European Design Rights: A Model for the Protection of All Designers from Piracy

Abstract

Fashion designers have attempted many times in recent years to lobby Congress for copyright protection for fashion designs, so far unsuccessfully.1 1Susan Scafidi, March on Washington 3: All-American Appeal, Counterfeit Chic (May 13, 2009), http://counterfeitchic.com/2009/05/march-on-washington-3-all-american-appeal.html. In this article I consider the fashion lobby's various proposals for the protection of fashion design under U.S. law. I argue that the operating conditions of the fashion industry—an industry that has survived many years without strong legal protection—have changed significantly in recent decades due to evolutions in the technology available to those who pirate designs, due to the types of designers, and even due to the shopping habits of customers. In my view, designers may now require some limited legal protection from direct copying of their designs. However, I also argue that both the recently introduced Senate bill, the Innovative Design Protection and Piracy Prevention Act,2 2A Bill to Amend Title 17, United States Code, to Extend Protection to Fashion Design, and for Other Purposes, S. 3728, 111th Cong. 2 (2010). and the House bill that preceded it, the Design Piracy Prohibition Act,3 3A Bill to Amend Title 17, United States Code, to Extend Protection to Fashion Design, and for Other Purposes, H.R. 2196, 111th Cong. (2009). There has been no action on this bill since it was referred to the House Committee on the Judiciary on April 30, 2009. Bill Summary and Status, 111th Congress (2009–2010) H.R. 2196 Congressional Research Service, http://thomas.loc.gov/cgi-bin/bdquery/z?d111:HR02196:@@@D&summ2=m& (last visited Oct. 15, 2010). (hereafter the Design Bills) are misnamed. The Design Bills provide protections for fashion designers that go far beyond prohibiting fakes and knockoff designs, and they will not benefit either the fashion industry or its customers. Instead, both bills overprotect high-end and well-known designers, while being underinclusive in only protecting the designers in one (admittedly important) design industry, fashion. In this article, I compare the fashion industry's legislative proposals to the law of the European Union, which provides a two-tier system of legal protection for all industrial designers. I further suggest that Congress consider incorporating aspects of the European system. In particular, Congress should consider expanding legal protection to all design, while limiting any legislation to prohibition of only the most egregious examples of piracy, in order to prevent any new design law from being used to inhibit legitimate competition among designers. The issue of whether fashion design merits extended legal protection has generated much debate among legal scholars in recent years.4 4 See generally Blackmon, Lynsey, The Devil Wears Prada: A look at the Design Piracy Prohibition Act and the Extension of Copyright Protection to the World of Fashion, 35 Pepp. L. Rev. 107 (2007); Scott Hemphill, C. & Suk, Jeannie, The Law, Culture and Economics of Fashion, 61 Stan. L. Rev. 1147 (2009); Hendrick, Lisa J., Tearing Fashion Design Protection Apart at the Seams, 65 Wash. & Lee L. Rev. 215 (2008); Miller, Matthew S., Piracy in Our Backyard: A Comparative Analysis of the Implications of Fashion Copying in the United States for the International Copyright Community, 2 J. Int'l Media & Ent. L. 133 (2008); Raustiala, Kal & Sprigman, Christopher, The Piracy Paradox: Innovation and Intellectual Property in Fashion Design, 92 Va. L. Rev. 1687 (2006). On the one hand are Professors Raustiala and Sprigman, the leading proponents of the view that additional legal protection is unnecessary for the fashion industry. They have argued that the industry shows little sign of “blight”5 5Raustiala & Sprigman, supra note 4, at 1734. and that it has thrived, at least in part, because of the lack of legal protection (or “low-IP [intellectual property] equilibrium”)6 6 Id. at 1698–99. in the fashion industry. Further, Raustiala and Sprigman have recently defended their stance that all copying, whether line by line or derivative, is beneficial to the fashion industry because of the way it speeds the fashion cycle.7 7 Raustiala, Kal & Sprigman, Christopher, The Piracy Paradox Revisited, 61 Stan. L. Rev. 1201, 1217 (2009). On the other hand, a number of scholars have rejected Raustiala and Sprigman's view, raising a variety of reasons the fashion industry now requires increased IP protection.8 8 See, e.g., Howard, Lauren, An Uningenious Paradox: Intellectual Property Protections for Fashion Designs, 32 Colum. J.L. & Arts 101 (2009); see also Hemphill & Suk, supra note 4. The most common criticisms are that Raustiala and Sprigman underestimate the new technologies of copying,9 9 See, e.g., Myers, Erika, Justice in Fashion: Cheap Chic and the IP Equilibrium in the United Kingdom and the United States, 37 AIPLA Q.J. 47, 55– 57 (2009) (detailing the changes in the dynamics of the industry, including the change in business model of high-end designers and overlap in customer base between high-end designers and cheap chic). and they misunderstand the effect of various other changes in the fashion business, especially the motivations and buying habits of consumers.10 10 See, e.g., Howard, supra note 8, at 113–17 (discussing the sociology of the modern fashion customer). The speed of global communication with factories in China, which are ready and able to execute commissions from fashion design pirates, has significantly affected the dynamics of the business. In some cases, knockoffs can reach the stores before the originals.11 11Eric Wilson, Before Models Turn Around, Knockoffs Fly, N.Y. Times, Sept. 4, 2007, at A1, A15. When this happens, the original designers are being denied the economic fruits of their creative labors, which could in turn provide a disincentive to innovate.12 12 Samuelson, Pamela, Should Economics Play a Role in Copyright Law and Policy?, 1 U. Ottawa L. & Tech. J. 3, 3 (2004) (“The principle justification for intellectual property (IP) laws in the Anglo-American tradition is economic.”). Raustiala and Sprigman's critics also argue that the democratization of the fashion business, with many different types of designers creating clothing and selling to an increasingly diverse set of consumers, has affected the ability of high-end designers to make a profit from innovative design.13 13 See Myers, supra note 9, at 57. Although almost all recent scholarly work has concentrated on fashion designers, there is another strand of scholarship concerning the proper protection of industrial design or applied art generally under American IP law. Professor Afori has suggested that industrial design, which might include fashion design, enhances market efficiency14 14 Afori, Orit Fischman, Reconceptualizing Property in Designs, 25 Cardozo Arts & Ent. L.J. 1105, 1111 (2008). and is underprotected by U.S. law.15 15 Id. at 1118. Design has certainly been the Cinderella of IP law, remaining relatively unchanged since the 1950s,16 16 Reichman, J.H., Past and Current Trends in the Evolution of Design Protection Law, 4 Fordham Intell. Prop. Media & Ent. L.J. 387, 388– 89 (1993). while trademark and copyright law have expanded relentlessly during that period.17 17 Beldiman, Dana, Protecting the Form but not the Function: Is U.S. Law Ready for a New Model, 20 Santa Clara Computer & High Tech. L.J. 529, 530 (2004). Indeed, various arguments have been made that the legal protections often used in the United States for industrial design, comprising design patents, trademarks, and copyrights, have significant shortcomings.18 18 See, e.g., Afori, supra note 14; Saidman, Perry J., The Crisis in the Law of Designs, 89 J. Pat. & Trademark Off. Soc'y 301 (2007); Setliff, Eric, Copyright and Industrial Design: An Alternative Design Alternative, 30 Colum. J.L. & Arts 49 (2006). Industrial design enjoys stronger legal protection in many other countries than it does in the United States.19 19 IP and Business: Intellectual Property in the Fashion Industry, WIPO Magazine (May 2005), http://www.wipo.int/wipo_magazine/en/2005/03/article_0009.html. In this article I use aspects of the European Union's protections for industrial design to suggest changes to U.S. law. Not only does industrial design enjoy greater protection in Europe than in the United States, but the protection in Europe appears to be more logical and conceptually coherent. Further, in Europe, industrial design plays a much greater role in government policy making than it does in the United States.20 20George Cox, Cox Review of Creativity in Business: Building on the UK's Strengths, H.M. Treasury (Dec. 2, 2005), http://www.hm-treasury.gov.uk/independent_reviews/cox_review/coxreview_index.cfm. In the context of jump-starting the economic recovery, recent commentators suggested that “[b]usiness innovation ought to be declared a public policy objective—one at least as important as boosting home ownership and agriculture.”21 21Edmund S. Phelps & Leo M. Tilman, Wanted: A First National Bank of Innovation, Harv. Bus. Rev., Jan–Feb 2010, at 1, 2. It is time for the United States to reconsider its regime of weak legal protection for works of industrial design and applied art. In Part I of this article, I describe the traditional relationship between applied art or craft and fine art, the aspects of the current fashion business—including the cult of the designer—and the challenges provided by the vibrant knockoff22 22Throughout, I shall refer to “knockoffs” to signify those designs that have been slavishly copied from an earlier design and “design borrowing” or “referencing” for the very common practice in the fashion industry of making substantially similar, or derivative but not identical, copies from an original. industry, in an effort to demonstrate why legal protection for design may now be necessary. In Part II, I briefly consider the