Authorship, authenticity, advertising

Societe Civile Succession Richard Guino v. Beseder Inc., 2007 WL 3238703 (D. Ariz.)

Let me explain – no, it is too complicated. Let me sum up: Pierre-Auguste Renoir and Richard Guino created sculptures between 1913 and 1917. At that time, Renoir took full credit. In 1974, Guino got some credit. French litigation between the Renoir and Guino heirs resulted in a settlement, but disputes over ownership and authenticity continue, as recounted here by the Telegraph (containing the interesting tidbit that the estates share an economic interest in having the authorship legally recognized as joint, since Guino’s successful suit extended the copyright by 74 years because Guino outlived Renoir by so many years; this may explain some of the friendliness between most of the heirs). Plaintiff, a French trust, now exercises Guino’s rights.

A “black sheep” Renoir, Jean-Emmanuel, authorized defendants (Rima Fine Art) to make reproductions of the sculptures and license them for a wide array of goods, targeting the “Neanderthal” art appreciator population. (Read the Telegraph story for many such gems, including the estimate that this market was worth $1 billion. I guess the GEICO Caveman needs to decorate.) The trust sued for copyright infringement, and in earlier litigation defeated defendants’ argument that the sculptures are in the public domain in the US, a decision discussed by William Patry. After a jury trial, the trust received damages from the Rima defendants of $50,000 for ten works, and $75,000 from the defendant Renoir for the same works. The jury also found in favor of defendants’ Lanham Act counterclaim. (Somewhat unhappy comment from juror here.)

The Telegraph story explains the false advertising aspects of the case, though doesn’t say that it was actually the same court and parties as the copyright case:

An Arizona court recently ordered the Société to pay $135,000 damages to Jean-Emmanuel for 'false advertising' of a 2005 exhibition of Renoir-Guino sculptures, alleged to have damaged his business as a California-based art dealer. The exhibition was held by Victor Ostrovsky, who owns a gallery in Scottsdale located opposite Rima. Although the sculptures, owned by Michel Guino, were presented as a valuable edition created for a 1974 Paris exhibition, the court heard evidence that suggests they were cast years later.

The findings came to light after an investigation by Emmanuel Javogue [an independent dealer], who was acting as the Société's agent in the US and had funded the Guinos' US lawsuit. After seeing the exhibition Javogue became perturbed. 'I had doubts about certain works. There were terracotta pieces although there is no record of terracotta sculptures made in Renoir's time. I also wondered why, instead of showing the legitimate edition the Guino estate was permitted to make with the Susse Foundry after 1982, they had sent over an earlier edition from another foundry.'

That $135,000 is because the jury awarded $90,000 in compensatory damages and $30,000 in lost profits, which the judge increased to $45,000. The court also entered an injunction requiring the trust to identify the works of art at issue “as unauthentic and/or unauthorized duplicates of the original Renoir-Guino works.” Ouch!

This seems like a good application of the Dastar remnant cause of action for false advertising about authenticity – claims that works were actually sculpted by a famous artist are clearly material, even in an age of mechanical reproduction. The trust argued it should have received judgment as a matter of law for failure to prove (1) competition between the trust and defendant Renoir and (2) actual harm.

The court found that the jury had before it sufficient evidence to support the verdict. Defendant Renoir is actively involved in the “art industry” as a dealer, buyer, seller, and broker. So is the trust, and indeed the trust was involved in planning the Ostrovsky exhibition. The trust also argued that there was no evidence it was involved in any advertisement, but the evidence about involvement with the Ostrovsky exhibition was sufficient – an ad for the exhibition identified the trust as a sponsor.

However, the court found insufficient evidence of damages. The false statements at issue were non-comparative, so some actual injury needed to be shown even though the statements were literally false. Though damage to reputation or goodwill is compensable, defendant Renoir didn’t show evidence of damage, only conclusory testimony that his reputation had been harmed; he stated that, as far as he knew, he hadn’t lost any clients as a result of the false advertising. Thus, it set aside the compensatory damage award, but not the lost profits award, putting the trust in the black by $80,000.

The trust moved for attorneys’ fees and costs of over $365,000. The court denied the motion without prejudice, among other reasons because the copyright issues are unsettled. Though the Ninth Circuit declined to take an interlocutory appeal, it will have to address the issues soon.

Meanwhile, defendants moved for sanctions. This litigation has been hard-fought (the trust also sued a local charity for including the sculptures in a charity event, though the charity was ultimately found not contributorily liable), and both sides alleged line-crossing. Basically, defense counsel, along with a translator, videographer, and stenographer, went to Paris to depose two Guinos. The night before the depositions, the trust’s French counsel sent a letter objecting on the basis of noncompliance with the Hague Convention, and no deposition took place. The court determined that it didn’t need to decide the Hague Convention issue, given (1) the eleventh-hour objection, and (2) that the trust filed suit in Arizona and then refused to make its directors or representatives available for deposition in the US, but did propose the dates for the failed Paris depositions. Thus, the court awarded 85% of defendants’ costs for the failed depositions, divided between counsel and the trust.

And then the Rima defendants moved for attorneys’ fees under the Lanham Act – not for the successful counterclaim, but for defending against the trust’s Lanham Act claim. (Oh, I didn’t mention that? There was also a failed Lanham Act claim.) The court may award fees to the prevailing party in a Lanham Act case under “exceptional circumstances,” which in the Ninth Circuit means the case was “groundless, unreasonable, vexatious, or pursued in bad faith.” The court had dismissed the Lanham Act claim at trial based on the absence of evidence presented.

The court agreed that this was an exceptional case. At trial, the trust focused on copyright damages. Its assertion of Lanham Act claims, however, caused the Rima defendants to spend unnecessary time and resources to prepare a defense. The claim should not have been brought, or should have been voluntarily dismissed. (In an interesting trademark-copyright overlap, the court apparently considered it relevant that the Rima defendants spoke to the Copyright Office before purchasing certain copies of the works at issue and believed that their acts were lawful.) For the same reasons, defendant Renoir and his mother were entitled to fees for the Lanham Act defense.

Defendant Renoir’s mother, Hernandez, was also entitled to fees as a prevailing party on the copyright claims. The trust presented no evidence against her, and the court thought that she’d been named to increase the trust’s leverage against defendant Renoir. Leaving her in until the court granted her a directed verdict was unjustified and supported a fee award under Fantasy v. Fogerty.

Finally, defendant Renoir was also awarded fees for his false advertising counterclaim. The jury specially found that the trust’s false advertising was willfully deceptive. False representations of authenticity and alterations of certain works are bad even if defendant Renoir couldn’t show he was personally injured by those acts.

Overall: the trust won a substantial victory – injunctive relief on the copyright claims is an important remedy here -- but the cost was quite high. And the final outcome is still in doubt, since the Ninth Circuit has yet to consider whether the sculptures were in fact in the public domain in the US.

There's enough here for a dissertation about the relationship between copyright, authorship, and authenticity; I'm particularly intrigued by the possibility that Guino was not an author by the standards of 1917, but had become so by the 1970s, and contrariwise that the sculptures in the Ostrovsky show might have been authentic by earlier standards, but not by present ones.