Technology, the sharing economy and the democratisation of art

LONDON. "Technology is transforming our relationship to assets and ownership" - Rachel Botsman recently said in an interview with Jasmine Gardner of the Evening Standard (June 27, 2013). The "sharing expert" was talking largely about consumer goods and real estate (Botsman and her family haven't owned a car in 14 years, they rent baby equipment and let the family home whenever they travel) but her message of "collaborative consumption" and the "peer-to-peer economy" as the mass democratisation of "everything" may well resonate (or should resonate) with the art community. 

For starters, P2P finance, which received government endorsement earlier this year with the Treasury's launch of a consultation process to determine the appropriate regulatory framework for these platforms, is increasingly being used as an alternative to conventional bank finance to acquire art (or so my sources tell me but no link yet). At the institutional level, museum trustees and curators are being encouraged to challenge the possibly outmoded preoccupation with ownership and explore new, more imaginative and productive ways to increase mobility of, and access to, cultural objects. Norman Palmer's 2006 paper on itinerant art in the European Community expertly sets out the various forms of legal relationships warranting serious consideration as alternatives to outright ownership or long-term loans of art and the virtues of multilateral vs. bilateral arrangements in order to foster cultural exchanges. The ongoing financial crisis, the mass digitisation of art and statutory restrictions on national museums to divest (i.e., relinquish ownership of) objects in their collections (cf. "sunset period" till 2019 under Holocaust (Return of Cultural Objects) Act 2009) make it all the more necessary to treat proposals for syndicated rotating entitlements, trusts of art, reciprocal exchanges, time-sharing and collective ownership schemes as real contenders in the pursuit of more fluid and accessible museum collections and even a greater distribution of art in the private market. These novel ways of structuring transactions are not straightforward methods for realising cultural and social objectives (think of the issues around insurance; longer, more difficult multiparty negotiations; increased administrative costs etc.) but they may be viable in certain cases and in the present climate, they cannot be automatically discarded.

I leave you with a more radical cry for the democratisation of art. Setting aside the countless practical problems associated with implementing the proposal, my main objection is to the author's one- dimensional view of access to art as physical access only when true access means physical as well as  intellectual access. Museums do much more than just display art: they interpret works and give them a context thus facilitating the public's intellectual access to works of art. As Professor Palmer puts it: "mobility [of art] is not a virtue itself."

EVENT: Highlights from the IAL study forum held in London on 29th June, 2013

LONDON. Last Saturday I attended the study forum organised by The Institute of Art and Law ("IAL") as part of the "Diploma in Art Law" distance learning course I am currently enrolled in. The day-long forum was focused on the protection of cultural heritage in times of war and national panels (UK and France as the representative from the Dutch Restitution Committee was unable to attend on the day) established to consider and, where appropriate, recommend the restitution of cultural objects looted during the Nazi era of 1933 to 1945, or, in the case of the CIVS in France, pursuant to anti-Semitic laws passed by the Vichy Government. Attendees included Professor Norman Palmer QC (3 Stone Buildings, Lincoln's Inn), Jeremy Scott (Lipman Karas LLP), Kevin Chamberlain and Dr Barbara Lauriat (King's College London).

 

The presentations were, without exception, highly informative and stimulating and one of the highlights for me was Julia Cornett's talk on the evacuation of artworks by the National Gallery and the Tate Gallery (now Tate Britain) before WWII (by the time war was declared on September 1, all major works had been evacuated) and the continued safekeeping of evacuated works until the end of the hostilities in 1945. The plans were initially drawn-up as early as 1933 which, notwithstanding developments in Germany, seems surprisingly early given the government's policy of appeasement during the 30s. It is also worth noting that no legal documents of any kind were entered into by the institutions with the various "bailees" of works (largely stately homes and the Manod quarry in Wales) in respect of the "exiled masterpieces".

 

The recent developments in copyright law discussed by Dr Lauriat also warrant a special mention:

•  Full term of copyright protection for "design derived from artistic works": under section 52 of the Copyright, Designs and Patents Act 1988 (the "CDPA"), artistic works that also constituted registered/unregistered design were entitled to a reduced term of copyright protection of 25 years. The Enterprise and Regulatory Reform Act 2013 (the "ERRA") will, however, repeal this section of the CDPA such that the full term of copyright protection under the Act (i.e., life plus 70 years) will apply to many forms of industrial, mass produced design. Professor Lauriat noted how IP academics and practitioners have opposed this change to the copyright regime in the UK on the basis that there is no (economic or other) reason why the design and "knock-off" markets cannot continue to coexist.
 
