Art Case Update - May 2021
Photo: The original Lynn Goldsmith photograph and Andy Warhol's Prince portrait of the musician. Source: Exhibit taken from the Complaint.
Guest Work Agency is your go-to source on art-related legal cases and law reform in Australia, as well as select cases internationally.
In this story, our Director and Founder, Alana Kushnir and Paralegal Associate, Mia Schaumann, report on the judgment of the Federal Court of Australia in a trade mark and copyright case which considered the replica of the iconic Fearless Girl statue, a County Court of Victoria finding of misleading or deceptive conduct in relation to inauthentic artworks, a US Court of Appeals finding of copyright infringement against the Andy Warhol Foundation plus more.
Australia
Federal Court rules in favour of Australian law firm, Maurice Blackburn Lawyers, in Fearless Girl replica dispute
On the 25th of February 2021 Federal Court Justice Jonathan Beach dismissed a lawsuit filed by State Street Global Advisors Trust Company, the original commissioners of New York-based artist Kristen Visbal’s iconic Fearless Girl statute, which concerned the commissioning of a replica by Australian law firm Maurice Blackburn Lawyers (MBL). The outcome of this case is a cautionary reminder of the onus placed on businesses to understand the scope of their rights when commissioning works of art.
The original bronze statue of the life-size girl, standing with her hands placed defiantly on her hips, was commissioned by State Street Global Advisors (SSGA) in 2016. The commissioned work was unveiled on International Women’s Day in March 2017 and is now permanently located in front of the New York Stock Exchange. The original statute formed part of a marketing strategy by SSGA to promote gender diversity in senior leadership positions.
The commissioning agreement between SSGA and Visbal granted the company the exclusive right to use the Fearless Girl statue in association with ‘gender diversity issues in corporate governance, in the financial services sector’ in addition to the ‘product and services’ it offers. As part of the preapproved uses under this agreement, the artist reserves the copyright including the right to ‘create, display, and distribute’ replicas of the statue.
In 2019 MBL along with campaign partners HESTA and Cbus commissioned Visbal to create a replica of Fearless Girl, which was installed in Melbourne’s Federation Square to be unveiled on International Women’s Day 2019, for their Australian campaign addressing workplace gender equality.
Shortly after its Melbourne unveiling, SSGA’s Australian subsidiary, State Street Global Advisors Australia (SSGAA) filed a lawsuit alleging that MBL engaged in misleading or deceptive conduct contrary to sections 18 and 29(1)(a), (g) and (h) of the Australian Consumer Law (ACL) in Schedule 2 of the Competition and Consumer Act 2010 (Cth), trade mark infringement under s 120(1) of the Trade Marks Act 1995 (Cth) and copyright infringement under s 36 of the Copyright Act 1968 (Cth).
On the claim of misleading or deceptive conduct under section 18 of the ACL, Justice Beach accepted that MBL’S campaign had been made in ‘trade or commerce’, but he rejected the argument made by SSGAA that the representations had been misleading or deceptive.
In his 141-page judgement, Justice Beach found that conduct eliciting ‘mere confusion or wonderment’ would not satisfy section 18, rather ‘there [must be] a real or not remote chance or possibility of misleading or deceiving.’ The judge reiterated that what is fundamental to a finding of misleading or deceptive conduct is a ‘level of public awareness’ of both ‘the applicant’ and the ‘product or service’ they provide. Justice Beach found that there was nothing in the evidence to suggest that MBL had alleged that the replica in Federation Square was in fact the original statue commissioned by SSGA, nor did SSGA have the necessary reputation within Australia for these claims to be made out. Justice Beach rejected the tort of passing off on similar grounds.
