19 April 2017

Copyright, Moral Rights, Charging Bulls, and Fearless Girls

Let's talk bulls. 

Specifically, let's talk about why the creator of a sculpture of a bull that may be better known for having it's big bronze balls rubbed than for its artistic merit may have a very strong copyright infringement case against the investment firm that commissioned another, more recent sculpture of dubious artistic merit, and possibly against the City of New York as well. And when I say "very strong," what I'm saying is that either someone at the investment firm consciously decided to accept a significant legal risk, or they failed to seek competent legal advice before commissioning their sculpture. 

From an IP lawyer's perspective, any lawsuit that is filed over this incident will be watched very carefully. The facts involved in this dispute raise quite a few questions of first impression for US courts, particularly where moral rights and fair use are concerned.  A number of people have already given their opinions of the case, with some saying that the artist has a strong case and others of the view that he has no case at all. In my view, there's a solid case for copyright infringement and for infringement of moral rights, but there's also a strong fair use defense on both counts. On the whole, it's one that could go either way. The only thing I'm sure of is this: it's going to be - if filed, of course - a fun case to watch.

The backstory, in brief:

In 1987, an Italian sculptor named Arturo Di Modica, moved by what he saw as America's resiliance in the face of a financial crisis, decided to create a tribute. Over the next two years, he raised money, sculpted an 11-foot tall, 1.5 ton bronze sculpture of a charging bull, and - without a permit, but with the help of 50 or so of his closest friends, a forklift, and the remarkable lack of vigillance of the New York Police Department - installed the sculpture in front of the New York Stock Exchange in the middle of a December night in 1989. After a bit of initial controversy, the sculpture was given a permit and has been allowed to remain in that spot ever since. Over time, it's developed a patina (except over its carefully sculpted testes, which are rubbed for luck by stockbrokers and tourists), and become part of the Wall Street landscape.

Last month, a Boston asset management firm commissioned a life-size sculpture of a little girl, arms akimbo, firmly staring forward with her pony tail and dress blowing out behind her. They had the sculpture placed directly in front of the Charging Bull, along with a label that advertises one of their funds. This sculpture was intended to remain in place for one week, but was also an immediate hit with tourists. As a result, New York City recently announced that they have issued a permit allowing Fearless Girl to remain where it is until at least 2018. 

And Di Modica is freaking out. The 76 year-old sculptor, represented by well-known civil rights attorney Norman Siegel, held a press conference last week. At the press conference, a "distraught" Di Modica demanded that the city remove the sculpture and pay damages for violating Di Modica's intellectual property rights. 

Di Modica's likely claims:

The IPKat has a copy of the letter of complaint that Di Modica's attorneys sent to New York City. The letter does not specify exact causes of action the same way that a complaint will, but there's enough in there to give us a sense of what will likely be in play if he files suit. (And, for reasons that I'll get to later, I think there's a strong possibility that this will wind up in court.)

Based on the letter, Di Modica is positioned to claim at least three separate violations of his intellectual property rights:

  • A claim for copyright infringement under 17 U.S.C. §106, on the basis that Fearless Girl is an unauthorized derivative work.
  • A claim for infringement of moral rights under 17 U.S.C. §106A, on the basis that Fearless Girl changes the meaning of Charging Bull in a manner prejudicial to Di Modica's honor as an artist.
  • A trademark infringement claim brought under the Lanham Act. 
In this post, I'm going to deal with the copyright claims only. The trademark claim will require a whole different analysis, and this post is going to be long enough with just the copyright stuff. 

First, let's start by listing the legally relevant facts, to the best of our current knowledge. I'll point out facts that may be disputed as we come to them. Unless otherwise noted, facts are taken from the letter of complaint.

Key Facts:

  • Di Modica a copyright registration for Charging Bull, which was issued before the Fearless Girl sculpture was created. 
  • Di Modica owns Charging Bull. This fact may be disputed if the case goes to court, on the basis that Di Modica said that the statute was a "Christmas gift" to the city. However, it appears that the City probably does not have title. Di Modica tried (unsuccessfully) to sell the statue in 2004, and it appears that the statue is still permitted to remain at its current location on a "temporary" basis. 
  • State Street Global Advisors commissioned the Fearless Girl statue.
  • Fearless Girl was placed with NYC permission.
  • Fearless Girl was placed on a temporary extension of the cobblestone traffic island that Charging Bull sits upon. (Visible in the picture at the top of this article.)