• "Orphan works": a high proportion (in some cases up to 31%) of public collections are made up of "orphan works", namely works whose copyright owner either cannot be identified or located. These works pose a direct threat to the mass digitisation projects of museums, libraries and archives and the root of the problem, said Professor Lauriat, lies in the fact that since 1911 copyright is not a registerable interest in the UK (cf. Berne Convention). The European response in the form of Directive 2012/28/EU was described as narrow in its scope by permitting only certain publicly accessible bodies use of orphan works following, inter alia, a "diligent search" of such works but the UK's implementation under section 116A of the ERRA will be considerably wider as private as well as public bodies or persons may rely on this provision and the related regulations (yet to come) for the licensing of orphan works. Professor Palmer asked whether the test for "diligent search" under section 116A(3) would be objective or subjective to take into account the resources of a particular person/institution and while the Secretary of State has yet to provide regulations in this regard, Professor Lauriat was confident that the test would be objective. Finally, it is worth noting that section 116A does not affect the publication right in respect of unpublished works though under section 76 of the ERRA, the Secretary of State has the power to reduce the term of protection (currently under the CDPA's transitional provisions unpublished works are protected until 2040 so long as they remain unpublished).
 
• Originality: copyright protection in the UK is grounded in the concept of "originality" which is not defined in the CDPA but rather developed (albeit inconsistently) in the jurisprudence. The test that has traditionally been deciphered from the relevant case law is whether a work "originates" with an author/creator meaning whether its creation is the result of "the skill, labour, judgment and effort" employed by such author/creator. The 2009 CJEU decision in the Infopaq case (and in 2012 the Football Dataco case) appeared to introduce a different, European test for originality though the court in NLA v. Meltwater stated that the test applicable under English copyright law remained unchanged in practice. Nonetheless, Dr Lauriat was of the view that perhaps the Infopaq case represented a fresh opportunity to revisit the concept of originality and in particular consider if the standard is met in photographs of three dimensional works such that copyright protection vests in these photographs (museums and galleries have long argued - and exploited - the copyrighted nature of these photographs; cf. The Bridgeman Art Library Ltd. v. Corel Corporation in which the district court reconsidered the Graves' case and held that no copyright vested in the photographs though note the higher standard of originality in the US vis-a-vis the UK).

Jancou dismissal upheld by First Department (UPDATED)

NEW YORK. Donn Zaretsky of The Art Law Blog has the scoop on how the First Department has affirmed the dismissal of dealer Marc Jancou's breach of contract claim against Sotheby's (though it isn't entirely clear from the blog post whether the reference is to this claim or Jancou's tortious interference claim against Cady Noland as both dismissals have been appealed). For background see here.

UPDATE: Donn Zaretsky has kindly clarified that he was indeed referring to the Sotheby's claim, not Jancou's claim against Noland.

Cariou expected to appeal to Supreme Court and bid the Court to offer clear guidance on what qualifies as "transformative" for purposes of "fair use"

WASHINGTON D.C./NEW YORK. The photographer Patrick Cariou is expected to file an appeal with the Supreme Court following the Second Circuit Court of Appeals' refusal earlier this month to rehear (en banc) his copyright infringement claim against Richard Prince. For background on the litigation see here, here and here.

 

The Supreme Court is of course the highest federal appellate court in the United States and its appellate jurisdiction is largely discretionary. Statistically, the odds are very much against Cariou but as his lawyer Dan Brooks says, if the Court agrees with the photographer that the law on the "fair use" exception to copyright infringement (in particular regarding what qualifies as a "transformative" work) needs to be settled or it thinks "there is a conflict between the circuits, they may agree to hear the case." 

LINKS

• SPAIN/GERMANY. "The Spanish government will lose out collecting VAT from Spanish galleries becausesales will inevitably go to foreign galleries with considerably lowerVAT." Authorities say they will consider proposals to reduce VAT on cultural goods and services, which crucially include sales of works of art, from 21% ("the highest rate on the continent") to 13%.
  
