Fashion Law : Fashion Lawyer & Attorney : Fox Rothschild Law Firm : Licensing, Intellectual Property

I said it before and in response to Bloomberg Law's interview of Professor Susan Scafidi [Video] I will say it AGAIN:

IDPPPA will not prevent improper litigation.  Period.

Any argument that the "Heighten Pleading Standard" will prevent improper suits i.e. suits based on a designer's belief that their design is unique or original, is just nonsense, or a red herring as we lawyers call it.  Ask any litigator, not just a fashion litigator like me, and I promise you they will tell you the same thing.

I am seriously disturbed by the Bloomberg Law interview and you should be too.  Why?

• Professor Scafidi's comments - did she really say "elements" of Diane Von Furstenberg's wrap dress would get protection under IDPPPA or the Destruction of the Affordable  Fashion Bill?;
• It was 15 minutes and only presented one side;
• IDPPPA will be very costly to fashion brands because litigation costs will have to be factored into the price of clothing, increasing the price;
• It will cause less choice in the market place.  All designers need to do is "tweak" a garment compared to the original, says Scafidi.  What does that mean?
• It will flood the courts with litigation - Americans, unlike the rest of the world are KNOWN to be litigious; and
• By the way Professor Scafidi laughed at the suggestion of addition of loser pays langauge into the bill.

The only good thing about the interview? Professor Scafidi looked great!  Loved her necklace.

Repeating all the reasons why the Destruction of Affordable Fashion Bill is a really.bad.idea would take too long, but you can read more at the following related posts:

BREAKING NEWS: New Design Piracy Bill Introduced into Senate

Why IDPPPA is going to KO the Business of Fashion

IDPPPA: How to SLAPP the Sting Out of Frivolous Litigation

F21 Defeats Express: an IDPPPA Preview?

IDPPPA will not prevent frivolous litigation

The "Destruction of Affordable Fashion Bill" or IDPPPA gets one step closer to becoming Fashion Law

Senator Feinstein Puts the Breaks on The "Destruction of Affordable Fashion Bill"

Destruction of Affordable Fashion Bill Gets A Hearing Date

More Propaganda from Professor Scafidi on the Destruction of Affordable Fashion Bill on Bloomberg Law 

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My esteemed Fashion Law Colleague, Susan Scafidi, and I were both featured on CBS's the Early Show commenting on U.S. District Judge Victor Marrero's denial of Christian Louboutin's request for a Preliminary Injunction to stop Yves Saint Laurent  from selling red shoes, claiming YSL's shoes infringe on Louboutin's trademarked red sole.

As seems to be our pattern, Susan and I are on opposite sides of the issue.  While not shown on the CBS [Video], Judge Marrero's decision was "Dead On Balls Accurate."

WHY? 

Stayed tuned to learn why Louboutin should be seeing red from his many blunders in this lawsuit.

photo credit: CBS's The Early Show

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Why is it that success makes others so jealous?  

Working late, a google alert brought my attention to a Businessweek story on Forever 21's historic opening on Fifth Avenue.  The story was snarky and writer's apparent disgust of the chain's success a surprising contrast to the quality articles published by Businessweek.

The most shocking quote of all came from Susan Scafidi, the director of the newly launched Fordham Fashion Law Institute:

"Their design is swathed in mystery. . .But it probably looks a bit like a crime scene, with the chalk outline of the garments they're copying."

Ouch!  From a law professor no less, one who knows the difference between copying and counterfeiting. 

Instead of being mean girls, let's take a look at the facts:

The Changs came to this country in 1981.  They opened their first store in downtown LA in 1984 and had first year sales of $700,000.  Forever 21 founds its niche -- affordable fashion that brings joy and self-esteem to people at all socio-economic levels. 

Not only does Forever 21 have an eye for style, they understand the business of fashion:  you only make money by controlling your margins, dilution and inventory.

Today, Businessweek reports that Forever 21 has 35,000 employees in 477 stores with sales of almost $3 billion.   That takes determination, long hours, and drive.