Infringement of Exclusive Rights Under 17 USC §106:

Virtually all the commentary I've seen on this dispute focuses on the issue of moral rights, but I think there's a solid economic rights claim as well. 

Di Modica will likely claim that Fearless Girl infringes his exclusive rights under 17 USC §106(2), which gives copyright owners the exclusive right "to prepare derivative works based upon the copyrighted work." This is made clear in several places in the letter of complaint:
"The statue of the young girl becomes the "Fearless Girl" only because of the Charging Bull: the work is incomplete without Mr. Di Modica's Charging Bull, and as such it constitutes a derivative work of the Charging Bull." (p. 1)
"Furthermore, SSGA and McCann New York made conscious decisions to visually link the young girl statue to the Charging Bull...they extended the cobblestone paving...into the adjacent plaza. In so doing [they] created another unifying element between the Charging Bull and the young girl that serves to transform the young girl into the "Fearles Girl." (p. 2)
"In effect, the Charging Bull has been appropriated and forced to become a necessary element of a new, derivative work: "Fearless Girl: Girl Confronts Charging Bull." (p. 2)
If Di Modica can show that Fearless Girl is a single work that combines the girl statue and the Charging Bull statue, he will have established that the new work is a derivative of Charging Bull. (It's also possible that he can prove that it's a derivative even if they're not a single work, but that's more than I'm going to get into here.)  I think he's got a fairly good shot at showing that the two are one work. 

There's not a lot of case law on how to determine when something is a single work or multiple independent works, but there are a couple of cases, including one from the Southern District of New York. In Carter v. Helmsley-Spear, 861 F. Supp. 303 (SDNY 1994), the court had to address a claim that a "number of sculptural elements" in the lobby of a building were a single work. The court found that the works appeared to be interrelated, that they shared thematic elements, and that the artists had consciously worked to ensure that the different elements "worked together." (861 F. Supp at 314-15). On that basis, the court found that the bulk of the elements formed a single work. That decision was overturned on appeal on other grounds, but the 2nd Circuit endorsed the District Court's determination that a "thematically consistent, inter-related work whose elements could not be separated without losing continuity and meaning" was a single work. Carter v. Helmsley-Spear, 71 F. 3d 77, 84 (2nd Cir 1995). 

If that's the test applied to this case, Fearless Girl has some problems. The pairing is thematically consistent - it's a small girl staring down a charging bull. It's inter-related - not only are the two sculptures positioned on the same surface, but an extension of the surface was constructed specifically to accommodate the girl sculpture. The elements are not separable without losing continuity and meaning. Based on the news reports, it should not be difficult to prove that there was an intent to use Charging Bull as the focus for the girl's fearlessness. If she's positioned somewhere where she isn't staring down something, she has nothing to be fearless at. And if she's positioned in front of a different focus (City Hall, the White House, etc), she's no longer fearless at the same target. 

It's not a slam dunk. But I think the evidence of intent to make use of Charging Bull in positioning the girl is likely to overcome any hesitation that might result from theoretical separability. Overall, I think it's likely that the Fearless Girl installation will be found to be a derivative work that incorporates Charging Bull. 

This does not mean, of course, that Di Modica will win. An unauthorized derivative work is an infringement, but, as every American IP lawyer knows, fair use is a defense to infringement. 

The fair use factors are well known:
In determining whether the use made of a work in any particular case is a fair use the factors to be considered shall include—
(1) the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes;
(2) the nature of the copyrighted work;
(3) the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and
(4) the effect of the use upon the potential market for or value of the copyrighted work. 17 USC §107.
The first factor will clearly favor Fearless Girl. Courts assessing this factor look to see if the new use is "transformative" - that is, does the new use simply "supersedes" the original, or if it "adds something new, with a further purpose or different character, altering the first with new expression, meaning, or message." Campbell v Acuff-Rose, 510 US 569, 579 (1994). That's a given in this case - the transformation of the purpose and character of Charging Bull is why Di Modica is so pissed off in the first place. And it's clear that transformative works "lie at the heart of the fair use doctrine's guarantee of breathing space within the confines of copyright." Id. 

