Three more months of my Judith Bresler Fellowship! The time flies when you're engaging with and learning from lawyers, artists and art professionals! Through the efforts of the Judith Bresler Fellowship, the Center has provided guidance to artists with our clinical consultations, taught workshops and facilitated conversations between artists, attorneys, archivists and appraisers (just to name a few!) Additionally, our Artist Feature Series has focused on important conversations with artists such as Martha Szabo on legacy and estate planning; Steven Oscherwitz, on the intersection of science, law and art; and with Molly Dougenis on filing lawsuits and recovering stolen artwork-- every story has been eye-opening and taken us a step closer to supporting remerging and older artists.
We also have a series of in-person events related to our clinical offerings on immigration law, legacy and estate planning and artist-dealer relations at the National Arts Club, along with a TON of exciting webinars as we launch our new Artist-Dealer Relationships Clinic this summer! Who knows, may be in not so distant future the Center will host a retreat for art-service professionals...
In brief, it’s been quite a year at the Center and an exciting journey for me, so far, as the inaugural fellow. Through the Fellowship, I have gained practical experience in working with attorneys and art professionals in the community and collaborated with art institutions and foundations to make art law accessible to all. The fellowship has afforded me the opportunity to contribute to law as a lawyer, educator, and a lover of the arts.
As my own Fellowship is nearing completion, I invite recent law school graduates to apply for the Fellowship to learn more about the intersection of art and law, contribute to the field and honor Judith’s legacy. I would also like to thank all the sponsors of the Fellowship and invite you all to consider endowing and supporting the Fellowship for many more years to come!
Atreya Mathur Judith Bresler Fellow 2021-2022
On Our Calendar
NATIONAL ARTS CLUB & CENTER FOR ART LAW Immigration and Artists: The O-1 Visa April 20, 2022, 6:00 PM EST
The National Arts Club, 15 Gramercy Park South, New York, NY 10003
Join the National Arts Club and Center for Art Law as we debut a conversation with artist and NXHVN Fellow Layo Bright and immigration attorney Rebecca Lenetsky on the world of immigration. Bright and Lenetsky explore nuances behind the process behind receiving the O-1 Visa for Gifted and Talented Artists and share their experience in all things immigration and art. This is the first event in a series of three events with Center for Art Law as part of the Center’s Legal Clinics for Visual Artists. It is being offered as part of Center for Art Law’s Visual Artists’ Immigration Clinic.
This program is supported, in part, by public funds from the New York City Department of Cultural Affairs in partnership with the City Council.
CENTER FOR ART LAW Art Law Lunch Talk: Safe Space: How Artists Interact with Museums
April 26, 2022, 12:00 PM EST
As the contemporary art world evolves, many museums find themselves in a position to re-examine their role in it. From navigating conservation in a digital age to reinterpreting the use of museum space, many of these changes are entering uncharted territory. One way museums are leaning into their roots at this time is by providing a new level of support for artist-museum relationships. Join us for a conversation moderated by Irina Tarsis between Joel Ferree (Los Angeles County Museum of Art) and Sriba Kwadjovie Quintana (San Francisco Museum of Fine Arts) to hear their thoughts on the role of artists within the current and future museum world. Exploring topics from artist workshops and mentorships to monetary assistance and legal parameters, the audience will learn about current developments in the museum field so that artists, museum professionals, and visitors alike can better understand the vitality of museums and their role as a safe space.
CAEL Journal ConferenceThe Parthenon Marbles Case and the Universal Museum Myth: Policies and Politics April 28, 2022, 9:00 PM EST
The conference will bring together scholars and advocates to discuss the history of cultural property, its rightful owners, and whether the property should be returned to its original creating country. Professor David Rudenstine will present his decades-long historical research challenging the British Museum’s claim in the cultural property dispute between Greece and Great Britain over the Parthenon Sculptures taken to London in the early 1800s by the British ambassador, Lord Elgin.
CENTER FOR ART LAW CLE - Information & Compliance: Legal Issues for Galleries April 28, 2022, 12:00 PM EST
As the internet age grows around us, the world of art has also had to adapt and move into the digital plane. The purpose of this CLE program is to explore legal obligations that art businesses in general and galleries in particular have in the increasingly digital world. From enhanced privacy obligations to knowing the sources of funds and identity of clients investing in art, from clear terms and conditions to copyright compliance, members of the art market will learn and review their obligations under federal and state laws to become and remain compliant with the ever-changing and increasingly regulated digital world. Moderator: Tess Bonoli, Esq., Morrison Cohen; Speakers: Jana Farmer, Esq., Wilson Elser; Lawrence Shaw, AAAtraq; Irina Tarsis, Esq., Artists Rights Society.
MEDICI MUSEUM OF ART Art Crime in the 21st Century: Robert K. Whittman Lecture Series May 4, 2022, 7:00 PM EST
USA VS ART THIEVES: Join FBI agent, best-selling author, and art crime expert Robert Wittman to uncover the inside stories of the multi-billion dollar worldwide business of art crime where frauds, forgeries, and fakes are the largest component.Drawing on cases he worked on personally during his long and illustrious career in the FBI's National Art Crime Team, Mr. Wittman will share stories and details of famous art forgeries. We'll meet a fake Saudi Sheikh with a fake Rembrandt and find out about a forged contemporary piece by Jean Michele Basquiat. Using visuals and video, we will also dig into a fraud case that rocked PBS's Antiques Road Show years ago. Later, we will learn about legal rulings and protections for art collectors and find out how not to acquire a fake or a forgery!
