In the current lame-duck session of Congress, it is not yet clear what will happen regarding a number of pending matters. Of particular interest to the fashion industry is what has been called a design piracy protection measure (see thomas.loc.gov for the text). While on its face the bill would seem to make sense, a closer look prompts serious concerns. Couched as an attempt to protect the designs of novice artisans, this bill would allow a designer to claim his or her design is original and therefore entitled to protection under the Act. The designer may then file suit against anyone claimed to have copied that design. Notice there is not one word said about obtaining copyright protection. The supporters of the legislation would have us believe copyright protection is too expensive and unnecessary. In reality, the cost is negligible AND gives notice of the originality of the design to the world.
Absent any requirement of an offer of proof of originality, this bill permits a designer to simply say I have published my design (somewhere, no matter how obscure), claim the design is "a unique, distinguishable, non-trivial and non-utilitarian variation over prior designs for similar types of articles," and seek damages. Limited design rights exist under U.K. law, but the scope of that law is narrow, plus the U.K. operates under a loser-pays system whereby, before bringing litigation, a plaintiff must have some level of assurance the case will succeed. As such, plaintiffs must be much more cautious about bringing lawsuits. The system is obviously quite different under U.S. law.
In the absence of copyright registration, a retailer or other provider of private label or other fashion merchandise becomes liable should some unknown designer claim infringement of his/her design and pursue litigation. To what extent any fashion design truly is unique is itself under debate by fashion followers and historians whose knowledge of runways and racks is far superior to that of judges and juries in whose laps such decisions would fall according to this bill.
The most serious concerns fall into two categories. First, what will the impact of such a loosely worded law have on the fashion industry? Will it cause distributors and sellers to change how they do business and thereby limit the choices available to the ultimate consumers? Many companies rely on factors for cash flow. What additional steps might factors impose before agreeing to finance a company's inventory? As the California Fashion Association stated in its recent position paper, "This legislation protects those who design the $2,500 garment, and imperils those who design the $150 garment."
The second category of concern involves the extent to which lawsuits are filed against "deep pocket" defendants whose resources become appealing targets for those in pursuit of damage awards. In a loser-pays situation, those sorts of frivolous lawsuits are not generally filed. However, since attorneys' fees are difficult to collect in the U.S., will this bill provide the plaintiffs' bar with additional grounds to seek nuisance settlements from distributors and retailers? The Retail Industry Leaders Association stated it this way: "Our members are concerned that if enacted, S. 3728 would result in increased, costly litigation that would cause uncertainty at all levels of the fashion industry and limit the ability of the vast majority of American families to enjoy fashionable apparel at affordable prices."
For more details, see CalFashion.org. The sponsors of the bill include Senators Schumer (NY), Boxer (CA), Cardin (MD), Feinstein (CA), Gillibrand (NY), Graham (SC), Hatch (UT), Hutchison (TX), Kohl (WI), Snowe (ME), and Whitehorse (RI). Let them know what you think.