Art & The Infringement Culture
The phrase “copyright infringement” often conjures up visions of Chinese factories and dusty marketplaces in India with fake Gucci bags and counterfeit iPod accessories making the rounds. In reality, the practice of copyright infringement has become a striking and integral part of the business model of many retail companies based right here in the good ole’ US of A. Some of the biggest retail offenders are making billions of dollars violating the rights and talents of real artists who are trying to make a livelihood doing what they love. And it doesn’t seem to have any end in sight.
Many true artisans, who have worked diligently in creating unique works and establishing their goodwill in the industry, have been ripped off by “big box” American companies. For example, Urban Outfitters, a $2.8 billion company, has established quite a reputation in the commercial art industry for selling products that are suspiciously similar to artists’ original works. Large offenders have their retail stores, both brick-and-mortar and web-based, at the ready to accept knock-off lines of products and have the ability to perform quick turn-around production. These companies have been accused of having “design scouts” who attend national trade shows to steal the original designs of artists and take them back to their home base for reproduction.
So, while the big box company creates an “instant” product and avoids paying licensing or procurement fees, the original artist is faced with confused retailers who wonder why their sales of the original product are being undercut by a cheaper, inferior version. By the time the artist has realized what’s happened, the product has been sold and marketed nationwide, eroding the unique nature of the original work and the goodwill of the artist’s business. Sometimes the original artist is even rumored to be the infringer.
While some artists are flattered by knock-offs of their products and designs, more and more of them are experiencing feelings of being violated when their artwork and designs are knocked off, especially when the infringer is the only one profiting. Laura Zindel, the owner of Laura Zindel Design, a small Vermont-based ceramic design company, was recently a victim of infringement by a large, $30 million company. She explains, “In a very direct way, this knock-off cheapens what we have worked so hard to achieve: quality products made in the USA at a reasonable price. The infringement of our line has undermined the hard work that we put into developing, designing, producing and marketing our line for over fifteen years. For a large company to simply reproduce our line and to say that it was there for the taking is reprehensible. A lot of my time and energy has gone into the backlash of this, and it has monopolized months of my valuable time that should have been spent running my business and creating new works.” The frustration and weariness is often palpable.
The doors of opportunity for infringers have been blown right off their hinges by internet-based companies, such as Ebay and Etsy, who are able -quite legally- to turn a blind eye; just take a quick look at Alibaba.com and the problem can’t help but smack you right in the face with its absurdity. One must truly be living under a rock to not know how the internet age has changed the face of intellectual property theft. The often laissez-faire attitudes of many internet retail companies towards knock-offs and creative theft simply compound this infringement culture. For example, in 2003, Tiffany, Inc., discovered that over 70% of the “Tiffany” items being sold on Ebay were knock-offs. Tiffany, after urging Ebay to address the problem and failing, sued Ebay in a landmark case. The Court determined that Tiffany, not Ebay, had the burden of policing the Tiffany intellectual property. Ebay claimed that its VeRO infringement reporting program was sufficient to address the problem. So let’s see how well that VeRO program works – take the Paul Richmond matter, for example. Paul’s friend noticed knock-offs of Paul’s (definitely unique) gay erotic paintings on Ebay. Paul determined that a good number of his paintings were being reproduced in China. Paul used Ebay’s VeRO program to report the infringement, and Ebay removed the post. Only to allow it to be posted again in a week under a different title. Almost two years later, and after many Ebay VeRO reportings, Paul’s paintings are still being sold on Ebay by the same infringer. You can read Paul’s (sometimes hilarious) story on his blog at http://paulrichmondstudio.blogspot.com/p/ive-been-bootlegged.html.
Oh, Etsy. I sometimes wonder if the first ever blog post was written to complain about knock-offs on Etsy. It seems to go that once you post on Etsy, you open your work up to a free-for-all, somewhat akin to using a sketchy Chinese manufacturer. Etsy is chock full of “hobbyists” selling handmade items, many of which are copies of works by career artists, down to the positions of the items in the photograph. I do hope that Etsy will address this problem, as many artists are very hesitant to use Etsy to sell their designs because of the prevalence of knock-offs on the site.
When confronted with allegations of infringement, most of these companies are dismissive of the artist’s rights and simply offer a small payout to the artist. For example, I recently dealt with an infringement matter where the infringer had, for the second time, knocked off my client’s designs. The infringing company’s attorney referred to the infringement as a “trivial matter” and a “minor controversy”. My client disagreed-when the company’s catalogue went out to thousands of their customers nationwide with knock-offs of her unique designs, her company’s goodwill was eroded and the value of these original luxury pillows was irreparably damaged.
Where are the Solutions?
A significant variable in this infringement culture issue is a lack of education for artists and small businesses about intellectual property, which can be up to 75% of a small company’s value. While large, established companies have the financial capacity to hire teams of attorneys and legal consultants to help them navigate choppy intellectual property waters, small businesses are left to their own devices, and get easily tangled up in the plethora of myths and misinformation about copyrights and intellectual property law.
Our Attorney General, Eric Holder, has said that, “intellectual property theft is not a victimless crime. It can devastate lives and businesses…” Yet, there does not appear to be any plans to help the little guys who hold our country’s economic viability on their shoulders. Our government has been so focused on China and India and their roles in the theft of intellectual property that it has failed to turn its eyes in on itself to address the problem residing right here at home.
Small businesses make up over 99 percent of U.S. employers, and the U.S. home goods and housewares industry is a $26 billion dollar industry (in comparison, the music industry’s revenue in 2012 was less than $17 billion). Almost 70% of home goods and housewares companies employ less than five employees. With these statistics, one would think that the government would turn its attention to aiding the commercial art industry in learning the laws that surround and protect them and providing small businesses with pertinent information. So where’s the education for these businesses, when the health of many small companies hinges on the protection of their intellectual property?
Most artists and small creative business owners do not realize that, in order to substantively protect their creative and original works via copyright and to collect statutory damages for infringement (which can be up to $150,000), they need to obtain copyright registrations, when appropriate, within a specific time frame. When an artist or small business is ignorant of this law, the artist is not entitled to statutory damages and is stuck trying to prove actual damages, consisting of the infringer’s profits and the artist’s losses, which frankly is akin to trying to prove a negative. No large retail company that has stolen from an artist is going to hand over accurate sales records, and would rather sell their children than admit that they made any money from an infringing product. Therefore, with no statutory damages available to the artist, no attorney will touch the case on contingency, the artist can’t afford high legal fees to sue for copyright infringement, and if the artist is lucky, he’ll walk away with a couple thousand dollars. It’s really no surprise, then, that many artists address the issue of copyright infringement by scrambling to constantly stay ahead of the game by churning out new product designs and selling their soul (unwittingly) to the big box company’s devilish representative.
Additionally, with the prevalence and popularity of the DMCA takedown notice policy, many artists and small businesses mistakenly believe that using this tool is their one and only go-to solution. What they fail to recognize is the damage to their brand and, more importantly, that such a whack-a-mole “solution” is hardly a solution at all; it simply allows the infringer to repost the infringing image or product elsewhere and to keep all profits from the infringement.
It is this attorney’s view that if the United States wants to genuinely promote itself as supportive and encouraging of small businesses, this “elephant in the room” infringement issue must be substantively addressed on several levels, the most important of those being education on intellectual property laws and practical methods of prosecution for intellectual property infringement. Alternatively, the United States should work to make substantive yet practical changes to the U.S. Copyright Laws that reflect the changing atmosphere of intellectual property theft, along with an understanding of those who would benefit from a more practical of the law.