Copyright Protection of Designs in the EU

By Wendy Donkor

On September 6, 2019, in an important decision affecting the protection of fashion designs throughout the European Union, the Court of Justice of the European Union (CJEU) issued a preliminary ruling on the question of compliance of national law with an EU directive.  The case was C-683/17 Cofemel – Sociedade de Vestuário SA v G-Star Raw CV.  At issue was whether the court’s interpretation of Art. 2 (a) of Directive 2001/29 precludes enforcement of national (in this case, Portuguese) legislation that grants copyright protection to a design that, beyond any utilitarian function, has a distinctive aesthetic effect.  Simply, the question was whether the design could be protected under national copyright law while giving due regard to EU copyright and design law.  In this case the answer was no.

One of the core objectives of the EU is the establishment of an internal market.  Pursuant to Art. 26 (2) of the Treaty on the Functioning of the European Union (TFEU), the internal market comprises an area without internal frontiers in which the free movement of goods, people, services and capital is ensured.  One of the techniques used to provide consistent legal treatment throughout the EU is the requirement that national laws meet the requirements of EU directives.  That is, upon the issuance of an EU directive, the constituent nations have to adjust their internal laws to implement it.  According to Art. 288 TFEU, although a directive is binding upon each member state to which it is addressed as to the result to be achieved, it is left to the separate national authorities to devise the legislation to attain that result.

In Cofemel, the Court addressed the question of whether G-Star RAW, a Dutch company that designs and sells clothing, could enjoy copyright protection for its designs of jeans, sweatshirts and T-shirts.  G-Star RAW proceeded in a Portuguese court against Cofemel, a company that designs and sells clothing under the brand “Tiffosi”, accusing the defendant of copying G-Star RAW’s designs.  The CJEU held that, under Directive 2001/09, the fact that a design produces a specific aesthetic effect is not, by itself, enough to qualify it for copyright protection.

Complicating the case is that, unlike the United States, the European Union has specific rules protecting designs independently of copyright law.  The Court in Cofemel therefore had to examine the competing purposes and potential effects of the application of Directive 2001/29 (for the legal protection of copyrights and related rights) on the one hand and, on the other hand, Directive 98/71 (for the protection of designs within member states) and Regulation 6/2002 (for the legal protection of designs on the EU level) in deciding if the same design would be granted protection in both ways.

The Court noted the different purposes behind the two different forms of protection.  The purpose of the protection of designs is to provide exclusivity for a limited period of time (up to twenty-five years for registered designs; and three years for unregistered Community designs) to the owners of new, distinctive and functional designs that are liable to be mass-produced, giving the owner the chance to obtain a return on the investment without unreasonably limiting competition.  Copyright protection, however, is of far greater duration (for the life of the author plus seventy years) and, generally speaking, relates to artistic expressions of intellectual creation, known simply as “works.”

In order for a design to be classified as a “work” protectable by copyright within the meaning of Directive 2001/29, two requirements must be met.  First, the design has to be original.  In other words, it has to be “the intellectual creation of the author reflecting his personality and expressing his free and creative choices.”[1]  Second, the design must be “the expression of the author’s own intellectual creation”[2].  It “must be expressed in a manner which makes it identifiable with sufficient precision and objectivity, even though that expression is not necessarily in permanent form.”[3]

As the Court in Cofemel observed, although aesthetic considerations are a part of the creative process, the aesthetic effect of a design, by itself, cannot be considered when determining whether the design is an intellectual creation that reflects the author’s freedom of choice and personality and therefore meets the first (originality) requirement for copyright protection.  It also stated that the aesthetic effect of a design is the product of an essentially subjective sensation of beauty, which means that a design could never be identified with the precision and objectivity required to make a functional design protectable under EU design law.

In short, in this case, at least as to obtaining double protection, the beauty of fashion is self-defeating.  The clothing designs at issue will remain protected as such but will not also enjoy the benefits of copyright protection.


