From Copyright and Technology:
An occasional recurring theme in this blog is how copyright law is a poor fit for the digital age because, while technology enables distribution and consumption of content to happen automatically, instantaneously, and at virtually no cost, decisions about legality under copyright law can’t be similarly automated. The best/worst example of this is fair use. Only a court can decide whether a copy is noninfringing under fair use. Even leaving aside notions of legal due process, it’s not possible to create a “fair use deciding machine.”
In general, copyright law contains hardly any concrete, machine-decidable criteria. Yet one of the precious few came to light over the past couple months regarding a type of creative work that is often overlooked in discussions of copyright law: visual artworks. Unlike most copyrighted works, works of visual art are routinely sold and then resold potentially many times, usually at higher prices each time.
A bill was introduced in Congress last week that would enable visual artists to collect royalties on their works every time they are resold. One of the sponsors of the bill is Rep. Jerrold Nadler, who represents a chunk of one of the world’s largest concentrations of visual artists: New York City.
Of course, the types of copyrighted works that we usually talk about here — books, movies, TV shows, and music — aren’t subject to resale royalties; they are covered under first sale (Section 109 of the copyright act), which says that the buyer of any of these works is free to do whatever she likes with them, with no involvement from the original seller. But visual artworks are different. According to Section 101 of the copyright law, they are either unique objects (e.g. paintings) or reproduced in limited edition (e.g. photographs). The magic number of copies that distinguishes a visual artwork from anything else? 200 or less. The copies must be signed and numbered by the creator.
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Under the proposed ART (Artist Royalties, Too) Act, five percent of the proceeds from a sale of a visual artwork would go to the artist, whether it’s the second, third, or hundredth sale of the work. The law would apply to artworks that sell for more than $5,000 at auction houses that do at least $1 million in business per year. It would require private collecting societies to collect and distribute the royalties on a regular basis, as SoundExchange does for digital music broadcasting. This proposed law would follow in the footsteps of similar laws in many countries, including the UK, EU, Australia, Brazil, India, Mexico, and several others. It would also emulate ”residual” and “rental” royalties for actors, playwrights, music composers, and others, which result from contracts with studios, theaters, orchestras, and so on.
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The Office had previously looked into resale royalties over 20 years ago. Its newer research found that, based on evidence from other countries that have resale royalties, imposing them in the US would neither result in the flight of art dealers and auction houses from the country nor impose unduly onerous burdens for administration and enforcement of royalty payments.
Yet the Copyright Office’s report doesn’t overflow with unqualified enthusiasm for statutory royalties on sales. One of the legislative alternatives it suggests is the idea of a “performance royalty” from public display of artworks. If a collector wants to buy a work at auction (anonymously through middlemen) and display it privately in her home, that’s different from a museum that charges people admission to see it. Although this would mirror performance royalties for music, it would seem to favor wealthy individuals at the expense of public exposure to art.
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As an outsider to the art world, I have no opinion. Instead it’s that 200 number that fascinates me. That number may partially explain why the Alfred Eisenstaedt photograph of the conductor Leonard Bernstein hanging in my wife’s office, signed and numbered 14 out of 250, is considerably less valuable than another Eisenstaedt available on eBay that’s signed and numbered 41 out of 50.
It begs the question of what happens when more and more visual artists use media that can be reproduced digitally without loss of quality. Would an artist be better off limiting her output to 200 copies and getting the 5% on resale, or would she be better off making as many copies as possible and selling them for whatever the market will bear? The answer is unknowable without years of real-world testing. Given the choice, some artists may opt for the former route, which seems to go against the primary objective of copyright law: to maximize the availability of creative works to the public through incentives to creators.
Link to the rest at Copyright and Technology