  Meanwhile, German galleries and dealers have managed to thwart, at least for now, the European Commission's attempts to get Germany to increase the rate of VAT on sales of art from 12% to 19%.
 
• LONDON. "To say we can’t afford to have the arts as part of our lives is an admission of defeat as a nation and society" - Sir Nicholas Serota on how further reductions of public funding of arts organisations will put them at risk of closure. See what the anticipated spending cuts finally came in at here.
 
• USA. The Dan Flavin Estate's change of heart regarding posthumous productions of the conceptual artist's light sculptures raises interesting questions regarding the legality of doing so given the uncertainty of Flavin's wishes in this regard as well as the impact the decision may have on the market value of works created by Flavin in his lifetime.
 
• USA. Donn Zaretsky on how the Michigan attorney general is not the first AG  in recent times to confuse the normative and legal aspects of deaccessioning.

UPDATE: Test case needed to establish standard applicable to "alterations" of artistic works under the CDPA

LONDON. In my last post I discussed how a false attribution claim under section 84(6) of the CDPA might be used by an artist in the UK to effectively disown an artwork in much the same way as Cady Noland recently did by exercising her moral rights under VARA.

 

One of the issues raised by plaintiff's counsel in the Jancou-Noland dispute was whether it is appropriate for federal legislation to give artists discretion to determine what constitutes a "distortion, mutilation, or other modification" of their work given the precarious situation in which art market participants are placed as a result. Having made the link between the right of attribution relied on by Noland and section 84(6) of the CDPA, it seemed pertinent to go on to discuss the standard a court would apply to determine whether an artistic work has been "altered" for purposes of a false attribution claim under subsection six. My personal view was that the standard would be objective (see here) but further research was required given the CDPA's vagueness in this regard. I have now conducted such research as well as consulted with the Institute of Art and Law and it appears that, absent an amendment to the CDPA, a test case is needed to ascertain the standard applicable (the repercussions for consignments/ownership of art being far greater of course were the standard to be subjective). The CDPA in its protection of moral rights needs to strike a balance between authorship rights of creators of artistic works and personal property rights and in my opinion, an objective standard would help to achieve such balance as there are no other safeguards in this specific part of the act to prevent potential abuse (unlike in section 80 where you have the (objective) "reputational harm" safeguard).

 

The act of disowning art might seem like a strictly US phenomenon (Richard Prince is another artist known to have repudiated his earlier work) but it's worth bearing in mind that moral rights were only recently introduced in the UK and artists may pursue these personal and non-transferable rights far more vigorously in the not-so-distant future. 

Are artists abusing the right to be identified as the author of an artwork?

NEW YORK. I know I said the focus of the blog would be primarily English law but I felt compelled to cover this story from the US as I have moral rights on my mind after completing the module on artists' rights as part of my Diploma in Art Law with the Institute of Art and Law.

In 2012 the dealer Marc Jancou brought two related lawsuits: the first against artist Cady Noland for tortious interference with the consignment agreement between Jancou and Sotheby's for the sale of Cowboys Milking (1990) by the artist and the second against Sotheby's for breach of the same contract. The underlying (and undisputed) facts of both claims are that in 2011 Noland disclaimed the work owned by Jancou on the basis that it was damaged ("bent beyond repair") and Sotheby's consequently withdrew the lot from auction since the work could no longer be attributed to the artist. Noland's disavowal of Cowboys Milking constituted an assertion of her moral rights under the Visual Artists Rights Act, 17 U.S.C. §106A ("VARA") - more on that later.

 

The application of the law, which resulted first in the dismissal of the Sotheby's claim and more recently the claim against Noland, is straightforward. The contractual claim against Sotheby's was dismissed on a motion by the defendant for summary judgment because the consignment agreement by its terms gave the auction house the right to withdraw the work from sale if, in its sole discretion, its attribution was uncertain. When Noland disowned the work just days before it was scheduled to be sold Sotheby's was well within its contractual rights to pull it from auction as it effectively had no attribution. It was then only a matter of time before the tortious claim against Noland was dismissed since, inter alia, under the common law of torts there can be no interference with a contract without a breach of that contract. The implications for consignment agreements generally is evident: intermediaries will want contractual withdrawal rights to protect themselves, amongst other things, against artists' assertion of their moral rights especially given that such rights remain with artists regardless of who owns the artwork itself and/or the copyright. Similarly, consignors of art will have to consider claims other than tortious interference with a contract when bringing suit against an artist on similar facts (though in any event they should negotiate any withdrawal rights a consignee has to make them as narrow as possible). Note too that a consignor with major bargaining power could even get the artist to expressly waive his moral rights in a signed writing.