Led by an expert on art fraud, award-winning author, and FBI agent, Robert K. Wittman, this interactive talk will explore the multi-billion-dollar industry of fakes and forgeries.
INSTITUTE OF ART & LAW War and the Legal Protection of Cultural Heritage May 6, 2022, 8:00 AM EST
While the human costs of this war are at the forefront of everyone's mind, it nevertheless remains important to gain a better understanding of the terrible destruction and damage also being caused to religious establishments, historical monuments and cultural institutions such as theaters and museums. This webinar is an attempt to set out the rules and practices of war in relation to the protection of cultural property against the backdrop of this tragic and ongoing conflict.
CENTER FOR ART LAW Art Law Lunch Talk: Museums and Deaccessioning May 11, 2022, 12:00 PM EST
Join the Center for Art Law as we discuss and explore the issues that museums have to consider and what they go through when they go through the deaccessioning process with Jill Deupi, Director of the Lowe Art Museum, U. of Miami, Katie Wilson-Milne, Partner at Schindler Cohen & Hochman LLP, and Irina Tarsis, Founding Director, Center for Art Law.
Students are eligible for a discount on membership. Contact us for more info!
What's New in Art Law
Attorneys for incarcerated Inigo Philbrick have asked the court for leniency ahead of the former art dealer’s planned sentencing. Seventeen friends and family members have written testimonials on Philbrick’s behalf, including a letter from contemporary art due Gilbert and George, who worked with Philbrick during his tenure as an intern at London’s White Cube Gallery in 2005. After being arrested in June 2020 for wire fraud associated with more than $86m of artworks, Philbrick was scheduled to be sentenced in New York this week, and the hearing has now been delayed until early May.
A Case for Making Marble Digital
After the Institute of Digital Archaeology was refused permission for a 3D scan of the Parthenon Sculptures, the archaeology organization has filed a freedom of information request to the British Museum, who currently owns the antiquities. The digital scans would produce replicas to be housed in the London museum, allowing the original marbles to be returned to Greece. Originating in the 5th century B.C. Athens, the works were removed by the Earl of Elgin in the 19th century. Since their removal, Greece has persistently requested their repatriation.
Meme or Mimicry?
German appropriation artist Martin Eder recently won a copyright case against U.K. artist Daniel Conway. Conway asserted that Eder’s 2018 painting “The Unknowable” was partially plagiarized — a claim that was brought to light and infamy by Instagram account diet_prada. Deemed an original by a Regional Berlin Court, Eder’s signature kitschy oil painting featuring internet imagery marks an inflection point in the way European law interprets appropriation art.
A Landmark Decision Underway
The US Supreme Court (SCOTUS) has agreed to hear Warhol v. Goldsmith by granting the Andy Warhol Foundation for Visual Arts, Inc. a writ of certiorari. A fair use copyright case, it concerns Andy Warhol’s screenprints of the singer Prince which used a photograph taken by Lynn Goldsmith. SCOTUS has taken up this case after a lower court ruled that the prints were not fair use.
A Miami Memorial
The Florida Southern District Judge has ruled in favor of the City of Miami Beach in a case concerning artwork memorializing a man, Raymond Herisse, killed by Miami Beach Police in 2011. Commissioned by the city, it was installed in 2019 for “ReFrame Miami Beach” but taken down the day after the exhibtion opened. Judge Marcia G. Cooke stated that “When the government exercises ‘the right to speak for itself,’ it can freely ‘select the views that it wants to express’” while the commissioned artist remarked that “...I slowly became outraged. I could not understand how an image that was meant to memorialize someone could be offensive.”
Yale, Yale, Yale… Look What We Have Here
United States Homeland Security confiscated over $1 million worth of antiquities from Yale University. The objects have been linked back to Subhash Kapoor, an infamous antiquities trafficker who was convicted a decade ago for his involvement in an international muggling scheme. Compliant in the delivering the stolen works, the museum has made a public statement and said that “Yale was glad to work cooperatively with the D.A.’s [District Attorney’s] Office in this important matter.”
A War by any Other Name
The Edgar Degas painting previously known as “Russian Dancers” has been renamed “Ukrainian Dancers.” A decision made by London’s National Gallery, it follows an increased public pressure to better distinguish between Russian and Ukrainian culture. This will separate it from the pastel drawings titled “Russian Dancers” that reside in the collections of the Metropolitan Museum of Art and the Museum of Fine Art Houston.
Legal Anarchy (Short-lived)
Finland has temporarily seized €42 million ($46 million) worth of art owned by Russian museums. Previously on loan in Italy, the movement was in violation of recent EU sanctions against the export of luxury goods to Russia. The confiscation of the art, which is owned by the Russian Federation, has been described as “legal anarchy” by a member of the Russia Foreign Ministry. Finland released art but the message was loud and clear.
Man with a Mission
The Greek collector Dimitris Daskalopoulos has made a newsworthy donation by gifting away a total of 350 paintings to four museums around the world. Following calculated decisions regarding where pieces of his contemporary collection should go, The Greek National Museum of Contemporary Art in Athens, Tate, the Solomon R. Guggenheim Museum, and the Museum of Contemporary Art Chicago will be the recipients. An accomplished collector, Daskalopoulos remarked that: “My collection has completed its mission. It has said what it has to say.”
The Gemäldegalerie of Berlin has announced that a painting previously thought to have been painted by a Govert Flinck, a student of Rembrandt, was actually done by Rembrandt himself. The painting, Landscape with Arched Bridge, was attributed to Rembrandt when the museum acquired it in the 1920s, but scholars in the 1980s reattributed it to Flinck.
