Analysis of The Design Piracy Prohibition Act (H.R. 2033/S. 1957); Introduced in the 109th Congress

The Design Piracy Prohibition Act
H.R. 2033/S. 1957
 
There is a bill pending in Congress that would extend a form of copyright protection (as discussed below) to fashion design.[1] LexisNexis wishes to engage interested members of the legal community to ascertain: (1) whether design protection for fashion is an idea which should be supported by the legal community; (2) if so, is this bill the right vehicle to accomplish that purpose; and, (3) if not, what would be the characteristics of desirable legislation. An initial review of the bill and commentary raises many questions.
 
I.                   GENERAL QUESTIONS FOR CONSIDERATION:
 
Fashion Design Protection: Is this type of protection merely a logical step in the historically ever expanding category of subject matter as a response to developments in mediums of expression?
 
 
Fashion Design Protection: Is it a symbol of elitism and exclusion or a step towards giving copyright and copyright like protection to new subject matter as another phase in the historical continuum?    Will this bill pave the way for an ever more flexible and dynamic view of protectible subject matte, in synch with the rapidly changing technologies? 
 
Fashion Design Protection: Will the difficulties in determining protectability encourage new standards or discourage the extension of protection to other non-traditional subject matter? Will this pave the way for other yet considered subject matter or will the difficulties of implementation be perceived as a cautionary against extending protection to other subject matter.
 
Fashion Design Protection: Are we supporting an industry which exploits labor or an industry which has the ability to become a key player in the human rights/anti-human trafficking movement? How can the fashion industry raise its profile on these issues, both through announcing its own best practices and by taking additional concrete steps to become a positive force for change? How can an association with this industry raise
the profile of stakeholders and supporters and draw attention to the positive actions of the companies that are active and positive global citizens and who assume leadership roles in human rights and improving work, living and educational conditions through their activities around the world?
 
 
Fashion Design Protection: Is the fashion design industry a boon to US industry and economic development or an industry reliant on outsourcing and cheap labor? What steps have the proponents of this bill taken to improve economic and job conditions in the US? Is there a connection between their success and greater outsourcing, or this an important way to keep jobs and industry in the US? Will an association with an industry which is perceived (accurately or not) as dependent on outsourcing help or harm the image of non-stakeholder companies that support this initiative? What kind of economic arguments can both the fashion industry and other creators of intellectual property make that demonstrate the economic impact of the lack of protection?
 
 
Fashion Design Protection:   How does Fashion Design Protection further the rule of law? Will a design protection bill have the desired impact against worldwide piracy and copyright infringement in the fashion industry with a positive spillover to enforcement and adherence to intellectual property rights and laws throughout the world? Or, will this lead to a further erosion of support for copyright protection, similar to the movement that has grown from opposition to term extension, which has some of the same public negatives – seen as supporting the self-serving goals of an elitist industry (Disney for term extension, Fashion Designers in this instance) and following the dictates of other countries (EU rule of shortest term in term extension, EU and Japanese design directives in this instance)? Or, can this be an opportunity to educate on those perceived negative points and bring the issues and compelling data of economic impact of intellectual property protection and losses and of US adherence (or lack thereof) to international treaties and standards to the forefront of the debate
 
Copyright Industries and the Global Marketplace: Is the lack of intellectual property protection for an important industry, fashion, in this country weakening our efforts globally to enforce protective measures in other areas? The wider and pervasive issues are that of:   how can international companies stay competitive and viable players in a global marketplace and be good global citizens while supporting economic development and job security in the United States? To what extent is that economic development and job security tied to copyright or copyright like protection of US an adapting definition of copyrightable subject matter?
 