But enough of the routine application of the law - what drew me to this case was a comment by Jancou's lawyer questioning an artist's discretion to determine what constitutes a "distortion, mutilation, or other modification" of an artwork and thus to some extent control it potentially long after ownership has passed to a third party such as a gallery or a collector (see §106A(d) of VARA on the duration of the rights of attribution and integrity). According to plaintiff's counsel, federal legislation is "putting the fox in charge of the hen house" when it comes to enforcing an artist's right of integrity. It seems to me that the obvious response to this statement is to point out how the artist in question is surely in a far better position than the court to assess whether one or more artworks the subject of a claim has, or have been, distorted, mutilated or otherwise modified. Furthermore, there is a clear safeguard in the legislation to help prevent abuse of this statutory right of attribution: the artist must prove that the distortion, mutilation or other modification is "prejudicial to his or her honor or reputation" (emphasis added). This is an objective test and it is for the artist to present sufficient evidence to the court that reputational harm results from the treatment of the relevant artwork. I am not familiar with the jurisprudence in this area but I suspect that the burden of proof is not easily satisfied. I would add too that in this context, the interests of artists and intermediaries buying/selling their work should, for the most part, be aligned - if artists continuously and disingenuously abused their moral rights (at the federal level in the US these are limited to the rights of attribution and the right of integrity) they would likely kill over time any secondary market in their work or prevent one from developing which presumably they would not want to do.

Turning to the UK now, under The Copyrights, Designs and Patents Act 1988 (the "CDPA") the right of attribution does not include the right to prevent the use of an author's name as author of a work that has been the subject of "derogatory treatment" (essentially the equivalent of "distortion, mutilation or other modification" of a visual work under VARA). However, the CDPA to some extent protects this kind of attribution right in the form of the right to object to false attribution of a work. An artist that qualifies for protection of moral rights under the CDPA would have to demonstrate the following to prevail in a false attribution claim:

• the work was "altered",
• the alteration occurred after the author had "parted with possession" of the work and
• the person dealing with the work in the course of a business dealt with it as being unaltered knowing or having reason to believe (emphasis added) that that was not the case.

How is this similar/different from the position under VARA? Well for starters a false attribution claim under the CDPA has an intent requirement whereas in the US a person dealing with a work need not know or believe that the work has been distorted, mutilated or modified (indeed Jancou appears to have regarded the damage to Cowboys Milking as "just wear and tear"). But if discretion lies with the artist as to what constitutes an alteration of his or her work then asserting the right of false attribution is as easy as communicating this opinion (e.g., having seen the work on display) to a dealer who cannot then sell the work as being unaltered without infringing the artist's moral right. The fact that the CDPA does not define what amounts to an alteration of a work is, I think, significant especially when one compares this with the insertion of definitions of "treatment" and "derogatory" in relation to the right to object to derogatory treatment of a work. Another difference is that false attribution need not cause reputational harm to the artist as with the third kind of attribution right under VARA. Given the absence of this safeguard against abuse, unless the test for what constitutes an alteration of a work is objective and not in the artist's sole discretion (I will research this point), then the implications of this kind of moral rights for consignment agreements may be even greater in the UK than in the US.

Art Meets Law is BACK!

It is my pleasure to announce the return of Art Meets Law! After relocating to London from NYC, a gruelling year of corporate work in private practice and four months of travelling, I am finally back at the helm of my most personal and ambitious project to date.

Still focusing on the intersection between art and law (albeit, primarily English law this time around), the aim is for the blog to develop into a useful resource not just for art lawyers but also for creators, buyers and sellers of art. It should also serve as a forum for discussion of the most pertinent legal developments affecting the global art market. To accomplish this, the law as applied to art needs to be made more accessible which will mean more informative posts that go beyond pure commentary and (gasp) a less legalistic, more informal style of writing.

Let's get started.