McKenzie v. Artists Rights Soc., Inc., 2024 WL 4803870, --- F.Supp.3d ----, 2024 WL 4803870, 22 Civ. 1619 (JHR) (S.D.N.Y. Nov. 15, 2024)
McKenzie is an art publisher that worked with the late artist Robert Indiana to create and produce two images: one called “LOVE” and the other, “HOPE.” In the 1960s, the LOVE image “gained global popularity through display on commercial products, paintings, and outdoor sculptures,” all published without notice and thus in the public domain.
LOVE sculpture, Wikimedia |
![]() |
HOPE sculpture, Wikimedia |
In 2007, Plaintiff and Indiana created the HOPE image, “similar to the LOVE image,” which began competing with the LOVE image. Indiana didn’t claim copyright in the HOPE image either.
Nonetheless, Indiana entered into two contracts with a defendant-linked entity, Morgan, in the 1990s, pursuant to which Indiana purported to convey to Morgan all “copyright, trademark, and other rights” in LOVE—in addition to “the exclusive right to reproduce, promote, and sell” the LOVE image, “produce and fabricate,” own, and sell sculptures of LOVE, and the purported right to sue for copyright infringement of the LOVE image.
McKenzie alleged that “Defendants well knew” and “certainly know now” that LOVE was not, in fact, protected by copyright. Nevertheless, “Defendants ... combined together for at least two decades to fraudulently represent that they had and still have a copyright on the LOVE image” and engaged in false licensing to the tune of millions of dollars, harming plaintiff, which is authorized to “produce and market the HOPE [i]mage” and “is in direct competition with the LOVE image.”
The RICO claims failed because they were RICO claims (and untimely).
Lanham Act: McKenzie alleged that Defendants made false representations (1) in violation of § 1125(a)(1)(A), by claiming that “Morgan and ARS ow[n]ed the copyright to the LOVE image,” and (2) in violation of § 1125(a)(1)(B), by claiming “that ARS was authorized to license said copyright.” Neither survived Dastar. Cognizable misrepresentations regarding the “origin of goods” under § 1125(a)(1)(A) “refer[ ] to the producer of the tangible goods that are offered for sale, and not to the author of any idea, concept, or communication embodied in those goods.”
Although Dastar is about authorship, it also applies to claims “for false representation of ‘affiliation’ between the author and a distributor of communicative products,” even if through “a false assertion of license.” That was the essence of McKenzie’s complaint: Defendants “deceive[ ] the general public and the relevant market” that they have a copyright to LOVE—i.e., that Indiana (or his estate) provided them with the right to license products bearing the LOVE image.
What about false advertising? “Statements about whether a defendant has the right to use or distribute a work are not considered material ....” Thus, there was no actionable misrepresentation.
Even without that, Lexmark barred the claim. To allege causation, McKenzie pled that “HOPE and LOVE, as images, have no other competition than each other.” In addition, McKenzie alleged that defendants’ use of “the false copyright assertion in relation to its many licenses of the LOVE image has greatly enhanced the revenues derived from the LOVE image, and made it appear more valuable than the HOPE image given its supposedly copyright-protected status and the extensive public visibility it has acquired.” But McKenzie failed to allege that “consumers [e.g., potential licensees] were deceived by the fraudulent [copyright]” and “also that that deception” is what “led consumers to ‘withhold trade’ ” from McKenzie.
Plus, laches barred the claim. Although “[i]n general, the defense of laches is not raised in a motion to dismiss[,] .... in certain circumstances, when the defense of laches is clear on the face of the complaint, and where it is clear that the plaintiff can prove no set of facts to avoid the insuperable bar, a court may consider the defense on a motion to dismiss.”
Although McKenzie averred that he “was unaware of the fraudulently concocted use of a false assertion of a ‘copyrighted’ LOVE image until ... February 25, 2020,” when one defendant was deposed in connection with a separate lawsuit, other allegations—including that, since 1999, defendants made “repeated” and “continuous” false assertions of copyright—undermined this position. He admitted that, “[b]efore the Hicks deposition [in 2020], [he] had seen the public advertising, observed that the large auction house and others all referred to the LOVE image as being copyrighted to Morgan and thus he believed ... that LOVE was copyrighted to Morgan.” At some point prior to Indiana’s death, he “notice[d] that virtually the entire artworld was marketing the LOVE image with the assertion that it was subject to a Morgan ‘copyright.’ ” He also alleged that, in 2007, thirteen years before the 2020 deposition, “Indiana would not authorize” him to produce a LOVE portfolio because Indiana “believed that Morgan had a copyright on the LOVE image based upon Morgan’s fraudulent representations to him that they had acquired one through his agreements with them.” Thus, he “knew” “or should have known” of any Lanham Act claim by no later than 2007. “The copyright registration status of the LOVE image was publicly available information that Plaintiff could, and ultimately did, uncover on his own.”
Thus, the delay in filing suit was inexcusable, and McKenzie didn’t rebut the defendants’ claims of prejudice based on their having continuously licensed LOVE since 1999 and the loss of evidence due to Indiana’s death.