II.                DISCUSSION OF THE ACT
 
“If we are to persuade our trading partners to adopt best practices to stop the export of illicit product to market, we must show that we are implementing these practices ourselves”. Tyson Report at 2 (discussing counterfeiting and piracy in general).[2]
 
“It is arguable that this form of artistic creation should command a protection less extensive in duration and otherwise than that accorded to more conventional art forms. But unless and until special design legislation is adopted, if the choice is full copyright protection or none at all, it may be that the former alternative is preferable to the latter. Nimmer at § 2.08 (discussing separability and providing protection to a range of items which contain both the aesthetic and functional – including dresses).[3]
 
The Design Piracy Prohibition Act (“Design Protection Act”) is before the US Congress. It was introduced in the House in 2006 as H.R.5055 and has been reintroduced in April of 2007 as H.R. 2033. It has been referred to the Subcommittee on Courts, the Internet and Intellectual Property. An identical Bill, S. 1957, was introduced in the Senate on August of 2007, and it has been referred to the Committee on the Judiciary.[4]   The primary industry advocates of the Design Protection Act are the well known and highly influential fashion industry leader the Council of Fashion Designers of America (“CFDA”) and Unite Here. These two organizations self describe as: [T]he CFDA “is a not-for-profit trade association of over 300 of America’s foremost fashion and accessory designers. Founded in 1962”;[5] [U]nite Here was “formed in 1995 by the merger of two of the nation's oldest unions, the International Ladies' Garment Workers' Union (ILGWU) and the Amalgamated Clothing and Textile Workers Union (ACTWU). Represents more than 200,000 workers through joint boards and local unions in the United States and Canada.” [6]  These two highly influential and broad based organizations have joined together to fight against fashion design piracy in recognition of the serious threat which piracy poses for the US fashion and clothing industries.
 
The Design Protection Act
 
The Design Protection Act would provide protection for original items of apparel and accessory design. The motivating forces behind this bill are the increased ease of counterfeiting and piracy in the industry at the very moment that the US is developing an international reputation as a center of fashion innovation. The US is currently the only industrialized nation which does not provide some level of protection for fashion items.
 
On February 14, there was a hearing on this Bill in the House Committee on the Judiciary, Subcommittee on Courts, the Internet, and Intellectual Property (Hearing on Design Law: Are Special Provisions Needed to Protect Unique Industries?) The Bill follows the model of Section 1301 of the Copyright Act, commonly known as the Vessel Hull Design Protection Act which amended the US Copyright Act to extend protection to that subject matter, although with a different term of years than that afforded to other categories of works.[7] The Design Protection Act would be an amendment to Chapter 1301.
 
The proposed Design Piracy Act is coupled with the Vessel Hull Design Protection Act because both relate to subject matter in a grey area of copyright law. Copyright does not protect functional items of design. Functional items are protected under patent, if at all. Items which are functional only have protection in copyright if the applied art is separable from that functionality.[8] Sometimes this is an obvious distinction as that made in two landmark cases, one where figurines on a lamp were protected despite the total item having a clear functional purpose, and similarly in a case were a highly decorative belt buckle was found to be protectible on the argument that the clasping function could be separated from the design of the clasp.[9]  The proponents of the Design Protection Act make a strong distinction between that which they are trying to protect – innovative and high style (haute couture) elements of their work and general items of clothing. Following the core copyright principle that protection does not extend to basic creative elements, , the building blocks, of copyrightable subject matter, i.e., (color in a painting, harmony in a music, structure in a book this Act would not protect clothing basic parts such as sleeves and collars.
 
 
Substantive Provisions of the Act:
 
§         Term: Provides protection for a term of three (3) years for “fashion designs that are embodied in a useful article that was made public by the designer or owner more than three months before the registration of copyright application.”
o        Copyright Protection is generally for life of the author plus 70 years. Vessel Hull design protection is for 10 years. The 3 year term proposed by the Bill advocates demonstrates their interest only to benefit from a short term effect of their innovations
§         Innocent Infringers: Protects innocent infringers from prosecution
o       Counterfeiting and piracy are currently open activities supported by large to medium scale manufacturers. Since their business is based on these activities, there will be no question of knowledge. This provision protects those unaware of the circumstances. It is assumed here that as with all copyright protection, the truly independent identical and near identical creation will be immune from any sort of liability.
§         Secondary Liability: Provides for secondary infringement and secondary liability
o       This is an important consideration, given the breadth of the chain from direct copying to production and distribution.
§         Copyright Office Role: Requires a preliminary determination by the Register of Copyright for suitability of protection.
o       This determination is assumed to be similar to that already made to determine if a work is eligible to be defined as a work of Visual Art and receive the benefits of some degree of moral rights protection and the threshold determinations which the Copyright Office has to make to determine if function and aesthetic applied art are separable in currently protectible subject matter.
§         Damages: Increases damage award for design piracy over amounts currently available for other types of subject matter. (We have not yet learned the arguments for this provision).
 
