This is the issue currently being considered in the US Congress through an attempt to introduce the Design Piracy Prohibition Act (Act). The Act was initially presented in 2006, but at that time the bill was criticized because the broad wording attempted to stop any design that was “substantially similar” to the original, which would capture both both knockoff and “inspired-by” designs. Furthermore, there was disagreement over whether or not fashion was something that required intellectual property protection. It was argued that fashion does not need IP protection due to the rapid change in designs and trends, and the lack of protection may actually serve to enhance competition and encourage designers to provide a continual turn over in designs. In April 2009, the bill was re-introduced into Congress in light of the recognition that fashion plays a strong role in the US economy and the increase in counterfeit merchandise results in lost revenues of $12 billion dollars annually.
The Design Piracy Prohibition Act would provide copyright protection for fashion designs, an area that traditional intellectual property laws have failed to protect due to the functional nature of clothing. Under the Act, designs would be treated as if they were original pieces of art, as opposed to functional pieces of clothing. Damages for breach of the Act are set at the greater of $250,000 or $5 per copy. Specifically, the Design Piracy Prohibition Act would amend the U.S. Copyright Act to provide a 3-year term of protection for registered fashion design. Interestingly, this is a very short term of protection, especially when compared to the 25 years of protection granted to registered fashion designs in Europe; however, one could argue that given the rapid turnover in fashion trends, a garment could be out of style long before the three years of protection lapsed.
The Act would protect only unique, original designs registered with the US Copyright Office, and would stop stores from selling clothing that is “closely and substantially similar” to an existing article of clothing. The Act would not stop the reproduction of a fashion trend, so it is, and will remain, legal for stores like H&M to sell garments “inspired by” famous fashion designers. Instead, the Act aims to stop stores, like Forever 21, which make almost exact knockoffs of famous designs because almost-identical copies may discourage people from buying the original articles which, in turn, may dissuade designers from creating new pieces. The “inspired by” designs take major fashion trends, for example ruffled blouses, and then create a variation of that trend, whereas knockoffs would take a ruffled blouse designed by a famous designer and reproduce that blouse almost exactly, but at a fraction of the cost of the original. But how do you draw the line between what constitutes an “inspired by” and a knockoff? One entertaining suggestion is the “squint test” which proposes that “if you have to squint to see the difference between a copy and the original, something is wrong, and copyright protection should kick in”. While the squint test may be useful, it is probably not the most legally sound test. Of course, practically, drawing the line between “inspired by” and knockoffs is a very difficult exercise. How much of a design is “closely and substantially similar” and how would retail stores like H&M and Forever 21 know when they had crossed the threshold into knockoff territory? While the addition of the word “closely” somewhat narrows the scope of “substantially similar”, it would seem as though it is nearly impossible to draw any bright line tests. Even under the Act, fashion design lawsuits may still have to be decided on a case-by-case basis.
In Canada, designers of mass-produced clothing do not receive full protection under the Copyright Act by virtue of section 64 which states that once a useful article has been reproduced with the copyright owner’s permission more than 50 times, it will not be considered copyright infringement if others make further copies of that article. The definition of “useful article” is generally accepted to include clothing, but recent case law has indicated that the “usefulness” of an article of fashion will turn on the facts of each case. Despite section 64, all is not lost for fashion designers; section 64(3) “protects an artistic work used as a trade-mark or for material that has a woven or knitted pattern that is suitable for piece goods or the making of wearing apparel” and purports to protect works used as a trade mark, even when used with a useful article. Under the Trade-Marks Act, a passing off action may be used to protect fashion designs, or, as attempted by Crocs Canada Inc., a claim that the features of the clothing are a distinguishing guise may be successful as long as the designer can show that the features are not purely functional or utilitarian. Lastly, designers could also turn to the Industrial Design Act, which grants the owner a monopoly on the use of that design for up to 10 years. In order to achieve protection, registration with the Canadian Intellectual Property Office is required and the application for registration must be filed within a year of the design becoming public. The Industrial Design Act will only protect ornamental and non-utilitarian features of the article.
The Design Piracy Prohibition Act is supported by several major fashion designers, largely because it is their designs that are most often copied; however, it is not always the major labels who are the victims. Recently, a strong similarity was discovered between a cocktail jacket designed by Toronto fashion designer Mercy and a jacket designed by the legendary Diane von Furstenberg (DvF). Mercy’s Spring 2008 collection consisted of original pieces in vintage-looking rose print and the cocktail jacket, carried at several New York stores and featured on one magazine cover, was the most popular piece. In Spring 2009, DvF introduced a similar jacket, which received a great deal of publicity and was featured on several magazine covers and was part of a storyline on the popular MTV show “The City”. The similarity between the jackets was brought to the attention of DvF and, to her credit, Ms. von Furstenberg acted quickly, firing the staff member responsible for taking Mercy’s design. DvF voluntarily compensated Mercy for an undisclosed amount.