SSGAA also made a trade mark infringement claim under section 120(1) and (2) of the Trade Marks Act 1995 (Cth) (Trade Mark Act), but this too was rejected. SSGAA argued that the phrase ‘Fearless Girl’ was registered as a worldwide trademark by SSGA in connection with gender diverse goals under their “no branding clause” which prohibits the use of the MBL logo in conjunction with the statue. Justice Beach accepted that ‘the artist was not the registered owner of the Fearless Girl trade mark within Australia’ and therefore did not have the relevant authority to authorise MBL to use the ‘Fearless Girl’ trade mark in the context of its gender diversity campaign. However, the judge dismissed the claim under section 122(1)(b)(i) of the Trade Mark Act, a defence to a finding of trade mark infringement which allows for the use of a trade mark when done as Justice Beach describes, ‘in good faith,’ or ‘act[ing] honestly and with no ulterior motive’. Justice Beach found that the words “Fearless Girl” were used by BML for the sole purpose of describing the replica itself, not to leverage the success of the narrative established by SSGA’s campaign.
SSGAA also made a copyright infringement claim under section 36(1) of the Copyright (International Protection) Regulations 1969 (Cth) (International Copyright Regulations). Although the original statue was not fabricated in Australia, the International Copyright Regulations protect ‘artistic works first published in another country’, including America, and make the doing of an act ‘without the licence of the owner of the copyright’ an infringement. The evidence presented to court by SSGAA included various posts made by MBL on Instagram and LinkedIn, a large electronic billboard at Federation Square and invitations to the launch event, all of which included a reproduction of the original sculpture. While Visbal retained ownership of the copyright in the original statue, SSGAA claimed that the ‘reproduction and communication’ of the work in MBL’s campaign was ‘done in connection with gender diversity issues in corporate governance and in the financial services sector’, and therefore impeded on the exclusive rights granted to SSGA under their commissioning agreement with Visbal. Justice Beach dismissed the copyright infringement claim, finding that the image dissemination by MBL merely refers to the ‘iconic symbol of gender equality’ and ‘does not refer to gender diverse issues in corporate governance and in the financial services sector at all’.
Justice Beach is yet to make a decision on costs and what can be done with the replica in the future. Read the full judgement here.
Offering inauthentic artworks as security for a loan found to be misleading or deceptive conduct by the County Court of Victoria
A claim of misleading or deceptive conduct made in relation to a series of artworks offered as security for a loan has been successful in the County Court of Victoria. Her Honour Judge Brimer has found in favour of Stanowitsch International Pty Ltd in its claim of misleading or deceptive conduct under s 18 of the Australian Consumer Law against Steven Drake.
In this case property developer Alexander Stanowitsch had alleged that his former friend Steven Drake had made representations that induced Stanowitsch to sign up to a $450,000 investment scheme organised by Melbourne art-dealer Peter Grant. Artworks allegedly by renowned Australian painters Howard Arkley, Charles Blackman, John Brack, Russell Drysdale, Sidney Nolan and Albert Tucker were among the nine artworks that had been offered as security for the loans. The valuation documents which formed part of the investment scheme schedules, allegedly signed by Richard Grace of Grace Fine Art, purported that the cumulative worth of the nine pieces was over $625,000. However, when Stanowitsch attempted to sell a number of the works through auction houses including Leonard Joel Specialist Auctioneers and Valuers, Menzies Fine Art Auctioneers and Sotheby’s Australia, he was refused on the grounds that the works were ‘fake’ or ‘likely fake’. These conclusions were confirmed in a report prepared for the trial by art valuer Warren Joel.
Justice Brimer explained that for a claim of misleading or deceptive conduct to be made out ‘there must be a ‘real and not remote chance or possibility’ that an ordinary and reasonable person in the position of the recipient of the information may be ‘led into error.’ This is an objective test taking into account the surrounding circumstances.