The first factor will strongly favor Fearless Girl. The second, and probably the 4th, not so much. Charging Bull is a purely artistic work, which is at the core of copyright, so the second factor will (as it almost always does) favor plaintiffs. The fourth will probably also favor plaintiffs, although it's a closer call. The key question for the 4th factor typically involves market substitution. In this case, the original sculpture has been entirely (and involuntarily) incorporated in the new work. It has been replaced by the new derivative. Parodies that reduce the demand for the original because they're effective are usually viewed favorably on 4th factor analysis, but I don't think there's ever been a case where the claimed fair use effectively removed the original from the market before. Ultimately, I think that's likely to be decisive, particularly if the court takes into consideration State Street's intent to use the new work to market a fund.

The third is going to be very difficult to analyze. Fearless Girl is arguably a parody, and it's clearly a commentary on the original, but it's also one that has arguably been constructed with a purpose of advertising a product rather than strictly for its own sake. Parody for parody's sake tends to push toward fair use, even when 100% of the original work has been used. Parody to sell something else is much less clear. This is likely to be the decisive factor in the fair use analysis, and I have no idea how it will come out. 

Overall, I think Di Modica is more likely than not to show that Fearless Girl is a derivative work, and (to paraphrase the immortal Leo McGarry) it's 6 to 5 and pick 'em on the fair use defense.

Infringement of Moral Rights Under 17 USC §106A:

In addition to the economic rights claim, Di Modica will probably also bring a claim for a violation of his moral rights. Moral rights are a central component of copyright in many civil law jurisdictions, particularly in Europe, but they are a recent addition to American law. When we ratified the Berne Convention, we were required to ensure that:

author[s] shall have the right to claim authorship of the work and to object to any distortion, mutilation or other modification of, or other derogatory action in relation to, the said work, which would be prejudicial to his honor or reputation.
Berne Convention, Art 6bis
That requirement is difficult to incorporate in the already closely-balanced relationship between 1st Amendment free expression rights and copyright, but we ultimately enacted the Visual Artists Rights Act (VARA), which provides in relevant part that:

(a)Rights of Attribution and Integrity.—Subject to section 107 and independent of the exclusive rights provided in section 106, the author of a work of visual art—
(3) ...shall have the right—
(A) to prevent any intentional distortion, mutilation, or other modification of that work which would be prejudicial to his or her honor or reputation, and any intentional distortion, mutilation, or modification of that work is a violation of that right,
17 USC §106A
This provision came into effect in 1990, and there is absolutely no American case that is close to a match for the facts involved here. We're in uncharted territory, and I don't think it's possible to predict how the case will turn out. 

That's particularly true since there's a major distinction between the facts involved with these statues and cases like Helmsley-Spear or Phillips v. Pembroke Real Estate, 459 F. 3d 128 (1st Cir 2006), where courts refused to allow authors to invoke §106A: in those cases, the authors were attempting to invoke moral rights to prevent property owners from making changes to real estate. We don't have that with Charging Bull. That may be very important. This isn't a case where an author is trying to force someone to leave a building unchanged to protect a work of art; it's a case where an author is objecting to the appropriation of his work of art into a new work. I can see a court deciding that this is a case that falls much closer to the core of what moral rights are intended to protect. 

As far as the merits of moral rights go:

On the facts that are listed above, Di Modica can almost certainly show that he is the author of a covered work of visual art, as defined in 17 USC §101. That leaves two remaining elements. Di Modica must show that:
  • Fearless Girl is a "distortion, mutilation, or other modification" of Charging Bull; and
  • That the modification of Charging Bull is "prejudicial to his or her honor or reputation."
I the interests of full disclosure, I've been involved (and may have instigated) a few debates over whether Fearless Girl is a modification of Charging Bull. I think it is, at least under American law; but I doubt I'm in the majority on that view. It's certainly true that there have been absolutely no physical modifications to Charging Bull of any kind, so if a court rules that physical alteration is required, Di Modica will lose the moral rights claim.