Back Home Again
The Metropolitan Museum of Art has returned a looted Ancient Greek statue to Libya after an investigation by the Manhattan District Attorney’s Office investigation found that it had been stolen from the ancient port city of Cyrene. Stolen from a UNESCO World Heritage site, the Necropolis of Cyrene, it was smuggled by convicted antiquites trafficker Emile Saad out of Libya and into Egypt. According to the New York Times, investigators have said that when the statue first hit the market, it had “telltale signs of looting such as earth on the surface and new chips at the base and in the veil.”
The Kuindzhi Art Museum in Mariupol, opened in 2010, a museum dedicated to the influential realist artist, Arkhip Kuindzhi, was destroyed by Russian airstrikes. While the three original works done by Kuindzhi were removed prior to the airstrike, many of the other works are thought to have been destroyed. This is just one of many losses suffered by Ukrainian cultural institutions. See Chatham House updates.
This spring, Center for Art Law brings three hybrid events to the National Arts Club. We hope to see many of you there in person!!
In September of 2022, the Swiss Federal Council, the executive body of the federal government of the Swiss Confederation, voted to create an independent commission on Nazi looted art. The independent expert commission’s purpose is to make recommendations regarding the return of “cultural property seized as a result of Nazi persecution.”
The proposal to create this commission was the by-product of ongoing national debate and most recently criticism sparked by the long-term loan display of the Emil G. Bührle collection in the newly opened wing of the Kunsthaus Zürich. Emil G. Bührle (1890-1956) was a German-born art collector, patron, and arms manufacturer. Bührle used slave and child labor in his factories to manufacture weapons and sold these arms to the Nazi regime. With his rapidly growing wealth, during his lifetime, Bührle purchased several works that were looted from Jewish families. As an aficionado of the arts, Bührle did contribute greatly to Kunsthaus Zürich. Bührle was a member of Kunsthaus Zürich’s collection committee, financed an exhibition wing, and in 1952, he donated two large Monet water-lily paintings to the museum. After his death, Bührle’s heirs set up a foundation, the Emil Bührle Collection, which oversees display of a third of the works he collected.
The Emil Bührle Collection claims that none of the items on display were looted from Jewish individuals. However, there are accusations that the provenance of some of the works in the collection may have been whitewashed and that the collection may still include Nazi looted art. The newly installed display of the Emil G. Bührle collection in Kunsthaus Zürich as of 2021 resulted in an online petition, calling for more transparency in the museum’s Bührle displays. The exhibition also drew criticism from former members of the Bergier Commission. The Bergier Commission was an international panel of scholars formed by the Swiss Federal Assembly in 1996 to research Swiss financial dealings before, during, and after the Second World War. The commission dissolved in 2001. Due to the vast amount of criticism, the city of Zürich pledged to conduct an independent investigation of the Bührle Foundation’s provenance research and to work with Kunsthaus Zürich to develop the museum’s Bührle displays.
CREATION OF THE INDEPENDENT COMMISSION
In response to the Bührle controversy and the resulting public pressure, lawmaker Jon Pult submitted a motion in December of 2021, urging parliament to set up an independent commission to assess claims for “cultural property lost as a result of Nazi persecution.” Such a commission would follow in suit of only a handful of countries, Germany, Austria, France, the Netherlands, and the United Kingdom, which have created independent panels to make recommendations and assess claims for Nazi-looted art.
In February of 2022, the Swiss Federal Council partially approved a parliamentary motion to establish the independent expert commission to make recommendations on the returning cultural property lost in the aftermath of Nazi persecution. However, concerns were raised with the use of the term “cultural property seized as a result of Nazi persecution.” Pult expressed concern that the approved but modified motion did not create a strict distinction between “looted art”—art stolen by the Nazis, and “escapee art”—works that Jewish people were forced to sell under duress at low prices. The Swiss Federation of Jewish communities (SIG/FCSI) and the Platform of Liberal Jews in Switzerland (PLJS) joined in Pult’s concerns and they continue to demand the use of the term “Nazi-confiscated cultural property.” The SIG/FCSI and PLJS have also expressed disappointment in the rejection of their proposed framework conditions.
In September, following the National Council of Switzerland (the lower house of the Federal Assembly of Switzerland), the Council of States of Switzerland (the upper house), adopted a corresponding motion on Monday. However, the motion was shortened and six guidelines for the design of the commission were deleted. The Council of States also decided to establish a national database to collect and research the provenance of artworks traded, collected, or exhibited in Switzerland. Due to the changes to the motion, it must go back to the National Council before the commission can be set up by the Swiss Federal Council.
About the Author: Nikki Vafai is a law student at the University of Maryland Carey School of Law and holds a B.A. in International Affairs and Art History from the George Washington University. Nikki is a 2022 fall legal intern at the Center for Art Law.
Credit: DALL·E 2; text prompts (left to right): painting of a robot holding justice scales; painting of a robot-artist painting flowers; painting of a robot reading a law bookWhat does it take to be an artist in the 21st century? Can one create art with paint brushes, watercolors, or oil pastels? Or can one simply think art into existence? ‘AI’ artwork generators like DALL·E and Stable Diffusion, offer users the ability to quickly create detailed images based on prompts, which can be anything you think of— An astronaut surfing in Times Square? A lawyer relaxing on the beach? (one could dream!) or a robot learning the law… in the artistic style of Da Vinci? You got it. However, when the idea is realized and the masterpiece has been generated– who owns it? who is the maker? the ‘AI’ or a copyright holder that the artwork is based on? Who has a perfected (or any) claim of co-authorship? Who can commercialize these images? Can someone be sued for infringement if they use the image without permission?
