HIGHLIGHTS:

  • From Miami's Wynwood to San Francisco's Mission District to Chicago's West Loop, graffiti/street art has become a popular way for communities to revitalize neighborhoods and property owners to reap the benefits of the corresponding rise in property values.
  • In Jonathan Cohen et. al v. G&M Realty L.P. et al., the U.S. District Court for the Eastern District of New York awarded $6.7 million to a group of graffiti artists whose works had been systematically whitewashed under cover of darkness by the owner of 5Pointz, a former factory complex in the Queens borough of New York.
  • While the 5Pointz litigation heralds the willingness of a court to protect artists' work from developers looking to take advantage of rising property values, it also provides notice to property owners that working with artists at the beginning of a project can bring the richness of street art to a neighborhood without years of divisive litigation and the threat of damages if an owner no longer wants the art in question on its walls.

In Jonathan Cohen et. al v. G&M Realty L.P. et al., the U.S. District Court for the Eastern District of New York awarded $6.7 million to a group of graffiti artists whose works had been systematically whitewashed under cover of darkness by the owner of 5Pointz, a former factory complex in the Queens borough of New York. While the Feb. 12, 2018, decision sets forth a rationale for protecting graffiti art, it also acts as a warning to property owners who permit street artists to cover their exterior walls. From Miami's Wynwood to San Francisco's Mission District to Chicago's West Loop, graffiti/street art has become a popular way for communities to revitalize neighborhoods and property owners to reap the benefits of the corresponding rise in property values. The lessons from 5Pointz should reverberate in any community where street art has become prevalent.

The Creation of 5Pointz

In the 1970s, what one commentator has called the war between spray paint and real estate was sparked when Gerald "Jerry" Wolkoff, a New York City real estate developer, paid $1 million for 5Pointz, a 200,000-square-foot former factory building in the Long Island City neighborhood of Queens. During the 1990s, Wolkoff permitted a group of graffiti artists to use 5Pointz as a canvas for their murals and graffiti, turning 5Pointz into the largest repository of graffiti art in the United States. Wolkoff, who always intended to use the property to develop luxury apartment buildings, orally agreed to let the artists use 5Pointz until he was ready to redevelop it and even designated a curator to manage the art created on the walls of 5Pointz.

5Pointz eventually grew into what the Court called the "world's largest collection of quality outdoor aerosol art" and a "culturally significant site" where tourists visited, movies and music intersected with the murals, and graffiti art was fostered. Rumors that Wolkoff was ready to redevelop 5Pointz began circulating in 2011 and were solidified when Wolkoff sought approval for the development of luxury condominiums in May 2013. The property's curator, Jonathan Cohen, sought to save 5Pointz from demolition by seeking preservation as a culturally significant site, attempting to buy the property from Wolkoff and finally – together with a group of the artists whose works adorned 5Pointz – filing for a preliminary injunction under the Visual Artists Rights Act of 1990 (VARA). In November 2013, after the injunction was denied (but importantly for the court, prior to the court issuing its formal written ruling), Wolkoff directed the whitewashing of 5Pointz in the middle of the night, destroying or covering up almost all of the artists' works.

The 5Pointz Litigation

On Feb. 12, 2018, U.S. District Court Judge Frederic Block ruled that Wolkoff had violated VARA and awarded $6.7 million to the 21 graffiti artists suing Wolkoff, determining that 45 of the ruined murals had enough "artistic stature" to merit being protected under the auspices of VARA. This case highlights the importance of a number of lessons that both property owners and artists can employ to successfully collaborate on projects like 5Pointz.

First and foremost, the 5Pointz case stands for the proposition that street art can be more than vandalism or a random act with a spray can. Street art can be culturally important art worthy of recognized stature under VARA. Under VARA, this kind of art should be protected from wanton destruction, mutilation or distortion by property owners looking to redevelop property made valuable, in some instances, by the very art they are looking to remove or demolish. While VARA provides a powerful form of protection to these artists, it is not without its boundaries.

VARA is the embodiment of artists' moral rights, but like most rights, those moral rights can be waived by the artists in question. VARA deals both with works of art that can and cannot be removed. VARA's protections do not extend to works of visual art incorporated into a building in such a way that removing the work will cause the destruction, distortion, mutilation or modification of the work if the artist consented to such installation prior to VARA's effective date or where a written instrument is signed by the owner of the building and the artist specifying that the work in question may be subject to destruction, distortion, mutilation or modification by reason of its removal. The 5Pointz court noted that while Wolkoff and the impacted artists all generally knew that the property would one day be redeveloped, they had not reduced that understanding to a writing that waived VARA's protections. Owners contemplating permitted street art on a property should heed this finding and, prior to permitting any work to be installed on their building, set forth the understanding between artists and owners as to the longevity of the work in question and whether or not artists are waiving or retaining their VARA rights.

Second, if no waiver is in place, the work of art is removable without destroying, mutilating or otherwise modifying it, and an owner wishes to remove such work, the owner should take steps to carefully follow VARA's requirements. VARA provides a framework whereby an owner can notify an artist of its intentions to remove the work in question and the artist is afforded the opportunity to remove the work. VARA also provides a procedure if the owner is unable to notify the artist or if the artist fails to respond to timely notice. Based on the court's rationale, had Wolkoff followed VARA’s procedures, Wolkoff may have avoided the imposition of liability and it may have been possible for the artists to have removed and preserved the art.

Third, owners trading on the value of the art should be aware that the street art community is no longer a group without a voice. Judge Block's opinion notes that not only was he impressed with the portfolios of the individual artists presented in evidence as the basis that the works in question were indeed art but that he also found the plaintiffs' list of witnesses compelling. The artists produced art appraisers, a former head art expert from Chubb Insurance and an art professor from New York University, each of whom testified to the value and quality of the art. They also produced conservators who testified that the works were indeed removable.

As with most things, a little planning can go a long way. While the 5Pointz litigation heralds the willingness of a court to protect artists' work from developers looking to take advantage of rising property values, it also provides notice to property owners that working with artists at the beginning of a project can bring the richness of street art to a neighborhood without years of divisive litigation and the threat of damages if an owner no longer wants the art in question on its walls. Wolkoff serves as a cautionary tale to property owners that noting intentions without reducing those intentions to a writing is not sufficient when it comes to VARA. By drafting the appropriate waivers and following the appropriate procedures ahead of time, artists and developers can continue to work together to revitalize communities, bring foot traffic and new businesses into neighborhoods, and generally contribute to the ever-growing repository of graffiti art on the streets of America's cities.

Information contained in this alert is for the general education and knowledge of our readers. It is not designed to be, and should not be used as, the sole source of information when analyzing and resolving a legal problem. Moreover, the laws of each jurisdiction are different and are constantly changing. If you have specific questions regarding a particular fact situation, we urge you to consult competent legal counsel.