Of these essential points, the role of the Copyright Office raises the most concerns and questions. Although the proponents of the Bill describe the Copyright Office role in making initial determinations as similar if not identical to the type of activity already called on, determining the aesthetic as opposed to the functional in an item of clothing is arguably much more difficult and much more subjective than in matters concerning boat hulls or lamps or other such subject matter.
 
The last publicly stated position of the Office (on Hearing for the predecessor Bill, H.R. 5055 in 2006) was that it had no current objections to fashion design protection that the proper home for the protection would be, as proposed, in the Vessel Hull Protection Act. The Office noted that it had not seen enough concrete evidence of the harm from a lack of this sort of protection. The strong economic data that the CFDA and its associated have gathered since that hearing should answer that concern. 
 
 
The Forces Behind the Act
 
Although New York City and Los Angeles have long been centers of the US garment industry, in the past 10 to 15 years there has been a metamorphosis from production and distribution to innovative design centers. Joining the traditional fashion capitols of the world – France and Italy, New York City has become know in the trade internationally and nationally as the “Design Center of the World”. Los Angeles, Texas and other parts of the United States are gaining in international prominence. But, this burgeoning industry lacks the protection afforded original designs in other developed countries of the world. As with other content, digital technology has changed the landscape and made counterfeiting and piracy easy, swift, and immediately damaging to the fashion design industry.   As soon as fashion designs are publicly introduced, they are boldly and openly copied for mass production, with the copyists often reaching the mass market before the original designers. Digital photographs and are taken and 360 degree images are captured covertly at fashion shows and openly at events where the new designs are given their first public views. On the receiving side, sophisticated software can be used to translate the design into a pattern and from there to production and worldwide distribution in just a few steps through a sophisticated system, currently totally legal activities.
 
These quickly and easily copied items then appear in the marketplace While trademark laws make it illegal to use the exact replica of the designer’s logo or brandname and the print design on fabric can be copyrighted, that is the extent of current protection available. A walk through the market places of the world, starting with Canal Street in New York City is ample evidence of how difficult even these rights are to protect.   Thus, designers find themselves with little to no protection against a perfectly replicated item of clothing, whether passed off as their work or boldly announced as the work of a copyist.
 
Economic and Social Costs of Design Piracy
 
We have gathered a great many sources of economic data, but here rely on the report of a team led by Laura Tyson: Economic Analysis of the Proposed CACP Anti-Counterfeiting and Piracy Initiative. (“Tyson Report”).[10] This report analyzes the economic impact of counterfeiting and piracy on both the total US economy and in specific major industries. The information on the fashion apparel industry includes loss of jobs in direct and related industries, sales and taxes and an educated assumption is that they are an underestimate. The report cites figures of:
  • Total production: $350 billion dollars annually
  • Lost revenues due to counterfeiting and piracy: $12 billion dollars annually this figure does not include fashion items which currently do not have legal protection.
 
According to the Tyson Report, this is a system which in many instances around the world relies on child labor and substandard conditions for workers of all ages. The latest news of tainted ingredients, tainted foods, tainted materials raise additional concerns not only for the health and safety of those handling the raw materials but for the consumers of the finished goods, as well. In addition, worldwide global counterfeiting and piracy have been linked to the funding of terrorist organizations.[11]
 
One very vocal argument against the Design Protection Act is that it is a measure solely to protect an elitist and powerful group. Arguments which are continually leveled against content industries. The simplicity and the flaws of the unschooled economic analyses of the academic leader on this issue, Professor Christopher Sprigman (see below) are in stark contrast to the Tyson report and other data gathered by the CFDA.   But, as with so much of the anti-copyright theories, it has an appealing populist image. In fact, the Design Protection Act is important protection for the small scale designer who is less able to rely on customer loyalty, or luxury name attraction, to compete with cheaper copies of their own goods. It is the small scale designer who cannot rely on trademark infringement enforcement to stop the flow and sale of their goods. Unlike the so-called “big name” designers, it is the designs alone which are pirated. Their brand names have not been established and will continue to have little economic value if their work can be copied and sold under other labels. 
 