Yes, you can find Forever 21 items that are inspired by other designers, but there is nothing illegal about that and I dare you to show me one designer that hasn't been inspired by the works of another.

This story should have been written as an inspirational tale of a hard working, immigrant family with a vision.  A reminder to us all that the American Dream is possible, especially when you find your niche.

So, all you fashion entrepreneurs out there, ignore Businessweek's sour grapes and join me in congratulating Forever 21 on their success. 

2011 is a new year and a time for new possibilities.  Where is your niche?  Will you be the next American Success Story?

With faith, and hard work, you can achieve anything you set your mind to.

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Dear Susan:

As a fellow fashion lawyer, I applaud what you are doing at Fordham University with the Fashion Law Institute, despite your unfortunate "pink and lavender" comments to New York Magazine, and agree that the fashion industry desperately needs fashion lawyers who have industry insight and knowledge.

I have to say, though, that the comments published in the press, touting Fordham as the legal arm of the Council of Fashion Designers of America (CFDA), have left me disturbed and disappointed. 

Law school is suppose to be an open forum -- a safe place to share ideas, debate concepts and teach tolerance of all sides of an issue.

While I understand that the CFDA and Diane Von Furstenburg were instrumental in helping the Fashion Law Institute open, it seems that the CFDA will be forever inter-twined in its future:

• "The collaborative efforts between the Fashion Law Institute and the CFDA will prove beneficial.....

• “The CFDA is committed to nurturing this important new venture.....

• "The CFDA’s invaluable support and advice will help ensure that the Fashion Law Institute is able to provide a resource and research platform to law students, fashion houses and especially emerging designers..."

I just hope CFDA money and its political agenda of protecting high-end New York designers at the expense of small businesses, jobs and the financial well being of the rest of the country, does not color or taint the open discourse of ideas that a law school is suppose to be. 

As I know you know, Fashion is a $350 Billion dollar industry in the United States, and only a very small fraction of that out-put comes from NY.  As you launch this new, very important endeavor, please remember that as a pioneer in Fashion Law you will be watched and scrutinized. 

Please don't make this about politics and rhetoric, but instead use the platform you have been given to help the US fashion industry continue its incredible growth and dominance.

To proceed otherwise would be truly be a fashion disaster.

Sincerely,

Staci Riordan

Chair, Fashion Law Practice Group, Fox Rothschild LLP

Editor, Fashion Law Blog

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Well, we knew it was coming.  Today, Senator Charles Schumer introduced the Innovative Design Protection and Piracy Prevention Act, or Senate Bill S. 3728 (IDPPPA).

While it seems that NY academics, the Council of Fashion Designers of America (CFDA) and the American Apparel and Footwear Association (AAFA) have signed off on this bill, I cannot find any indication that the people involved in the business of fashion, or fashion litigators were consulted.

From a review of the bill, I only see some small improvements over the last version:

1. Home sewers are free to make copes of anything for personal use;
2. The increased damages that were proposed under DPPA were stricken, leaving section 1323 unchanged;
3. The Plaintiff will have to plead his or her case with particularity -- like a fraud cause of action now, for example.  This implies that the Plaintiff will have the burden of proof on those elements, but we'll have to see how the courts interpret that language; and
4. The drafters have tried to clarify what constitutes infringement.  The new standard is "substantially identical," which means "an article of apparel" (which includes clothes, handbags and eyeglass frames and hats, among other things) "which is so similar in appearance as to likely be mistaken for the protected designs, and contains only those differences in construction or designing which are merely trivial."  HUH?

Here are the confusing parts: 

First, fashion designs will automatically be protected so designers don't have to register the designs with the copyright office, saving the designer a $35 fee.  Interestingly, Counterfeit Chic is touting this point as a victory, but to me, how could one verify that a design is "new and unique" if there is no public database to search? 

