statutory damages award, the preservative goals of VARA cannot be met. If potential infringers believe that they can violate VARA at will and escape liability because plaintiffs are not able to provide a reliable financial valuation for their works, VARA will have no teeth.
Again pointing to Wolkoff’s lack of remorse, and citing Wolkoff’s conduct and testimony as demonstrating that he was “singularly unrepentant” and “remain[ed] undeterred,” Judge Block concluded that this fourth factor “could not cut more strongly in favor of a high statutory damages award.” At least twice, Judge Block noted that the value of the site had increased from $40 million to $200 million once Wolkoff had succeeded in obtaining a zoning variance to permit his redevelopment, and this doubtless played a role in the court’s calculation of an appropriate deterrent.
While Judge Block maintained an even-handed tone throughout his 50-page opinion (plus 50 pages reproducing the artwork in question), there was no mistaking that his decision was greatly influenced by what he termed the “insolence” that Wolkoff had displayed both in and out of court. Plainly, Judge Block was offended by Wolkoff’s precipitous decision to whitewash the walls of 5Pointz for no apparent reason just eight days after Judge Block had rejected the artists’ motion for a preliminary injunction, before Judge Block had time to explain that preliminary ruling in a written decision, and without giving the artists the 90 days’ written notice required under VARA. Similarly, Judge Block noted that, while Wolkoff had “in the main” told the truth in his trial testimony, the developer did not abide by Judge Block’s admonitions to answer questions directly and was instead “argumentative and prone to tangents and non-responsive answers.” Perhaps even Wolkoff now understands the first rule of court: don’t insult the judge.
This may not be the end of the 5Pointz dispute, as defendants have until March 14 to file an appeal. So long as Judge Block’s ruling stands, however, the decision sends a message that developers and property owners ignore VARA at their own peril. Perhaps the most important practical point can be found in a footnote Judge Block inserted at the end of the decision, in which he noted that disputes such as this one can be easily avoided by property owners’ obtaining a “written waiver of the artists’ VARA rights up front, as § 113(d) expressly contemplates.”
 Carter v. Helmsley-Spear Inc., 861 F. Supp. 303, 325 (S.D.N.Y. 1994) (“Carter I”), aff’d in part, vacated in part, rev’d in part, 71 F.3d 77 (2d Cir. 1995). Judge Block noted that Carter I “remains the seminal case interpreting the phrase ‘recognized stature.’” G&M Realty L.P., at *11.
 G&M Realty L.P., at *12-13. In making his determination for why four of the works did not achieve recognized stature, Judge Block cited the fact that they had not attracted “significant” third-party attention or social media buzz.
 Id. at *12. Judge Block went on to criticize defendants’ expert for both her restrictive interpretation of “recognized stature”—what Judge Block described as being akin to a “masterpiece standard”—and for her overly restrictive social media and academic search methodology.
 Id. at *15.
 Id. at *19. For all 45 works eligible for statutory damages, Judge Block granted the maximum statutory damages available – $150,000 – after finding Wolkoff’s infringement willful.
 Id. at *18 (citation omitted). Judge Block did not consider the fifth factor, which he found does not apply to VARA cases.
 Id. at *18-19.
 Id. at *19.
 Readers can also speculate what Judge Block had in mind when he referred to the new housing Wolkoff planned to build on the site at six different places in his decision as “luxury condos.”
 Cohen v. G&M Realty L.P., 2018 WL 851374, at *19 (E.D.N.Y. Feb. 12, 2018).
 Id. at *5 (E.D.N.Y. Feb. 12, 2018).
 Id. at *19 n.22. Similarly, in a Wall Street Journal article following the jury’s advisory verdict in November, Michael Salzman, co-chair of Hughes Hubbard & Reed’s art law practice, highlighted the 5Pointz developer’s missed opportunity to obtain waivers from each of the artists in order to protect himself from their assertion of VARA rights down the road.