That said, the legislative history of the bill suggests that derivative works are modifications:
with respect to modifications of a work, only an artist who retains the copyright in his or her work is able to invoke title 17 rights in defense of the integrity of that work, and then only where a modification amounts to the creation of a derivative work. H.R. Rep 101-514 (1990 U.S.C.C.A.N. 6915, 6918)
To me, this suggests that if Fearless Girl is a derivative work, she's a modification by definition. That conclusion can only be bolstered if there's a fair use defense - it's hard to simultaneously argue that you're transforming something and yet not modifying it. This is another area where I think the extension of the cobblestone will ultimately be important. Charging Bull was not physically modified, but the surface that Charging Bull is standing on was physically extended specifically to permit the placement of Fearless Girl on the same surface. 

At a minimum, I think there's a solid argument to be made for modification. 

Prejudicial to the artist's honor is another area where there's not a lot of case law to draw from. The best discussion I could find was in a recent 1st Circuit case, Massachusetts Museum of Contemporary Art Foundation v Büchel, 593 F. 3d 38 (1st Cir 2010). The court in that case didn't provide any bright-line test for prejudice, but it did suggest that the bar for showing this treatment may be very low, and that a showing that unfavorable reactions resulting from the modification might be enough. 

I suspect that some of New York City Mayor Bill de Blasio's Twitter output may make an appearance as evidence of actions prejudicial to the artist's honor:
That's the fun thing about Twitter, of course: it pre-positions your mouth right where your feet will be later. 

I'm not going to pretend to know how the moral rights claim will go, but I think there's at least enough of an argument to require a court to put a great deal of thought into a very new area of law.

But wait, we're not done yet!

Even if there's a violation of moral rights, we still have to deal with fair use - the §106A rights are explicitly subject to §107. I already went through the fair use analysis, and I'm not going to repeat those details. But there are two additional factors that will complicate any fair use analysis: there's a total lack of case law on how fair use and moral rights interact, and (more importantly) there's legislative history that suggests that the nature of protected visual art weighs against fair use:

Fair Use.–Section 7 of the bill amends 17 U.S.C. 107, and states that section 107's fair use provisions apply to violations of new section 106A as well as to violations of section 106. The Committee does not want to preclude fair use claims in this context. However, it recognizes that it is unlikely that such claims will be appropriate given the limited number of works covered by the Act, and given that the modification of a single copy or limited edition of a work of visual art has different implications for the fair use doctrine than does an act involving a work reproduced in potentially unlimited copies
H.R. Rep 101-514 (1990 U.S.C.C.A.N. 6915, 6932)
I've got no idea how the moral rights claim might turn out, and even less idea how a fair use defense will turn out. If there's a case, it's got the potential to be groundbreaking.

Will He Sue?

Throghout this post, I've assumed that there is going to be litigation in this matter. I think there's a strong possibility that there will be.

Di Modica is clearly unhappy about the situation. He's also sued people over Charging Bull at least twice in the past. In 2006, he sued WalMart (and a bunch of others) over their use of photographs of Charging Bull. In 2009, he sued Random House over their use of photographs. And he's currently represented, and his lawyers are making a very public stink over the affair.

On the flip side, Bill de Blasio has already made the City's position clear:
I can't see him backing down. It's an election year, he's got enough trouble already, and he has much more to lose by backing down and potentially pissing off voters than by standing his ground over what is easily depicted as unreasonable demands by an artist.

All in all, I think there's a strong chance that this will become a litteral federal case, and sooner rather than later. When it does, and no matter who ultimately prevails, new legal ground will be broken. 

13 March 2017

Why the doomed #revote2017 campaign matters.

This is a post about a failure that will be announced to the world early next week. 

A group of individuals launched a legal challenge to the 2016 presidential election before the inauguration. I'm calling it a legal challenge and not a "lawsuit" for reasons that I'll get to in a bit. For now, let's just say that the case was legally hopeless from the very start - and that was before the people who filed it invented new ways to get legal procedure wrong. On Friday, the Supreme Court of the United States will vote to put the final nail in the coffin of this case, and early next week the results of that vote will be officially announced. 