[1] Painer, C‑145/10, p. 94; Renckhoff, C‑161/17,p. 14

[2] Levola Hengelo, C‑310/17, p. 37

[3] Levola Hengelo, C‑310/17, p. 40


The Tricky DB

The classic sophistication of a bespoke double-breasted suit.
Photograph courtesy of Henry Poole & Co., London.

There are few items of men’s clothing more classic than a double-breasted suit.  But men’s fashion moves (slowly) in cycles, and the “DB,” as it is called in tailors’ shorthand, has not been commonly worn in this century.  Although it is currently enjoying a tempered resurgence among more fashion-forward types, it has not penetrated to the level of the average suit- or jacket-wearing man.

When done right, the DB looks great.  With its roots in the military uniform, its pronounced V-shape, and generous peak lapels, it presents a rather heroic silhouette.

But the DB suit faces two basic problems.  First, it is uncommon, and therefore draws attention – it can thus be considered flashy, which is one of the paramount attributes to be avoided in one’s dress.  Second, its jacket is architecturally a much more complicated garment than its single-breasted cousin – there is more fabric, which wraps around the torso, and more (and larger) buttons.  In this unforgiving era of relatively trim-fitting suits, where the fit must be more precise and flaws are more readily apparent, the DB is much more difficult to tailor than the SB (single-breasted) and therefore more likely to fit poorly, particularly if bought off-the-rack.

So the first thing you need to do if you want to wear a DB is to have a first-rate tailor ensure that you don’t leave until it fits perfectly.  The basic rules of successful tailoring apply – no excess fabric, no pulling, no bunching, no wrinkles.  “Clean” is the key concept, but it may be more of a challenge to get there than with a single-breasted jacket.  Be especially wary of any pulling across the front when the jacket is buttoned or any gap where the collar meets the back of your neck – these are the twin downfalls of the DB.  Fabric is always a matter of personal choice, but consider the virtues of solids, ideally navy or dark grey, in order to minimize the amount of attention the garment already inherently calls to itself.

In terms of the cut of the jacket, you will likely be the most comfortable with the classic “6×2” button stance, meaning there are six buttons across the front in two vertical rows of three, and the jacket buttons at the second button from the bottom.  The proportions of the peak lapels are critical.  They should extend roughly halfway to the shoulder.  (This, by the way, is the right proportion on a single-breasted jacket as well.)  If the lapels are too skinny or too wide, the overall balance will be thrown off and you will look either like a hipster or a clown. 

Once you have the right fit, be sure that everything else you are wearing is appropriately restrained.  The DB itself will already stand out so much that any other element of the ensemble that is less than discreet could put it completely over the top.  Best shirt choices are usually solids, thin, subtle stripes or small box checks.  The same goes for the tie – simple and restrained works best.  No more than a white linen or cotton handkerchief in the breast pocket.  Shoes should also be discreet; black or dark brown lace-ups are always appropriate. 

Given that suits these days are generally worn in a business setting, and therefore should not be distracting, in many ways, the DB is a better choice as an odd jacket (i.e., a jacket worn without matching trousers).  In a more casual setting, such as a cocktail party, the attention that the DB elicits is more likely to be of the “fun” variety than the mortifying.  And it is in such a setting that you can get more creative with your choice of fabric, buttons, etc.

Either way, wherever you wear the DB and however well-executed, get ready for comments, some flattering, some envious, some merely curious, and, yes, some simply perplexed.  If you’re not comfortable with that, stick with a single-breasted jacket and forget about what fashion magazines are telling you give a try.

Jeffrey Legault is a partner with Perricone Law and of counsel to Phillips Nizer


The Other Shoe Drops

Photo courtesy of Reinhart Julian (Unsplash Photos)

The fashion industry has debated the effect of the Supreme Court’s 2017 decision in Star Athletica, LLC v. Varsity Brands, Inc., interpreting the Copyright Act’s rules for registration of two and three dimensional designs incorporated into useful objects, on the availability of copyright protection for fashion designs and accessories. There now appears to be an emerging consensus of finding copyright protection in circumstances where it might not have been previously expected. This is hardly surprising. What is surprising is that the Court’s decision may be impacting a key question that the Court side-stepped.