Outsourcing and Human Rights
 
The connection between the fashion design industry and outsourcing is one that is not as easily discounted. While it is true that production is global, there is a countervailing economic argument, backed by hard statistics, that the US fashion industry creates directly and indirectly related jobs in the US and is an important factor in the US economy. As the Tyson report demonstrates, the economic damage through loss of business opportunities leads to a loss of jobs and tax revenues. While manufacturing jobs are now being shifted along with much in the global economy, the apparel industry is essential to the US economy with direct benefits for US workers.
 
While there is popular press on both sides of this issue, the Design Protection Act faces a subtler and difficult to identify concerted effort to defeat the Bill. The California Fashion Association, a putative industry association, opposes fashion design protection, but their interests and ultimate agenda are undeterminedCriticisms have been raised against the sweatshop and enforced labor conditions in manufacturing centers in the outsourced to countries. The popular press has revealed conditions and also reported on immediate action on the part of US manufacturers. We believe that this is an area where the industry can provide leadership through stricter management controls. And, where US industry not global copyists are in charge, we can expect that US standards and US public opinion will create better environments for workers around the world. In fact, the designer Diane Von Furstenberg, who is the current President of the CFDA is a leading activist in anti-human trafficking work, lending her name and support to the rescue and rehabilitation work of the Somaly Mam foundation in Cambodia; work which will includes training in sewing and other fashion assembling and manufacturing skills for women who have been victims of human trafficking[12]
 
 
Academics Weigh In
 
Criticisms of design protection come from with the usual set of academic voices, this time most notably led by Professor Christopher Sprigman of the University of VirginiaProfessor Sprigman’s argument has all of the usual unsubstantiated claims of the opponents of a strong copyright protection regime. Without taking into account the wishes of the creators of the expressive work, the designers, he deems a lack of protection as working for their own good. It speeds up the cycle of change pressing for innovation and thereby providing a continual turn over in consumption of the designs, he argues. As with other criticisms and critics of copyright protection, this and other arguments put forth by Professor Sprigman gives short shrift to the toil involved in the creative process. The claims of Professor Sprigman and others that the Design Protection Act is a Bill in the service of big name, powerful designers is as equally off the mark as his other claims.[13]
 
Another academic prominently weighing in on the subject is Professor Susan Scafidi of Southern Methodist University (currently a Visiting Professor at Fordham University Law School), she has maintained a website for years noting all type of counterfeiting and piracy in the fashion industry. She is working to support the Design Protection Act and has written on the topic of intellectual property like protection for non-traditional subject matter. As we continue to see in the ongoing battle between those who believe in a strong intellectual property protection regime and the very active and well funded anti-protection academic community, the voice of professors of copyright law can be extremely influential.[14]
 
As this important issue continues to be debated, we welcome the opinions of our colleagues and look forward to the opportunity to engage in the discussions that will ensue.
 
H.R.2033

Title: To amend title 17, United States Code, to provide protection for fashion design.
Sponsor: Rep Delahunt, William D. [MA-10] (introduced 4/25/2007)      Cosponsors (13)
Related Bills: S.1957
Latest Major Action: 5/4/2007 Referred to House subcommittee. Status: Referred to the Subcommittee on Courts, the Internet, and Intellectual Property.

Rep Bono Mack, Mary [CA-45] - 4/25/2007
Rep Coble, Howard [NC-6] - 10/15/2007
Rep Frank, Barney [MA-4] - 9/25/2007
Rep Goodlatte, Bob [VA-6] - 4/25/2007
Rep Issa, Darrell E. [CA-49] - 7/10/2007
Rep Maloney, Carolyn B. [NY-14] - 4/25/2007
Rep Miller, George [CA-7] - 9/7/2007
Rep Nadler, Jerrold [NY-8] - 9/7/2007
Rep Rangel, Charles B. [NY-15] - 9/25/2007
Rep Towns, Edolphus [NY-10] - 9/7/2007
Rep Watson, Diane E. [CA-33] - 8/3/2007
Rep Weiner, Anthony D. [NY-9] - 9/25/2007
 

 

SUMMARY AS OF:
4/25/2007--Introduced.
 