protections U.S. law currently provides for designers and illustrate how the law fails to protect designs adequately. I also study the changes to the law proposed by the fashion industry's Design Bills, and I explain why these legislative proposals will not necessarily assist all designers or benefit consumers. In Part III, I review the European scheme of legal protection for design, focusing particularly on the scheme of design protection introduced by the 2002 E.U. design regulation.23 23 See infra Part III.A.1. Here I argue that this European law has already answered some of the questions surrounding how best to protect new design without chilling legitimate competition. Then, in Part IV, I make recommendations for amending the pending House and Senate bills, using European design law as a model. These are followed by some concluding thoughts. The following subparts explore the development of the fashion business from its origins in the craft of the dressmaker, through the debate about whether fashion is art or craft, to the modern cult of the designer. To explain the need for limited legal protection, I discuss the importance for the industry of these trends, the changes in fashion consumer behavior, and the recent rise in counterfeiting piracy. Fashion as a concept is a fairly recent phenomena. For many hundreds of years, clothing was viewed as a functional necessity rather than a means of artistic expression. In the seventeenth and eighteenth centuries, the craft of clothes making, which involved dressmakers, tailors, and eventually designers, existed exclusively in the realm of the upper class.24 24Veronica Manlow, Designing Clothes: Culture and Organization of the Fashion Industry 35 (2007). The middle and lower classes were left to wear second-hand clothing. Clothes were handed down to lower classes until eventually they could be used for nothing but rags.25 25 Id. As most people excluding the wealthy upper class wore clothes for the purpose of covering their bodies, the vast majority of clothing served a utilitarian, not an aesthetic, function. The advent of the sewing machine and the emergence of large factories, the wholesale trade, and department stores put an end to the home dressmaking of the past. During the industrialization of Europe, ready-to-wear clothing began to emerge, and by the beginning of the twentieth century, the United States had become the world leader of ready-to-wear clothing.26 26 Id. Now, in addition to the tiny market for custom-made clothing for the wealthy,27 27 Id. The haute couture industry originated in Paris where those who belong to the Syndicate de la Haute Couture still produce runway shows of their designs twice a year in January and July. Id. at 36. there exists a larger market segment of ready-to-wear fashion that is cheaper and thus more available to the masses. It is this sector in which U.S. designers are now setting the trends, after years of copying them from Europe.28 28 Design Piracy Prohibition Act: Hearing on H.R. 5055 Before the Subcomm. on Courts, the Internet, and Intellectual Property of the H. Comm. on the Judiciary, 109th Cong. 2 (2006), 2006 WL 2127240, at *7 [hereinafter Hearings on H.R. 5055] (statement of Jeffrey Banks, fashion designer). Perhaps this is why they now seek more legal protection for their work. Fashion was not historically protected by copyright law in the United States. This was due to the division in the eyes of the law between the fine arts, like literature, music, and art, which are accorded copyright protection, and crafts, which are generally not.29 29 See, e.g., Registrability of Costume Designs, Policy Decision, 56 Fed. Reg. 56,530–31 (Nov. 5, 1991). Until the last one hundred years, the design and manufacture of clothing was seen as a craft30 30 See Hearings on H.R. 5055, supra note 28, at *5 (statement of Susan Scafidi, Visiting Professor, Fordham Law School). and, like cooking, a function of homemaking. Even if clothing designs are protectable IP, the argument goes, because clothing is more functional than artistic, and so, of necessity, cannot be particularly innovative, it falls somewhere between the traditional protections accorded by copyright and patent law. This insular view of IP protection and the rigid doctrinal distinctions between the subject matter of different legal rights avoid the real issue of whether the law should allow designers to “appropriate the benefit of their investment in research and development (R&D) and product quality.”31 31 Parchomovsky, Gideon & Siegelman, Peter, Towards an Integrated Theory of Intellectual Property, 88 Va. L. Rev. 1455, 1460 (2002). In testimony before Congress, designer Jeffrey Banks talked about advancing the status of fashion design “as a branch of American art and culture,”32 32 Hearings on H.R. 5055, supra note 28, at *1 (statement of Jeffrey Banks). in a clear attempt to align fashion with fine art, making it worthy of copyright protection. Banks also said that, because fashion designers cannot