Introducing DALL·E 2
Artists build autonomous robots to collaborate with– they feed algorithms with data, and train machines to generate different kinds of visual works.Creators, such as Google Arts & Culture Lab, work with computer programs that mimic the human mind to generate a never-ending stream of unique artworks. Artificial intelligence has therefore emerged as a desirable collaborator in artistic creation. While AI-produced art has been around for some time, software released this year including, DALL·E 2, Midjourney AI, and Stable Diffusion, has allowed even the most inexperienced artists to produce intricate, abstract, or photorealistic compositions by merely typing a few words into a text box. DALL-E 2 is learned by an OpenAI model called CLIP (Contrastive Language-Image Pre-training) which functions as the main bridge between text and images. Through machine learning, AI is trained in data and is now able to create images and generate art by itself. The training data in this case is an aggregate of large datasets of images and tagged images labeled into a set of categories, across the internet, out of which most images are likely protected by copyright. The output images that these tools can generate are figurative-looking — in that it is believable that the artwork could have been created by a real person or artist.
OpenAI, an artificial intelligence research laboratory, was founded in San Francisco in late 2015 by Carlos Virella, Elon Musk, Greg Brockman, Ilya Sutskever, Sam Altman and Wojciech Zaremba, who collectively pledged one billion U.S dollars. OpenAI released its text-to-image generation model based on transformers architecture called DALL·E. The name of this model is inspired by surrealist painter Salvador Dali and the robot from Wall-E. OpenAI initially developed the GPT (Generative Pre-trained Transformer) model that its DALL·E software used in 2018, and just four years later the software is capable of generating imagery in myriad styles, manipulating and rearranging objects within its images and accurately designing novel compositions without explicit instruction. It has even proven to be capable of solving Raven’s Matrices – visual tests used to measure human intelligence – showing that DALL·E can express both geographical and temporal knowledge, where it has an understanding of places, concepts and how they change over time.
DALL·E 2 (2022) is the new version of DALL·E (first released in January 2021)and can make realistic and context-aware edits, including inserting, removing, or retouching specific sections of an image from a natural language description. It can also take an image and make novel and creative variations of it inspired by the original. DALL·E was trained by learning the relationship between images and the text used to describe them. It uses a process called “diffusion”, which starts with a pattern of random dots and gradually alters that pattern towards a final output. DALL·E “trained” on approximately 650 million image-text pairs scraped from the internet, learning from that dataset the relationships between images and the words used to describe them. But while OpenAI filtered out images for specific content, such as images that violate their content code including pornography and duplicates, and implemented additional filters at the API (application programming interface) level, for example for prominent public figures and likeness of individuals, the company admitted that the system can sometimes create works that include trademarked logos or characters. In their Press release dated April 6, 2022, the company stated that “the model can generate known entities including trademarked logos and copyrighted characters. OpenAI will evaluate different approaches to handle potential copyright and trademark issues, which may include allowing such generations as part of “fair use” or similar concepts, filtering specific types of content, and working directly with copyright/trademark owners on these issues.”
Copyright, Contracts and Commercialization
It is safe to state that artificial intelligence generated art is here to stay. The success of the model has been such that OpenAI also announced that it will be commercializing DALL.E 2 and its image generation platform. Credits can be purchased to make prompts to generate art. So once an AI-generated masterpiece is created, what’s stopping someone from claiming it as their own and using it commercially or preventing others from using it? Who owns these DALL·E outputs? Is it OpenAI? The person who writes the prompts? Or is it nobody’s at all?
On top of existentially threatening the very concept of artists and creatives, AI-generated content raises several new legal issues. Copyrights are a form of intellectual property protected by federal law. Owning a copyright gives the owner the exclusive right to reproduce, publish, or sell an original work of authorship, such as a book, a painting, or a song. Under current copyright law, artists using traditional mediums, such as paint, pen, or paper, are considered the authors of the work and generally hold copyright over their work by default. The fundamental question before addressing AI-created art is whether copyright can belong to anyone other than a human being. The Naruto Case throws some light in understanding the matter and answers this question.
David Slater, a British (and very much human) wildlife photographer, set a camera up on the island of Sulawesi and had left the camera unattended. A handsome and rather curious young gentleman (a monkey) named Naruto clicked the button while looking at the camera, capturing selfies showing off his photogenic side. Following this, Slater published a book featuring the selfie and other pictures that had been taken by Naruto. In response, the People for the Ethical Treatment of Animals (PETA) filed a complaint against him and the publisher, representing Naruto, and argued that he had “the right to own and benefit from the copyright in the Monkey Selfies in the same manner and to the same extent as any other author.”Further, it was argued that while the claim of authorship by species other than homo sapiens may be novel, “authorship” under the Copyright Act, 17 U.S.C § 101 et seq., is sufficiently broad so as to permit the protection of the law to extend to any original work, including those created by Naruto. However, the US. Copyright Office stated that they “will refuse to register a claim if it determines that a human being did not create the work.” The office also said that it would exclude works “produced by machine or mere mechanical process that operates randomly or automatically without any creative input or intervention from a human author.”
Although copyright law doesn’t specifically address artificial intelligence, or even human authorship of original art, protection under the Copyright Act must meet the following requirements:
an original work of authorship;
fixed in a tangible medium;
that has a minimal amount of creativity.