Despite the inevitability of the failure, this is something that we should be paying attention to. The pattern of promotion and fundraising we've seen with this case, which has been branded as #Revote2017 by its proponents, is one that I'm confident we will see again. 

For those of you who are unfamiliar with the Revote2017 campaign, here's a very brief rundown: 

A group of individuals, proceeding pro se (without a lawyer), asked the1st Circuit Court of Appeals for a Writ of Mandamus barring Trump's inauguration and asking that the court declare that "persons who exercised election related powers" in 2016 "failed to fulfill the spirit and intent" of the law. The 1st Circuit, in a one-paragraph order, rejected the request within a day. The individuals then appealed to the US Supreme Court. That was on January 18th.

The Supreme Court's wheels grind slowly, so the case has been slowly moving through the system ever since. The people who filed the case have used that time to engage in constant promotion of their efforts via social media, particularly on Twitter. They are pitching their case as something that might get a new election, stirring up hope among some of the more credulous on the left. 

The more credulous, in this case, include at least one celebrity. Rosie O'Donnell has been supporting the Twitter campaign built around this hopeless exercise. The proponents of the campaign, meanwhile, have been using the Twitter campaign to sell this false hope for real money. They have a GoFundMe campaign running, with over $25,000 raised. $10K of that is apparently from Rosie; other donors have included people who say they are on a fixed income. It is unclear how this money is being spent, or what will happen to it after the Supreme Court kills the case in a few days. 

So what does this teach us?

If nothing else, this confirms something we already know (or at least should) - that we should not be looking at the tendency toward bubble-driven thinking as a sin of the right, but as a broader problem. What we see with the Twitter campaign around Revote2017 is classic groupthink. The true believers reinforce each other both positively and through rejection of anyone who tries to inject an alternative perspective. 

This, in turn, is something that people can leverage as a source of income. At this point, I have no idea whether or not the people who filed the case are soliciting funds in good faith. I'd like to believe that they are, but they are making it difficult. Their actual expenses are likely to be very low - the Supreme Court requires a set number of filings printed to very exacting standards, which isn't cheap, but actual evidence of additional expenses is absent. They've claimed to have filed additional requests with the Supreme Court, but those requests don't appear on the docket. They have said that expenses involve lawyer fees, but the Supreme Court docket lists no lawyer. Good faith or not, the ultimate effect is the same - people have been given hope, they are investing in that hope, and they will feel very let down in a few days. 

That's bad because we need people to become more involved, not less. Yanking people around and letting them down is a surefire recipe for discouraging future involvement. Taking people's money in exchange for a false hope is not a viable way of building a strong, organized, motivated electorate. 

So what can we do about efforts like this?

This is another of those areas where no one person can possibly do enough, but there are lots of little things that different people and institutions can do. I'll start with the things that specialized institutions can do, and work on through the list to the things all of us should be doing.

The legal profession:

I'll start with the courts, in the unlikely event that a clerk or judge reads this, because there is something the courts can do. The 1st Circuit dealt with this case very preemptively. The entire denial was less than one page long, and included the sentence, "Petitioner cites no precedent legitimately supporting her novel constitutional claim, and we see no basis for concluding that there is a clear entitlement to relief."

A lawyer's immediate reaction to the phrase "novel constitutional claim" is ingrained early in the legal education process:

Pro se litigants aren't necessarily going to pick up on the burn of that statement the way that lawyers do. We get that courts run on precedent, and "novel" or "unprecedented" aren't words that usually signal success. Normal people can easily see "novel argument" and read it as a sign that they're blazing new ground, that they're revolutionary trail breakers. 

Courts need to recognize that, particularly in the crowdfunding era, there may be people beyond the named litigants with a stake in a pro se case. Courts should be at least alert to the possibility that a hopeless pro se case might be used as a vehicle for financial gain. Taking a small amount of extra time to re-craft language used in boilerplate denials of pro se cases to make things more clear to people without a legal background may make it easier to fight efforts to use the cases for financial gain. 

State Bar Associations and regulatory bodies also have a role to play in combatting efforts to raise money from hopeless pro se cases. Collecting money from other people to advance a pro se case may implicate unlicensed practice of law concerns, particularly if money is being collected far in excess of likely actual expenses. It may be necessary for licensing authorities to pay more attention to these efforts, particularly given the possibility that many donors may fall victim to these efforts. In addition, the authorities in individual states need to be prepared to collaborate more closely on these issues; online fundraising efforts will generally not respect state or national boundaries.