While Star Athletica resolved that an otherwise copyrightable design that is a part of a useful object could be the subject of copyright so long as it could be conceived independently of the object in which it was incorporated, the Court pointedly refused to decide whether the cheerleading uniform surface patterns were copyrightable under the rules applicable to all two and three dimensional designs. Chief among those rules is the requirement of “originality”.

The breadth of the potential impact of Star Athletica is reflected in the recent decision of the Copyright Office to issue copyright registrations to adidas for the Kanye West Yeezy Boost 350 and Yeezy Boost 350 Version 2 sneakers. The application for registration as a two dimensional design and a three dimensional sculpture had originally been refused on the ground that it was a useful article. A request for reconsideration of the refusal was filed and registration was again refused on the ground that the “simple shapes arranged into common and expected pattern in very simple color schemes” did not meet the originality requirement.

But on a second request for reconsideration, the Copyright Office reversed itself, concluding that under the test of Star Athletica the two and three dimensional aspects of the designs could be “perceived” as separate from the sneaker, the useful object on which the designs appear.

It also decided that given the very low standard for copyrightability, the designs’ lines, stripes and swirls, although individually not copyrightable, had been combined in a sufficiently distinctive manner so that the designs, when viewed as a whole, merited registration. The copyrightable combinations, as described by the Copyright Office, consisted of “irregular black lines of various lengths and shapes on a grey fabric with a black semi-circle in the arch and an orange dotted stripe on an off-white heel loop” in the case of version 1 and “several grey lines in a wave pattern with a thick orange stripe on the outsole that fades toward the heel” with an inner orange layer that adds “intermittent orange coloring” in the case of version 2.

In light of the Copyright Office’s decision to register the Yeezy 350 sneaker patterns, at least in their contrasting color ways, fashion brands should now consider seeking copyright registration for their important designs containing any variation beyond the most basic, unvaried stripes.

Credit: Helene M. Freeman

Read other blog posts related to Star Athletica, LLC v. Varsity Brands, Inc. here.


Supreme Court Rules: Copyright Registration Required to File Suit

On March 4, 2019, the U.S. Supreme Court resolved an intriguing circuit split in Fourth Estate Public Benefit Corp. v. Wall-Street.com, LLC. Justice Ginsburg authored the unanimous decision, holding: “registration occurs, and a copyright claimant may commence an infringement suit, when the Copyright Office registers a copyright.” The Court rejected the argument by Fourth Estate that the registration requirement of the Copyright Act was accomplished by filing an application for registration. In its rationale, the Court leaned heavily on the language of the statute.

The Copyright Act (17 U.S.C. §411(a)) reads: “no civil action for infringement of the copyright in any United States work shall be instituted until preregistration or registration of the copyright claim has been made in accordance with this title. In any case, however, where the deposit, application, and fee required for registration have been delivered to the Copyright Office in proper form and registration has been refused, the applicant is entitled to institute a civil action for infringement if notice thereof, with a copy of the complaint, is served on the Register of Copyrights.”

Simply put, the Court stated that, “if application alone sufficed to ‘make’ registration, §411(a)’s second sentence –allowing suit upon refusal of registration –would be superfluous.”

The Court examined other provisions of the statute to interpret the meaning of §411. The Court found that the phrase “after examination” in §401 meant that “registration,” as used in the statute, follows action taken by the Register. The statute provides an exception to the registration requirement before suit through preregistration of a work that may be “vulnerable to predistribution infringement –notably a movie or musical composition,” and permits the start of an infringement action prior to registration for some live broadcasts.

How will the fashion business be affected by the ruling? This being an industry that spans the world, many creators argued in amicus briefs that requiring pre-suit registration for U.S. authors and domestic works placed them at a disadvantage since such a requirement conflicted with the Berne Convention’s de-emphasis on copyright formalities. However, the Court’s decision noted that the U.S. Congress had the opportunity to amend the copyright statute in 1988, 1993, and 2005, but declined to remove the registration formality in each instance.