If a work of art doesn’t meet all three of these requirements, then it does not qualify for copyright protection. Copyright cannot belong to the AI itself. Section 306 of The Copyright Act protects “original works of authorship,” which implies a human hand in the process. The Act makes the human requirement clear: “The U.S. Copyright Office will register an original work of authorship, provided that the work was created by a human being.“ This means that, under the current rules, AI-generated art has no owner.
Copyright protection in art is given as soon as the work is created, so the creator has exclusive right to decide the future use of the work. But since machine-created may not need the criteria for copyright protection, ownership may not be clearly distinguished.
Apart from ownership rights of the AI-generated artwork, there are additional copyright concerns that may arise. There may be infringement claims on the final image based on copyrighted artworks inputted into the AI at the time of machine learning which may infringe the rights of copyright holders.
Under the current U.S law, owners of the AI technology itself may be the ones with cause for concern – potentially being at risk of copyright infringement lawsuits. AI usually reviews or even contains reproductions of other people’s artwork that it uses to create new artwork, that new artwork could be an unauthorized derivative, which is an infringement– if the AI also stores a reproduction of that artwork, that too is an infringement. This concerns the owner of the AI who may ultimately be liable for infringement. But since copyright law does not protect AI-generated artwork, it is likely neither the AI nor the AI company has any rights in the image.
“Your Content. You may provide input to the Services (“Input”), and receive output generated and returned by the Services based on the Input (“Output”). Input and Output are collectively “Content.” As between the parties and to the extent permitted by applicable law, you own all Input, and subject to your compliance with these Terms, OpenAI hereby assigns to you all its right, title, and interest in and to Output…”
“Similarity of Content. Due to the nature of machine learning, Output may not be unique across users and the Services may generate the same or similar output for OpenAI or a third party…Responses that are requested by and generated for other users are not considered your Content.”
The second paragraph recognizes the possibility of other creators coming up with similar generated images based on similar prompts and attempts to bypass copyright concerns stating that any prompt generated by another user, which may be similar or the same due to the nature of the machine learning. But the terms simply state that the content would not belong to the creator if it has been generated by another user but provides no guidelines as to who the content then actually belongs to.
The sharing and publication policy also states:
“Creators who wish to publish their first-party written content (e.g., a book, compendium of short stories) created in part with the OpenAI API are permitted to do so under the following conditions….The role of AI in formulating the content is clearly disclosed in a way that no reader could possibly miss, and that a typical reader would find sufficiently easy to understand… People should not represent API-generated content as being wholly generated by a human or wholly generated by an AI, and it is a human who must take ultimate responsibility for the content being published.”
Below, find an image generated on a text prompt including the name brand “Gucci.” The software has likely been inputted with alternate images that circumvent any identifying trademark or brand name or logo, but still make for interesting and even amusing artworks when certain terms are inputted. In this case, with subtle inferences to luxe looking hand bags and spoiled pooches. Art in its own sense, perhaps?
OpenAI also gives users full usage rights to commercialize the images they create with DALL·E, including the “right to reprint, sell, and merchandise.” To be clear, this doesn’t mean OpenAI is relinquishing its own right to commercialize images users create using DALL·E. Deeper into the terms of service, you will find that “OpenAI will not assert copyright over Content generated by the API for you or your end users.” OpenAI is signaling to users that they are free to commercialize their DALL·E images without fear of receiving a cease-and-desist letter from a company that could sue them from profiting from the images created. This does not restrict a third party from suing the user of a DALL·E image or the sale of an AI-generated artwork. However, the terms of service also put users on notice that OpenAI “may change these Terms or suspend or terminate your use of the Services at any time.” Which means that the legal concerns can become more pressing in time. With the inherent lack of paternity or authorship of the work by the AI itself and potentially infringing datasets that AI has learned, the creators may ultimately be liable for infringement of copyright when the images are used.
Ultimately humans are the ones that make the final decision to use art generated by a machine (to illustrate their articles for example); therefore, AI clearly cannot grant permission for use of the work or hold a copyright for the same. The Naruto case was decided as it was for this reason. If there was substantial contribution from a team or a person who provided substantive inputs deemed creative enough for the ultimate output of the work, then they could potentially own copyright in the work. If the design, however, was significantly attributed mainly to the AI or the program, then the work would likely not be copyrighted and would possibly belong in the public domain. The future in terms of legal protection of these works is still questionable, as it is difficult to assess the full extent to which AI will be used in creative works. For now, it seems likely that creators can continue to use DALL·E 2 and generate images that can be used commercially with no fear of being sued from OpenAI or DALL·E 2, provided all the terms and content policy of the software are complied with. However, it would be wise to proceed with caution, especially if commercializing the images, keeping in mind that the final images produced may still infringe on another’s copyright or the likeness of a subject in the AI-generated images.
In other intellectual property realms, the patent world is discussing whether an AI can be listed as an “inventor” on a patent application. While not directly comparable, since the standards for “authorship” and “inventorship” are different, it is a notable step for understanding AI ownership rights, and as laws evolve with society, it isn’t beyond imagination that Artificial General Intelligence may find its way as a “legal person” or may have laws specifically drafted for its regulation and ownership in the near future.