Justice Brimer drew on the trusting nature of Stanowitsch and Drake’s relationship, specifically the level of trust placed on Drake given his alleged knowledge of the art market, which was reiterated to Stanowitsch over the course of their friendship. Stanowitsch claimed that he relied on Drake’s representations ‘that the paintings were by the artists set out in the investment schedules; and that the paintings were good security and worth more than the investment amounts.’ Justice Brimer was satisfied that the investment schedule contained written representations that each artwork ‘was genuine and done by each artist.’ Her Honour found that Drake’s assertion that the ‘works were good security’ was critical to Stanowitsch’s decision to invest and by implication, provided assurances regarding the authenticity of the artworks.
Her Honour also found that as per the requirements of s 18, the alleged misleading or deceptive conduct was in ‘trade or commerce.’ This was because the artworks were provided for a purpose that was commercial by nature, as security for an investment.
Stanowitsch International Pty Ltd was awarded damages for the loss accrued as a result of the investment. The finding is a useful reminder to anyone considering purchasing a secondary market artwork, to conduct their own due diligence and have the work independently authenticated where appropriate. Read the full judgement here.
International
New York State Supreme Court orders a permanent injunction for the display of digitally altered artwork by colourist Pat Lipsky
The New York State Supreme Court has issued an injunction to stop a gallery from displaying altered versions of an artist’s work on their website. Justice Erika Edwards has ordered a permanent injunction against Spanierman Gallery, from ‘displaying, publishing, or reproducing’ altered versions of artist Pat Lipsky’s painting Bright Music II.
Widely known for her contributions to the Colour Field and Lyrical Abstraction movements, Pat Lipsky has produced a body of work using colour as a central component of her visual language. Pat Lipsky brought this action under the New York Artist's Authorship Rights Act (AARA) which provides that no person other than the artist, or those acting with the artist’s consent, can display a work of art in a modified form in a way which would damage the reputation of the artist.
Lipsky alleged that in the attempt to conceal canvas damage and sell the painting online, Spanierman Gallery used a distorted digital image which altered the once rich, vibrant colours to appear significantly duller. Lipsky argued that in doing so, Spanierman Gallery was misleading potential buyers who would mistake the modified image as her own artwork, allegedly causing ‘irreparable damage to her reputation and standing.’
Spanierman failed to appear in court and the permanent injunction was ordered as a default judgement. An assessment of damages has been ordered. Read full judgement here.
Copyright infringement claim successful against the Andy Warhol Foundation for Warhol’s use of a photograph of Prince
The United States Court of Appeals 2nd Circuit has recently ruled in favour of celebrity portrait photographer Lynn Goldsmith for her claim against the Andy Warhol Foundation, finding that Warhol infringed on the copyright in her 1981 photograph of pop icon Prince in his Prince Series and that the fair use exception defence was not made out by the Foundation.
By way of background, in 1984 Goldsmith licenced her photo of Prince to Vanity Fair magazine as a reference image. Unbeknownst at the time to Goldsmith, the image was used by Andy Warhol to create an illustration for Vanity Fair’s November 1984 issue.
Warhol also used Goldsmith’s image to create an additional 15 works, known as the Prince Series. Goldsmith became aware of the Prince Series after Prince’s death, when the work was republished by Vanity Fair in a commemorative issue. She notified the Andy Warhol Foundation (AWF), the successor to Warhol’s copyright in the Prince series, of the infringement. AWF sued Goldsmith for a declaratory judgment that the works were non-infringing, or made fair use of the image. Goldsmith countersued for infringement and the United States District Court for the Southern District found in favour of AWF.
The Court of Appeals reversed the South District ruling, relying on the interpretation of the doctrine of fair use. For the fair-use defence to be made out, the US Copyright Act of 1976 enlists four factors for the courts to consider when determining whether the use of a copyrighted work is “fair’’; the purpose and character of the use, the nature of the copyrighted work, the amount or substantiality of the portion used, and the effect of the use on the potential market for or the value of the work.