The Court also pushed back against Fourth Estate’s argument that the Copyright Office’s processing time for applications was too slow, and instead pointed out that expedited processing was available, albeit for an additional $800 fee. The Court also indicated that the Copyright Office’s slow processing times could be improved should Congress address budgetary and staffing shortages.

In practice, the amount of time the Copyright Office takes to process an application is less relevant once the registration issues.

Since copyright subsists from creation in tangible form, requiring registration prior to commencing a suit for infringement does not preclude copyright owners from recovering compensatory damages from infringement that occurred prior to registration. A registration within three months of first publication will relate back to the publication date for purposes of recovery of statutory damages and attorneys’ fees; and the effective date of the registration is the date on which the copyright application is submitted and completed with the submission of the deposit copy and payment of the registration fee.

The Court’s decision is understandable as it is compelled by the statutory language. But what does this mean for creators, practitioners, and other stakeholders? Only the future will tell the long term effects in the fashion industry, but the message remains clear: if a design that is protectable by copyright is important, register it as soon as you can, preferably before it is distributed or displayed to the public, if you want to obtain the best protection and the broadest remedies in the United States.

Credit: Candace R. Arrington

See post: Supreme Court to Resolve When Copyright Suit Can Commence


White Collar Overtime Exemptions in the Fashion Industry – Part II

Salary Thresholds Under New York State Law For White Collar Overtime Exemptions

In Part One of this article, we discussed tests for allowing exemption from overtime pay for “white collar” professional, executive and administrative employees under federal and New York State law.

Effective December 31, 2018, New York State’s salary basis threshold for exempt executive and administrative (but not professional) employees increased. Employers should periodically review the job duties, functions and salaries of those currently classified as exempt and, if they wish to maintain the exemption for those below the new thresholds, must increase their salaries accordingly. Here are the new minimum salary requirements to maintain exemptions from overtime for employers in New York State:

Employers in New York City

  • Large employers (11 or more employees)
    • $1,125.00 per week ($58,500 annually) on and after 12/31/18
  • Small employers (10 or fewer employees)
    • $1,012.50 per week ($52,650 annually) on and after 12/31/18
    • $1,125.00 per week ($58,500 annually) on and after 12/31/19

Employers in Nassau, Suffolk, and Westchester Counties

  • $900.00 per week ($46,800 annually) on and after 12/31/18
  • $975.00 per week ($50,700 annually) on and after 12/31/19
  • $1,050.00 per week ($54,600 annually) on and after 12/31/20
  • $1,125.00 per week ($58,500 annually) on and after 12/31/21

Employers Outside of New York City and Nassau, Suffolk, and Westchester Counties

  • $832.00 per week ($43,264 annually) on and after 12/31/18
  • $885.00 per week ($46,020 annually) on and after 12/31/19
  • $937.50 per week ($48,750 annually) on and after 12/31/20

New York State has no minimum salary for exempt “professional” employees, although most of those employees would still be subject to the federal salary minimum for exemption ($455 per week, or $23,660 annually). The U.S. Department of Labor (“DOL”) has not raised the federal minimum salary for exemption since 2004, but on March 7, 2019, the DOL published a proposed rule that would increase the salary threshold for managerial, administrative and professional white collar exemptions to $679 per week ($35,308 per year), to take effect on January 1, 2020.

New York Fashion Industry employers should review the job duties, functions and salaries of their employees whom they currently classify as exempt from overtime pay to insure compliance with both the job duties and salary requirements. For an employee whose salary falls below pay requirements, the employer will have to decide whether to increase the salary in order to be able to continue the overtime exemption or to reclassify the currently exempt employee as non-exempt and pay them overtime for hours worked over forty in a week.

For those currently exempt employees whom the employer decides to reclassify as non-exempt, the employer should insure that all their work time is accurately recorded as of the date of change and going forward. Finally, employers should make it a point to conduct regular reviews of the primary duties of those employees it wishes to continue as exempt, since merely paying the higher salaries will not be sufficient. To qualify for the overtime exemption, employers will be required to meet both the salary test and the job duties test.