The risks associated with using models like DALL·E to generate art are still largely unknown as they have not been contested or substantially tested in any courts. The usage of any of these software or programs do come with their own contracts, terms of service, license agreements and limitations. Such terms can impose restrictions on who owns the final output, what can be done with the generated art, the content permitted to be generated, commercialization of artwork and risk and liability of using the artwork. Being aware of what is expressly permitted and prohibited when using such tools becomes critical as one’s ability to use it may be rescinded or considered infringing if the terms are violated. It may be wise to consider not using any artist’s name or work in the generation of artwork, and explicitly mentioned the artwork was created by AI — especially in cases where the styles or similarities to artists is still under copyright protection. It may be argued that regardless of initial images inputted in, the artwork is transformative enough to be fair use of the artwork, but this is a defense against infringement and may be challenging to prove depending on the case. Without knowing the specifics of the AI and the prompts used, it will be difficult to give a definitive answer on when the work would be infringing and who has ownership of the artwork when similar artworks based on similar, or the same prompts can be generated.
Atreya Mathur is the Director of Legal Research at the Center for Art Law. She was the inaugural Judith Bresler Fellow at the Center (2021-22) and earned her Master of Laws Graduate from New York University School of Law where she specialized in Competition, Innovation, and Information Laws, with a focus on copyright, intellectual property, and art law.
Stock language suggested in the terms to describe the creative process, provided it is accurate:“The author generated this text in part with GPT-3, OpenAI’s large-scale language-generation model. Upon generating draft language, the author reviewed, edited, and revised the language to their own liking and takes ultimate responsibility for the content of this publication.” ↑
The Supreme Court waited 27 years after deciding the 1994 landmark case of Cambell v. Acuff Rose to revisit the issue of fair use in Google LLC v. Oracle America Inc. Decided in 2021, the court took an expansive view of the doctrine of fair use, agreeing that Google “reimplemented,” technology in a new context. Now, less than two years later, the Court in Warhol Foundation v. Goldsmith is again considering the scope of the fair use doctrine in copyright law. Center for Art Law has followed the case with great interest, written at great length on the issue of fair use, and has covered the oral arguments made by both sides of the Warhol v. Goldsmith controversy; this article revisits the facts of the matter as well as attempts to explore the possible ramifications ahead of the Supreme Court’s decision.
Following three years of litigation, the Andy Warhol Foundation (AWF) successfully petitioned the Supreme Court to review a copyright infringement case that has garnered the attention of the public as it made its way from trial to the court of appeals. At its center is a decades-old photograph of the pop star Prince, a series of pieces by Andy Warhol based on that same image, and the doctrine of fair use.
“Let the little things that would ordinarily bore you suddenly thrill you,” said Andy Warhol, visual artist and champion of the pop art movement. Beginning his career at a time when beauty embraced realism and elevation, Warhol couched his philosophy in the exact opposite by finding beauty in the mundane and the ordinary. Warhol’s musings remind us of the axiomatic, that inspiration can be found anywhere, and could even allude to a cornerstone of copyright law that receives all that which has been sufficiently transformed as artistic creation.
The controversy stems back to 1984 when Vanity Fair decided to publish an article about Prince in a magazine. Vanity Fair reached out to a licensing agency that managed Lynn Goldsmith, a celebrated rock photographer, in search of a photograph of Prince. The agency, on a one time basis, granted the use of a particular photograph. Vanity Fair then commissioned Andy Warhol, just three years before he died, to create a piece to accompany the article based on the licensed photo. Warhol made a number of screen prints, though only one was selected for the Vanity Fair article.
Prince died in 2016 and Vanity Fair decided to publish a special article about his legacy as an artist. Vanity Fair then contacted the Andy Warhol Foundation, a New York nonprofit that licenses the artist’s works. It was during this exchange that Vanity Fair learned that Warhol had created multiple prints based on the Goldsmith photo of Prince provided in 1984 for the original article. Vanity Fair then chose a different screen print of the selection to use in their special article. Goldsmith saw the special issue and contacted the Andy Warhol Foundation about her copyright claim and immediately registered the photo of Prince as an unpublished work (VAU001277562 / 2016-11-17).
Preemptively, the Andy Warhol Foundation sued for declaratory judgment, confident that the work selected had been sufficiently transformed and was not substantially similar, thus avoiding infringement of Goldsmith’s copyright. The trial court granted the foundation’s motion for summary judgment claiming fair use and denied Goldsmith’s cross motion for summary judgment claiming copyright infringement. The trial court reasoned that Warhol’s treatment of the Prince image conveyed new meaning and message noting numerous artistic differences, particularly Warhol taking no more than what was necessary for his transformation.
Goldsmith appealed the trial court’s ruling and brought their reasoning before a panel. Contrary to the trial court’s decision, the panel found that the photograph was not transformative and concluded, in addition, that judges are ill-suited to decide “the meaning or message” of art works. The panel provided that, in assessing the degree of transformation a piece has undergone, judges must compare the pieces side by side and consider, if outside of the artist’s intent, whether the resulting work is fundamentally different and new.
Using the test enumerated above, the panel concluded that Warhol’s Prince Series still retained essential elements of its source material and the Goldsmith photo, despite the artist’s attempts to imbue it with new meaning, remains the recognizable foundation of the piece. The panel further reasoned that while the pieces occupy different markets, Warhol’s rendition still harms Goldsmith’s ability to license the photo to publications and to other artists so that they might create derivative works.
Individuals and organizations alike wrote amicus briefs ahead of the case’s arrival to the Supreme Court. Most notably, the Copyright Office, based in Washington D.C., has aligned itself with the National Press Photographers Association and the American Society of Media Photographers backing Goldsmith and urging the court to rule in her favor. Collectively, they advance that “the fair use defense was never meant to give infringers a pass so long as they claim some new subjective ‘meaning or message’ in their derivative use regardless of how it is used … [AWF’s] argument that a derivative use of a copyrighted work should be found ‘transformative’ so long as it adds any cognizable echo of ‘new meaning or message’ ignores the plain language of the Act and invites the fair use exception to swallow the derivative use rule.”
