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.