SUMMARY

Federal and state overtime law are quite fact specific. Failure to comply can lead to expensive administrative and court proceedings. The statutes of limitations – that is, the look back periods the agencies and the courts may consider in calculating overtime pay deficiencies – are two years under federal law (three years if a willful violation is found), but are six years under New York State law. And both federal and state laws provide for liquidated (double) damages and for an employer to pay the legal fees of a successful plaintiff’s lawyer. Moreover, class and collective actions abound. In short, stay current on what you need to know and consult with employment counsel as needed and whenever in doubt; or be prepared to endure exceedingly painful, protracted and costly legal consequences.

Credit: Evan J. Spelfogel

See post…White Collar Overtime Exemptions in the Fashion Industry – Part I


White Collar Overtime Exemptions in the Fashion Industry – Part I

One of the most costly mistakes a fashion business can make is to misclassify an employee as overtime exempt regardless of the employee’s duties and functions. That creates the risk of substantial liability under both federal and state law.

The Federal Fair Labor Standards Act provides for several basic overtime exemptions. These include the executive, professional and administrative exemptions and are commonly referred to as “white collar” exemptions.

To be exempt from overtime pay, an employee must be paid a fixed salary regardless of hours worked of at least $455 per week ($23,660 per year) under federal law, and more than twice that amount under New York State Labor Law, and must have duties and functions that fall within the applicable duties test.

Executive Exemption Duties Requirements

To qualify as an exempt executive (high-level manager), an employee’s primary duties must relate to managing a business or a department within a business. The employee must regularly supervise at least two full-time employees or the equivalent in part-time employees, and must have the authority to hire, fire and discipline employees, or effectively to recommend such action. Secondary tests include interviewing and training employees, and assigning and directing their work. Typically, this exemption would attach to store and departmental managers.

Administrative Exemption Duties Requirements

To qualify as an exempt administrative employee, the employee’s primary duties must consist of the performance of office or non-manual work directly related to management policies or general business operations, including customarily and regularly exercising discretion and independent judgment involving the comparison and evaluation of alternative courses of conduct and making decisions, after consideration of the various possibilities, free from immediate direction or supervision.

Duties may relate to taxes, finance, accounting, budgeting, auditing, insurance, quality control, purchasing, procurement, advertising, marketing, research, safety and health, personnel management, human resources, employee benefits, labor relations, public relations, government relations, computer network, internet and database administration, and legal and regulatory compliance.

Factors may include whether the employee formulates, affects, interprets, or implements policies or practices, whether the employee may commit the employer in matters having significant financial impact, and whether the employee has authority to waive or deviate from established company policies and procedures without prior approval.

Professional Exemption Duties Requirements

An exempt professional employee is one who falls under the definition of either a “learned professional” or a “creative professional.” Learned professionals work in professions typically requiring an advanced degree (college or higher) and a prolonged course of specialized intellectual instruction such as law, medicine, accounting, engineering, teaching, or architecture. Primary duties must be intellectual and involve the regular use of discretion and independent judgment.

Creative professionals in the fashion industry include, among others, fashion designers, fashion stylists, textile designers, fashion public relations, fashion writers, fashion illustrators, garment technologists, graphic designers and artists, creative employees who are given only a subject matter or underlying concept of what they will create, and individuals who plan and direct the creative elements of new fashion and their advertising agencies. These individuals’ primary duty is performing work that requires invention, imagination, originality or talent, as distinguishable from work dependent merely on intelligence, diligence, and accuracy. Examples of non-exempt work in fashion include fabric cutters, sizers, copyists, re-touchers of photographs, and rewriters of press releases or advertising copy, and general fashion industry employees whose work is subject to substantial control.

In Part Two, we will review in detail the New York State salary thresholds for overtime exemption.

Credit: Evan J. Spelfogel

Evan is a senior counsel in the Employment & Labor Law Practice.

See post…“White Collar Overtime Exemptions in the Fashion Industry – Part II