DvF is not the only famous designer who has been accused of copying someone else’s design. In early 2008, a Swedish man claimed that Marc Jacobs had copied a souvenir scarf depicting a Swedish village that was originally made by his father in the 1950s. It has been argued that the image and the scarf are not actually protected by copyright, but rather are part of the public domain and thus allowed to be copied. Although there does not seem to be any reported outcome to this situation, it should be remembered that even if the Design Piracy Prohibition Act were to be passed, scarf designs would need to be registered and would only receive protection for three years.
The Design Piracy Prohibition Act is supported by the Council of Fashion Designers of America (CFDA), an organization whose Board of Directors is comprised of fashion heavyweights, such as Oscar de la Renta, Ralph Lauren, Vera Wang and Nicole Miller. The President of the board is none other than Ms. Diane von Furstenberg. Ms. Von Furstenberg aggressively protects her designs, which have a strong celebrity following, and DvF has filed several lawsuits in the past. In 2007 DvF unsuccessfully attempted to sue fashion chain Forever 21 for copyright infringement after Forever 21 sold an almost identical version of a DvF dress (it’s interesting to note that Forever 21 has been sued 50 times for copyright violations!). Lawyers for DvF argued that customers were more likely to be confused into thinking they were buying the high-end designer version at a retail outlet, as opposed to buying a counterfeit knockoff on a street corner. While this may be a reasonable argument, it seems as though the court was reluctant to grant intellectual property protection to fashion designs. The Design Piracy Prohibition Act specifically intends to stop retail chains from selling almost exact knockoffs, so if the bill is passed, Forever 21 may want to start selling clothing that was “inspired by” famous designers, instead of selling clothing that rips off designers.
With such recent outcry by fashion designers in the US, it is almost surprising that Canadian designers have been relatively silent on the issue. It will be interesting to see the outcome of the Design Piracy Prohibition Act and whether it will inspire Canada to create additional intellectual property protection that specifically covers fashion design.
7 Responses
Thankfully, Congress has so far resisted attempts at further exclusive intellectual rights in this area.
Indeed, the fashion industry has been vibrant and creative despite the general lack of exclusive rights: a strong example of an industry that can thrive without the need for government-created artificial scarcities.
The fashion industry should not fall victim to the same phenomenon that occurred in other areas: the players that have managed to become large and profitable within a viable industry (despite the contemporary lack of exclusive rights) decide that it is more profitable to lobby than to innovate – at that point they ask the government to “protect” them.
Such laws do not, and will not, result in a greater number of fashion items being created. It will only create a situation of rent-seeking, and inefficient litigation.
Artificial scarcities should always be looked-upon with a very skeptical eye – and even more so when they are government created.
With the flood of off-shore piracy products over the past couple of decades, I think that the pressure on fashion designers to stay ahead of the piracy game is making a profitable life in this industry increasingly difficult. While the current state does not preclude people from entering the fashion industry and most likely will not decrease the overall number of fashion items being churned out every year, there are more abstract concerns about the quality and the future of the industry.
[At this point I will unfortunately have to use a non-fashion example, as fashion is not really in my vernacular knowledge] If copyright for music never existed, would the next Beatles put in the same effort to express their genius if there was no economic incentive? Would they bother nursing their talent when the local pub’s John Doe cover band could just take their songs and make just as much money as they would? Of course there would be those would take the sacrifice for the sake of the industry or art, but what about all of those with potential that turn away? At the end of the day they need to put food on the table. If their expertise is not bringing home the bacon, they will have to turn their time and effort elsewhere. The “chilling effect” is often a phrase used to describe this situation, and with the increasing ease of piracy in all its forms, this effect seems to be a potential reality for industries like fashion. By enacting the Design Piracy Prohibition Act, it would help to nullify the chilling effect and foster enhanced creativity and forward movement in the industry.
This is not to say that the industry deserves unbridled protection. A 3-year copyright seems like a good compromise. Enough time for the designer to enjoy the fruits of his/her labour, but not necessarily enough time for them to develop an anti-competitive monopoly over the industry. While there are obvious economical benefits for the consumer for enjoying an unfettered competitive fashion industry (eg. cheaper clothing), society runs the long-term risk of losing the benefits of a creativity pool that is encouraged to express themselves and challenge society to grow and move forward.