Conversely, museums, professors of art and law, and organizations such as the Robert Rauschenberg Foundation and the Roy Lichtenstein Foundation have drafted amicus briefs in favor of AWF. Overwhelmingly, they emphasize the importance of copying to visual art and its link to creativity. Those siding with AWF argue that they intend to protect artistic progress, and by consequence, they recognize that artists must have room to build on, be inspired by, and transform works that came before them.
At present, Chapter 17 of the United States Code provides that copyright protection “subsists, in … original works of authorship fixed in any tangible medium of expression.” The standard for originality is not expressly provided for in Chapter 17. The court in Bleistein v. Donaldson, however, ruled that original meant “created organically by an author [with] some degree of creativity.” 17 USC 102(a) define works of authorship as literary works, musical works, dramatic works, pantomimes and choreographic works, pictorial graphic and sculptural works, motion pictures, audiovisual works, sound recordings, and architectural works. Finally, fixed, according to 17 USC 101, means “perm[inence] or [the ability] to be perceived, reproduced, or otherwise communicated for a period of more than transitory duration.”
The fair use provision, Section 107 of the Copyright Act, states:
Notwithstanding the provisions of section 106 and 106a, the fair use of a copyrighted work, including such use by reproduction in copies or phonorecords or by any other means specified by that section, purposed such as criticism, comment, news reporting, teaching (including multiple copies for classroom use), scholarship, or research, is not an infringement of copyright. In determining whether the use made of a work in any particular case is a fair use the factors to be considered shall include – (1) the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes; (2) the nature of the copyrighted work; (3) the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and (4) the effect of the use upon the potential market for or value of the copyrighted work.
Whether you find yourself siding with Goldsmith or AWF, it is important to acknowledge the implications of the Supreme Court should it decide against adhering to its own standard. Primarily, a decision contrary to precedent puts the onus on judges to inspect the similarity of two works of art. Should the judge be unable to look past visual similarities then the argument is moot, regardless of training or expertise. Historically, art is filled with pieces that are similar since aspiring artists naturally study the works of masters and those they look up to. What is more insidious and harrowing, however, is the sudden triumph of copyright over the right to free speech, where the Supreme Court has made it clear time and again that it is inviolable. A ruling in favor of Goldsmith allows copyright to overreach, thus chilling the rights of artists who express themselves through image. The doctrine of fair use is just as germane to copyright as it is to free speech.
It is important to understand that while AWF has raised fair use as a defense to copyright infringement, it is more than an affirmative defense. Fair use is the crux of copyright. If the purpose of the copyright clause in our constitution is to encourage the continued proliferation of creative works then fair use ensures that artists can create new works that continuously build on the works of their predecessors and draw inspiration from the world around them – this is the essence of creativity and the goal of copyright law itself. As the Supreme Court has enunciated in the past, fair use is a first amendment “safeguard,” functioning to ensure that copyright is an engine to freedom of expression, not a hindrance.
About the Author:
James Parker is a recent graduate of New York Law School, class of 2022. While in law school most of his studies orbited Intellectual Property law drawing a particular interest in copyright. Parker recently sat for and passed the July 2022 administration of the Bar and is Center for Art Law’s current Judith Bresler Fellow.
Brief for the American Society of Media Photographers et al. as Amicus Curiae Supporting Respondents, Andy Warhol Foundation for the Visual Arts, Inc. v. Goldsmith, No. 21-869 (2nd Cir. Oct. 12, 2022). ↑
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Today, Henry Darger (1892-1973) is known to the world as an artist celebrated for vibrant and vividly-colored drawings that now command up to $800,000. During his lifetime, however, Darger’s talents were unknown to the world; a custodian by day, Darger kept his art to himself. In 1972, Darger moved out of the Chicago, IL apartment he’d rented from Nathan and Kiyoko Lerner for over a decade, leaving behind thousands of pages of drawings, paintings, and collages. Darger passed away one year later in a Chicago nursing home, with no known family or close friends, but his work soon took on a new life in the public eye.
Darger is often referred to as an ‘outsider artist:’ an artist with little formal training in the arts and little or no contact with the professional art world. Only upon Darger’s death were his works published, promoted, and ultimately celebrated thanks to the efforts of Kiyoko and Nathan Lerner, who salvaged and promoted Darger’s works in lieu of disposing of them with the other items Darger left in the apartment. Since Darger’s death, the Darger works have been shown at the Museum of American Folk Art, The Center for Intuitive and Outsider Art, and various other museums and galleries. The Darger works now command hundreds of thousands of dollars and have been sold through auction houses like Sotheby’s and Christie’s for hundreds of thousands of dollars.
In recent years, however, the legality of the Lerners’ handling of the Darger works has been challenged. Darger died intestate, meaning he did not bequeath his artworks or their copyrights by will to anyone, including the Lerners. In the state of Illinois, when an individual dies intestate with no known kin, the contents of the deceased’s estate go to the state. However, two factors have complicated the matter of who legally owns the Darger estate. First, Kiyoko Lerner maintains that Darger transferred the ownership of his artwork to her during his lifetime, though no written record of this transfer exists. Secondly, several distant relatives of Darger have emerged through the forensic genealogy company HeirSearch. These relatives filed a lawsuit against Kiyoko Lerner (Nathan Lerner passed away in 1997) this past July, seeking compensation for what they allege is unlawful exploitation of Henry Darger’s artwork.