compete with piracy, “the creativity and innovation that has put American fashion in a leadership position will dry up.”33 33 Id. Although fashion is meant to be functional—it has to fit the human form and keep us warm and dry—it clearly can also be artistic and creative. Most would agree that fashion is rarely fine art because it also fulfills a utilitarian function, but that this should not necessarily preclude designers entirely from protecting their investment in truly innovative design in the same manner as other creative people, like artists and musicians. The law has traditionally treated each field of IP as providing discrete and separate protection.34 34 See Parchomovsky & Siegelman, supra note 31, at 1456. Patents protect innovation in functional design, copyrights protect artistic expression, and trademarks protect goodwill and reputation. These firm divisions between patentable and copyrightable subject matter have left creative designers of utilitarian objects like clothing without protection. By contrast, according to the E.U. system of protection for industrial design, which was promulgated by regulation in 2002,35 35Council Regulation 6/2002, 2002 O.J. (L 3) 1 (EC). registered and unregistered design rights help fill the void between the legal protections for creative and innovative works into which these designers so often fall. The following subsections highlight the many recent changes in the fashion business environment. These are the rise of named designers, new patterns of creativity and consumer behavior, and the growth of counterfeiting. As the ready-to-wear fashion industry has grown in importance, so has the role of individual named fashion designers. Designers are no longer mere dressmakers to the upper classes, but instead they are creators of style in apparel for the masses. They are the arbiters of fashion, interpreting culture and setting trends. Today, high-end designers particularly, but not exclusively, can be highly influential across the industry.36 36 See Manlow, supra note 22, at 47 (describing how French couturier Christian Dior created the famous “New Look” in 1947 as a reaction to privations of war). But see id. at 94 (describing how fashion design can also derive from what real people wear, explaining that, in the 1960s, London street fashion was one of the first styles to bubble up from the street). In our modern consumer culture, fashion designers create the clothing and accessories of our desire, and the fashion industry brings them to the marketplace. Over the last forty years the focus on status has to the increased importance of the individual named and the designer has people to seek and the of fashion 37 See id. at that designer Jeffrey Banks was in creating designer there is a of other fashion designers creating clothing that does not designer and the public for named designers as as clothing and accessories are the of the increasingly global business of fashion. clothing and accessories not so much of necessity, but for those product and See and 57 J. 1, 4 (discussing product that make up The fashion business like design, and the of to and Id. To the global and business of fashion produce and how to market new See Manlow, supra note 22, at The of the fashion design it particularly to between the and the of a fashion Fashion designers may it or See Raustiala & Sprigman, supra note 4, at rather than copying, but the of creating new styles of clothing is rarely by a from the world in or See and Designers both and are by other fashion designers. They look for on the Paris in the clothes of and on the They also See, e.g., Manlow, supra note 22, at common can be in the fashion business. Fashion like or make clear that some types of copying all the at all of the industry, and are as See Susan Scafidi, Counterfeit Chic 3, that designer that a design in was by Susan Scafidi, Counterfeit Chic 3, that designer was of a to it is to original from derivative it is also to what in fashion design is worthy of protection. Raustiala and Sprigman have that design copying in the fashion industry is & Sprigman, supra note 4, at However, they make no between copying and the of designs that are substantially but not to the that both are beneficial as they have the same effect of the fashion & Sprigman, supra note at is that copying fashion designers rather than consumers, who more clothing than they and of these to & Sprigman, supra note 4, at Raustiala and Sprigman argue that all types of are they also to that design copying is designers high-end designers. Further, they argue that the industry fairly into market with the end creating new designs that down to the they are by the upper which on to the new Id. at the This view is The advent of or knockoff designers and the democratization of fashion have the between high-end and designers. fashion fashion, and fashion designers of all from 49 See Myers, supra note 9, at It is that designers focus more often than t

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