Design Piracy Prohibition Act - Extends copyright protection to fashion designs. Excludes from such protection fashion designs that are embodied in a useful article that was made public by the designer or owner more than three months before the registration of copyright application. Gives fashion designs copyright protection for three years.
 
Declares that is not infringement to make, have made, import, sell, or distribute any article embodying a design which was created without knowledge or reasonable grounds to know that protection for the design is claimed and was copied from such protected design.
 
Extends the definition of infringing article to include any article the design of which has been copied from an image of a protected design without the consent of the owner.
 
Applies the doctrines of secondary infringement and secondary liability to actions related to original designs. Makes any person who is liable under either such doctrine subject to all the remedies, including those attributable to any underlying or resulting infringement.
 
Requires the Register of Copyrights to determine whether or not the application relates to a design which on its face appears to be within the subject matter protected as original designs and, if so, register the design.
 
Increases allowable damage awards for infringement of original designs.
 
S. 1957
IN THE SENATE OF THE UNITED STATES
August 2, 2007
Mr. SCHUMER (for himself, Mrs. HUTCHISON, Mrs. FEINSTEIN, Mr. HATCH, Mr. WHITEHOUSE, Mr. GRAHAM, Mr. KOHL, Mrs. CLINTON, and Ms. SNOWE) introduced the following bill; which was read twice and referred to the Committee on the Judiciary
COSPONSORS(10), ALPHABETICAL [followed by Cosponsors withdrawn]:     (Sort: by date)

Sen Boxer, Barbara [CA] - 10/30/2007
Sen Cardin, Benjamin L. [MD] - 10/30/2007
Sen Feinstein, Dianne [CA] - 8/2/2007
Sen Graham, Lindsey [SC] - 8/2/2007
Sen Hatch, Orrin G. [UT] - 8/2/2007
Sen Kohl, Herb [WI] - 8/2/2007
Sen Snowe, Olympia J. [ME] - 8/2/2007
Sen Whitehouse, Sheldon [RI] - 8/2/2007

 
 