The same rhetorical-style questions as to whether X would have been created were it not for copyright can be turned around: What has not been created because of copyright (or the duration/scope/etc. of copyright)? To what work (that would serve as inspiration) was a potential future artists not exposed? Or of what brilliant derivative works have we been deprived? What software has not been created and enhanced our day-to-day lives?
Many musicians and artists do not make a penny from copyright-granted rights, and continue to create original works, despite the knowledge that they will probably never make a living from their expression. They don’t do it because they’re waiting for the lottery-like payoff. They all do it because they love to create. Would Lennon have gone into accounting if he couldn’t make the big bucks in music? Who knows? (Aside from the fact that there was always the possibility of making money from concerts, etc.) If anything, it would appear that artists who would not have created but-for the existence of government-granted exclusive rights are truly in the minority.
Furthermore, the absence of copyright does not prevent other business models from succeeding. To put forward one example Denis Barbosa provided on this web-site, Bach did not rely on artificial scarcities to make money, and yet created vast amounts of original works. A modern-day example of a musician is Trent Reznor (and there are many, many more). As Brian Eno remarked recently: while sales of copies of music works may be down, music-making and live playing is at incredible levels (and lends support to Barbosa’s hypothesis).
To address the matter at hand: the goal of copyright should be to incentivize creative expression. To the extent that it is not necessary to do so, it should not exist. Only if it is shown that
i) fewer fashion “works” are being created, (not by one or two companies, but by the industry as a whole),
ii) such a diminution is *specifically attributable* to copies being made (and to the extent that existing IP rights, e.g. TMs are insufficient to prevent such copies), and
iii) if society agrees that the harm of such exclusive rights – monopolistic pricing and resulting dead-weight losses – is outweighed by the benefit of the potential increase in the number of works,
should further exclusive rights be granted.
Not an easy calculus.
While perhaps overly libertarian for Canada, the starting position should always be no government intervention. The case for government intervention should always be made by those who would seek it – not vice versa.
I appreciate that you contemplate a very limited time period. However, in the fashion world, 3 years is a life-time. And why the arbitrary 3 years? What study has determined this to be the smallest necessary amount? Furthermore, history has shown that once such exclusive rights are created by a government, they are never diminished, and always sought to be expanded.
Furthermore, I submit that copyright does not (in itself) promote “quality” of the created expression any more or less than non-copyright. In this sense, it is “quality” neutral (everything receives protection, regardless of its quality). If anything, economic theory would suggest that it promotes “popular” expression. (Although I have heard excellent defences of the proposition that popularity equals quality).
Mr. Kaufmann,
You have made some very interesting points and I thank you for your insights. I agree that 3 years seems particularly arbitrary, especially in light of the fact that Europe has a 25 year protection, so it seems difficult to fathom that the US is trying to follow Europe’s protection.
I was wondering if you had any thoughts on whether Canada may decide to follow suit and attempt to create some sort of specific IP protection for fashion designers here as well? Or do you think the range of protection that is currently awarded under the different Acts (TM Act, Copyright Act, Industrial Design Act) is sufficient protection?
Ms. Branch,
While I am of the opinion that existing rights are more than sufficient to maintain a creative and competitive fashion industry, this is not to say that nobody will ever convince Canadian policy makers not to legislate such protection (though I imagine that the US would come first).
While this has not made it onto my radar, it is unlikley that Canada would create such a scheme on its own initiative. However, I can speculate about the most likely manner in which this could be introduced in Canada: policy laundering.
A section of the fashion industry, or even one specific company, convinces a party to a trade agreement with Canada (e.g., EU) that such protections are a necessary component of the trade agreement. As entering into such agreements remain the prerogative of the Crown, these may be accepted without any significant public debate. [A brief time trip back to the US-Canada Free Trade Agreement (and the resulting changes patented medicines) show how such things can slip in]
Following such an agreement, pressure will be placed on Canada to implement those provisions into law (if it does not do so right away). If the issue even makes it into the mainstream media, arguments such as “we have to – we have signed an agreement” will be used to to politically persuade people that the legislature should abdicate its decision making capabilities in favour of implementation of the trade agreement.
Mr. Kaufmann,
Thank you very much for your insights, it’s very interesting to hear about the ways that this type of protection could be slipped in to Canadian law!
http://www.thestar.com/article/836492–geist-why-parma-ham-stands-in-the-way-of-two-major-trade-agreements
“The latest round of CETA negotiations took place last week in Brussels, with the GI issue (along with protections for industrial designs that cover the fashion industry) a top priority for the European delegation. The Canadian government unsurprisingly faces some opposition to the demands from domestic producers.”
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