Local authorities should keep cumulative effects in mind when they consider these problems. Individual fundraising campaigns may be relatively minor. Individual losses may be restricted to $10 or $20 per person. But the number of individuals affected could cumulatively result in a loss of respect for the law and the legal profession. The corrosive effects of many small incidents spread across the country should not be underestimated.

Bar Associations should also be alert to the possibility that individual lawyers may lend their names to pro se efforts without formally entering an appearance in the case, or placing their name or signature on any filing. Licensing authorities should take steps to ensure that any lawyer assisting pro se litigants is meeting professional responsibility standards, particularly when money is being raised to advance the pro se case. 

Individual lawyers, and particularly those of us who are active on social media, should stay alert for efforts to raise money for hopeless pro se cases. We should not remain silent in the face of such efforts. We should not be afraid to bring concerns to appropriate authorities. Whenever possible, we should take the time to explain the issues as simply and clearly as possible. 

All of us:
The efforts to advance hopeless pro se cases are just another form of challenge to reality-based living, and we should treat them as such. When someone asks you to contibute to a lawsuit that has no lawyer, look at the situation very closely before you proceed. If a friend is becoming invested in such a cause, talk to them. Individually, none of us might be able to do much; collectively, we can do a lot. 

We also should not be afraid to call out celebrities who lend their megaphones to cases like this without taking the time to conduct even minimal due dilligence. As far as I'm concerned, Rosie O'Donnell is a major villain in this particular situation. Had she called her lawyer and asked, she would have been told that this case has no chance. Instead, she donated to the campaign and has been promoting it. 

At this point, I've said my piece. What I haven't done (yet) is provide an explanation of why the case is hopeless. If you're good with taking me at my word on that, you can stop reading here. For everyone else, here's a short rundown on some of the more glaring legal problems that utterly doom the case, as well as an explanation of why serious court watchers already know what will happen to this case at the Supreme Court's conference on Friday.

The first step in bringing a case to a court is to file a case before a trial court - in the federal system, that's the US District Court. The Revote2017 people skipped this step and went right to the Circuit Court of Appeal with their demand that the court stop the inauguration. That's a fatal omission.

What these litigants did was file an appeal of nothing - not only was there was no lower court decision, there was no lower court case. The legal process simply doesn't work that way. Appeals courts don't issue sweeping mandates to public officials in the absence of a lower court case. And the Supreme Court doesn't overturn appeals courts that reject cases that have skipped the entire first critical step in a legal case.

Nor do courts make decisions like that without some form of formal factual record. Right now, the petition is demanding a new election because everyone knows that the Russians interfered. But the courts don't operate based on what everyone knows; they require things to be proven. (Even at the preliminary injunction stage, you typically have to provide more than just a naked assertion.) No court has formally determined that the Russians interfered, the extent of the interference, or that the interference was clearly illegal. Without findings on any of those things in the record, the Supreme Court will not step in. And without a trial court case there's no way to properly put those things in the record.

And all of that is before we get to the question of whether the Constitution permits the Supreme Court to invalidate a presidential election and order a new one. 

That's a sampling of a few of the legal problems. Here's the procedural clue that demonstrates that the case is dead. The docket for the case shows that the government (the defendant) waived their right to respond to the Supreme Court filing, and that the case was then distributed for conference. That's the sign of death. Had any Justice been interested in having the case heard by the Supreme Court, the court would have requested a response. That didn't happen, which means that the case is on the "dead list" and will be disposed of with a couple of lines in an order that will be issued early next week.

01 January 2017

Guess Who #1

It's a new year, and I'm going to start something I've been thinking about for years: a "guess who" puzzle. I've taken lots of pictures over the years. Lots of them have been of statutes, because statues don't screw up your shot by moving suddenly.

I'm going to post a picture of (part of) a statue. Take a guess and try to identify the featured person, and, for extra credit, where in the world the statute can be found. If nobody gets it within the first day or so, I'll start providing hints.

Here's the first one:

Good luck!