S. 1953
 
A BILL
To amend title 17, United States Code, to provide protection for fashion design.
Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the `Design Piracy Prohibition Act'.
SEC. 2. PROTECTION FOR FASHION DESIGN.
(a) Designs Protected- Section 1301 of title 17, United States Code, is amended--
(1) in subsection (a), by adding at the end the following:
`(3) FASHION DESIGN- A fashion design is subject to protection under this chapter.'; and
(2) in subsection (b)--
(A) in paragraph (2), by inserting `or an article of apparel,' after `plug or mold,'; and
(B) by adding at the end the following:
`(7) A `fashion design' is the appearance as a whole of an article of apparel, including its ornamentation.
`(8) The term `design' includes fashion design, except to the extent expressly limited to the design of a vessel.
`(9) The term `apparel' means--
`(A) an article of men's, women's, or children's clothing, including undergarments, outerwear, gloves, footwear, and headgear;
`(B) handbags, purses, and tote bags;
`(C) belts; and
`(D) eyeglass frames.'.
(b) Designs Not Subject to Protection- Section 1302 of title 17, United States Code, is amended in paragraph (5)--
(1) by striking `(5)' and inserting `(5)(A) in the case of a design of a vessel hull,';
(2) by striking the period and inserting `; or'; and
(3) by adding at the end the following:
`(B) in the case of a fashion design, embodied in a useful article that was made public by the designer or owner in the United States or a foreign country more than 3 months before the date of the application for registration under this chapter.'.
(c) Term of Protection- Section 1305(a) of title 17, United States Code, is amended to read as follows:
`(a) In General- Subject to subsection (b), the protection provided under this chapter--
`(1) for a design of a vessel hull shall continue for a term of 10 years beginning on the date of the commencement of protection under section 1304; and
`(2) for a fashion design shall continue for a term of 3 years beginning on the date of the commencement of protection under section 1304.'.
(d) Infringement- Section 1309 of title 17, United States Code, is amended--
(1) in subsection (c), by striking `that a design was protected' and inserting `or reasonable grounds to know that protection for the design is claimed';
(2) in subsection (e)--
(A) in the first sentence, by inserting `or from an image thereof,' after `copied from a design protected under this chapter,';
(B) in the third sentence, by striking `A design' and inserting `In the case of a design of a vessel hull, a design'; and
(C) by adding after the third sentence the following: `In the case of a fashion design, a design shall not be deemed to have been copied from a protected design if it is original and not closely and substantially similar in overall visual appearance to a protected design.'; and
(3) by adding at the end the following:
`(h) Secondary Liability- The doctrines of secondary infringement and secondary liability that are applied in actions under chapter 5 of this title apply to the same extent to actions under this chapter. Any person who is liable under either such doctrine under this chapter is subject to all the remedies provided under this chapter, including those attributable to any underlying or resulting infringement.'.
(e) Application for Registration- Section 1310 of title 17, United States Code, is amended--
(1) in subsection (a), by striking the first sentence and inserting the following:
`(1) VESSEL HULL DESIGN- In the case of a design of a vessel hull, protection under this chapter shall be lost if application for registration of the design is not made within 2 years after the date on which the design is first made public.
`(2) FASHION DESIGN- In the case of a fashion design, protection under this chapter shall be lost if application for registration of the design is not made within 3 months after the date on which the design is first made public.'; and
(2) in subsection (b), by striking `for sale' and inserting `for individual or public sale'.
(f) Examination of Application and Issue or Refusal of Registration- Section 1313(a) of title 17, United States Code, is amended by striking `subject to protection under this chapter' and inserting `within the subject matter protected under this chapter'.
(g) Recovery for Infringement- Section 1323(a) of title 17, United States Code, is amended by striking `$50,000 or $1 per copy' and inserting `$250,000 or $5 per copy'.
(h) Other Rights Not Affected- Section 1330 of title 17, United States Code, is amended--
(1) in paragraph (1), by striking `or' after the semicolon;
(2) in paragraph (2), by striking the period and inserting `; or'; and
(3) by adding at the end the following:
`(3) any rights that may exist under provisions of this title other than this chapter.'.
End


[1] Design Piracy Prohibition Act H.R. 2033 (Delahunt, D. MA – 13 Co-sponsors)
S. 1957 (Schumer, D. NY – 10 Co-sponsors). See Attachment for Congressional Summaries.
[2] Economic Analysis of the Proposed CACP Anti-Counterfeiting and Piracy Initiative, prepared for the Coalition Against Counterfeiting and Piracy (CACP), LECG Laura Tyson, et.al. (November, 2007) (“Tyson Report”).
[3] Nimmer on Copyright 2 The Subject Matter of Copyright, 1-2 Nimmer on Copyright § 2.08
(Matthew Bender & Company, 2007).
 
[4] Supra note 1.
[5]http://www.cfda.com/index.php?option=com_cfda_content&task=about_the_cfda_display  . (Last accessed, May 12, 2008. On file with Report authors.)
 
[6]http://www.immigrantworkersfreedomride.org/presscenter/faq.php. (Last accessed, May 12, 2008. On file with Report authors.)
[7] 17 U.S.C. § 1301. “In General – The designer or other owner of an original design of a useful article which makes the article attractive or distinctivein appearance to the purchasing public may sercure the protection provided by this chapter upon complying with and subject to this chapter.” Id. at (a) (1). Presently this Section extends only to the designs for Vessel Hulls.
[8] Id at §101 et. seq. (2006).
[9] Mazer v. Stein, 347 U.S. 201, 74 S. Ct. 460, 1954, U.S. LEXIS 2276 (1954); Kieselstein-Cord v. Accessories by Pearl, Inc., 632 F. 2d 989 (2nd. Cir. 1980), U.S. App. LEXIS 13920 (1980).
[10] Tyson Report supra note 3.
[11] Id.
[12]http://www.somaly.org/foundation Last accessed, May 12, 2008.
[13] Karl Raustalia & Christopher Sprigman, The Piracy Paradox: Innovative and Intellectual Property in Fashion Design, 92 VA. L. REV. 1687 (2006).
[14]http://www.counterfeitchic.com Last accessed, May 12, 2008.