Relying heavily on the interpretation of the first factor, Justice Lynch concluded that the purpose and character of the use by Warhol was not a transformative use of Goldsmith’s image. A work is said to be transformative where ‘the secondary work itself [is] reasonably perceived as embodying an entirely distinct artistic purpose, one that conveys a "new meaning or message" entirely separate from its source material.’ Although Warhol had made modifications to the image’s ‘depth and contrast,’ ‘embellishing the flattened images with loud, unnatural colours,’ the Court found that the Prince Series works retained the essential elements of Goldsmith’s photograph. Justice Lynch held that the Goldsmith photograph remained the ‘recognizable foundation upon which the Prince Series is built’ and was not merely used as a reference.
The outcome of this case is a useful reminder of the onus placed on artists referencing copyright-protected content in their work to understand the limitations of the US Copyright Act’s fair use defence. It is also worth noting that only a week after handing down this decision, the US Court of Appeals 2nd Circuit (comprised of a different panel of judges) handed down a decision in favour of the Metropolitan Museum of Art in which the fair use defence was successful. More details below. Read full judgement here.
More international cases of interest
The United States Court of Appeals 2nd Circuit has ruled in favour of the Metropolitan Museum of Art in relation to a copyright dispute concerning their use of a 1982 photograph of Eddie Van Halen on the gallery’s online catalogue. The court found that the use of the image was sufficiently transformative, as the purpose of the use by the Met served a different purpose to the original photo. Read more here and here.
The French Appeals Court has upheld a 2018 Paris District Court decision concerning Koon’s copyright infringement of photographer Frank Davidovici’s ad campaign Fait d’hiver. Koon’s sculpture similarly titled Fait d’hiver, features a woman severed at the bust lying in the snow with a pig standing by her head. The court found that Koons’ work was indisputably similar to the photograph and ordered Koons and the Pompidou, where the work was displayed as part of a retrospective, to pay Davidovici €190,000 in addition to €600 for each day image reproductions of the sculpture are featured on their online platforms. Read more here and here.
The Cy Twombly Foundation has filed legal proceedings in a Paris court against the Louvre museum, accusing the institution of contravening the artist’s moral rights in relation to a site-specific artwork, when the Louvre renovated the Salle des Bronzes wing, home to the museum’s Etruscan art collection. The Foundation alleges that the Louvre substantially altered the context of the work when they replaced the neutral colour palette which was present at the time Twombly’s site-specific ceiling mural was produced, with copper brown walls and parquetry flooring. A reversion to the rooms original state has been requested. Read more here.
The New York Federal Court has ruled in favour of Nike for their trademark infringement claim against the art/design collective MSCHF. MSCHF customised Nike’s classic Air Max 97 sneakers designed in collaboration with rapper Lil Nas X. The Federal Court judge found that the use of the Nike swoosh on MISCHF’s ‘Satan Shoes' implied an affiliation with Nike, which was misleading. As a result of the ruling, the collective was mandated to cease the production and release of the 666 pairs of ‘Satan Shoes’. Read more here.
An NFT of a Jean-Michel Basquiat drawing titled Free Comb with Pagoda (1986) was removed from the auction platform Opensea after it was revealed that Basquiat’s estate retained the copyright to the original work. As part of the sale potential purchasers were offered ‘all related IP and copyright in perpetuity’ in addition to the opportunity to destroy the original physical copy of the work which would have made the NFT the only remaining form of the work in existence. Read more here.
France’s gallery association, The Comité Professionnel des Galeries d’Art (CPGA), is taking the French Government to court over the recent Covid-19 restrictions. The CPGA alleges that they are ‘victims of a distortion of competition’ as commercial galleries have been forced to close whilst auction houses are allowed to remain open. Read more here.
In an act of repatriation, Germany has committed to return their portion of the African artefacts known as ‘Benin Bronzes’ looted in the 1897 British military raid. Read more here.
A photo of political artist Ai Wei Wei with his middle finger up in Tiananmen Square will not be shown at the prestigious M + Museum as it was found to be in violation of China’s new national security laws which criminalise political dissent. Read more here.