Also, most federal circuits require copyright registration as a pre-requisite to filing suit.  In legal terms, this means a plaintiff does not have standing to file a claim unless they have a copyright registration.  Is this bill trying to change that federal requirement?

Second, so many designers mistakenly believe that their creation is new.  But almost all the design we see these days pull inspiration from the art of past designers.  A great example is Diane Von Furstenberg and the wrap dress.  She claims to have invented it, but fashion history students know that McCardell introduced a wrap dress in the 1940's.

Third, only an article that is "unique, distinguishable, non-trivial and non-utilitarian variation over prior designs for similar types of articles," qualify as a fashion design.  As a member of the fashion community, I shrudder to think how a judge is going to decide THAT question.

In sum this propossed legislation ignore the realities of the business of fashion including the financial ramifications of such a law and would make judges the arbitrator of fashion.

For example, I see:

• a ton of litigation as the courts sort this out.  Pleading with particularity is no game changer.  It only adds an extra round of litigation costs.  Added litigation costs will raise the price consumer pays for apparel, something definitely not needed right now because the cost of clothing will likely rise anyways due to increasing cotton and labor prices.  Do we really need the consumer to bear more cost increases when our economy finally seems to be rebounding?  OR 
• No one will be able to create a "fashion design" that qualifies under IDPPA as written, making it needless and irrelevant.

So, while I wait to see how the rest of the industry reacts, I see this as a big win for lawyers and big companies with the resources to sue. For now, I stick to my previous position:

As a practicing fashion lawyer, litigator, former COO of apparel companies and the fourth generation of my family to work in fashion, law professors and politicians with no hands-on fashion industry experience should not be allowed to "fix" something that they have no practical knowledge of. 

 photo credit: CFA

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Here's what I am reading this week:

It’s how you wear them that counts, not the label [Taipei Times] (from the archives, but still relevant)

Diesel Launches a Dance-tastic Interactive Fashion Video [All The Rage] (I LOVE the dresses)

Do You Need to be a Bitch in the Fashion Industry to Succeed? [Nicky's Rag Tales] (Personally, I use the description "pit bull with a rhinestone collar," but hey, I am just a fashion lawyer)

The Mommy Track Turns 21 [Slate]

Tiffany v. eBay 3: (Counterfeit) Silver Lining? [Counterfeit Chic]

How to Go Full Time (reminds me of that rap song that goes, "Go hard or go home." so true!  thank you @nametagscott for another great, inspiring and "Dead on Balls"accurate post!) and Are You Profitably Patient or Destructively Passive? [Hello, My Name is Blog]

Do You Even Care if Your Clothing is Eco-Friendly? [Fashionista by @lapresmidi]

Crowdsourcing Catching On With Fashion Pack [WWD]

If you think something important was missed, feel free to send stories and tips!

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In a recent blog post, law professor, lawyer, and fashion blogger Susan Scafidi discusses the recent lawsuit filed by Alexander McQueen against Steve Madden.

In her post, Susan writes:

U.S. law doesn't protect clothing designs against copying. Hence Steve Madden's apparent business strategy: copy everything from sole to shoelace, but avoid the legally secured trademark...While the complaint isn't yet available online, lawyers for Alexander McQueen are part of an emerging trendlet, namely a return to trade dress claims...From a big picture perspective, if this trickle of trade dress claims continues, will it have a significant effect on the frequent copying of creative clothing?

I think that it won't, and here's why:

A trade dress claim will only succeed if your brand is famous, has design elements that have been around for years, and the item at issue has secondary meaning. This means that an average consumer (think the two men at a bus stop in Detroit) must be able to recognize you, the fashion manufacturer, from the outward appearance of the items. Most manufacturers will be hard pressed to met this standard.

“Inspiration,” copying and piracy is what drives trends and economic studies show that it is actually good for the fashion industry.  So for now, despite the "trade dress trendlet," it is business as usual in the fashion industry, even if McQueen has faith in its ability to change.

Photo attribution: CounterfeitChic.com

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