On September 30, 2020, lawyers representing a group claiming to be Darger’s relatives emailed Kiyoko Lerner to inform her of their intentions to recover the physical Darger artworks, the associated intellectual property, and any revenue generated by Kiyoko and Nathan Lerner through what they allege is “misappropriation and unlawful exploitation of the Darger artwork.”
The email alleges that Lerner has no valid right, title, or interest in any physical embodiment of or copyright to the Darger artworks. Furthermore, the email alleges, any claim Lerner makes that Darger gifted his artworks to her husband is “questionable at best–given his deteriorating mental state and conflicting contemporaneous accounts.” Even if Darger did gift his artwork to the Lerners, the email continues, “any such gift would have excluded any intellectual property rights.”
In January 2022, the claimants petitioned the court for probate of the Darger estate. In May 2022, Christen Sadowski, one of the claimants, was named Supervised Administrator of the Henry Darger Estate. The claimants, known as the Estate of Henry Darger, then promptly filed a complaint with the district court against Kiyoko Lerner for the following infractions:
unfair competition and false or misleading description or representation of fact;
a declaratory judgment under the Declaratory Judgment Act;
unfair competition under Illinois common law;
deceptive trade practices;
unjust enrichment under Illinois common law;
an equitable easement; and
conversion under Illinois law.
A Closer Look: Does Kiyoko Lerner Legally Own the Darger Works and Copyrights?
In the United States, laws concerning the transfer of property from a deceased person to their heirs is subject to state law and thus varies depending on the state in which the deceased person resided upon their death. As Darger died intestate in Chicago, the question of who lawfully owns the physical Darger artwork is determined by the state of Illinois.
According to Kiyoko Lerner, when Henry Darger moved out of the Lerners’ Chicago apartment in 1972, he “said they could do whatever they wanted” with the contents he left behind in the room. By the Illinois Lifetime Transfer of Property Act, as long as Lerner’s recollection of Darger’s statement that she and her husband ‘could do whatever they wanted’ with the contents of the room constitutes a valid transfer of property, she legally owns the artwork Darger left in his room.
Without any known written evidence of this exchange between Darger and the Lerners, the plaintiffs contend that this interaction between Darger and the Lerners does not constitute a valid transfer of property. The plaintiffs question the accuracy of Lerner’s claim that Darger gifted his artwork to her and her husband and furthermore question Darger’s soundness of mind at the time Lerner alleges Darger gifted his artwork to her husband. Unless Kiyoko Lerner can find a way to corroborate her claim that Darger, in sound mind, transferred ownership rights of his artwork to her or her husband, it will be difficult for her to prove that Darger transferred his artworks to her.
However, there is another avenue Lerner can take to show that she rightfully owns the physical Darger artworks. In the city of Chicago, when a tenant moves out of a rented property and leaves items behind on the premises, the landlord is required to store the property for seven days after the tenant leaves the property. After seven days, the landlord is free to dispose of the property as they please, including through sale of the property. As Darger lived for another year after moving out of the Lerners’ Chicago apartment and did not pick up his artwork within seven days of moving out of the apartment, the Lerners have a strong case that they had the right to do what they wished with the physical Darger artworks.
Aside from the question of who owns the physical Darger works, there remains a separate question as to whether Kiyoko Lerner owns the copyrights to Darger’s art. In the United States, copyright ownership does not transfer with the ownership of the physical object. Furthermore, under federal law, a transfer of copyright ownership is not valid, other than by operation of law, unless an instrument of conveyance, a note, or a memorandum of the transfer is in writing and signed by the owner of the rights conveyed or such owner’s duly authorized agent. The plaintiffs contend that Lerner is not the valid copyright owner of Darger’s artwork. The law is on the side of the plaintiffs, in this case: since Darger did not transfer the ownership of the copyrights to his artworks to the Lerners, and since the Lerners are not kin to Darger, Kiyoko Lerner likely has no claim to the copyrights of the Darger artworks.
If not Kiyoko Lerner, Who Owns the Darger Copyrights?
While he was alive, Darger, as the creator of his artworks, owned the copyrights to the Darger works. The copyrights to any work exist for 70 years after the death of the creator and may be inherited by the creator’s heirs. Because Darger died intestate, Illinois state statutes determine who lawfully inherited his work upon his death. By 755 ILCS 5/2-1, since Darger died without a spouse, living parents, siblings, or children, the estate goes to the descendants of any kindred to Darger.
It appears that Christen Sadowski, the plaintiff who was named supervised administrator of the Darger estate this past May, is one of these descendants. According to court papers, upon being granted this role, Sadowski was authorized to take possession of the physical Darger artworks and their associated copyrights. The plaintiffs seek relief in actual damages, the actual amount of which, they have specified, they want to be determined at trial.
Kiyoko Lerner has held that, while Darger was alive, she and her husband often checked in on him to ensure that he had sufficient food and proper living arrangements. Despite pressure from neighbors to cease renting to Darger due to his disheveled appearance, the couple continued renting to Darger, even lowering his monthly rent from $40 to $30 so that he could afford to stay. With no kin to care for Darger, it was the Lerners who arranged for Darger to move into a charity nursing home in 1972, after which time Kiyoko Lerner claims they approached Darger to see what he wanted done with his materials, including his artworks.
And yet, without a will to communicate Darger’s wishes, the ownership of Henry Darger’s artworks and their copyrights has gone to Christen Sadowski and other relatives who Darger never knew. These relatives, contending that Lerner unlawfully exploited Darger’s artworks, seek to be awarded with all profits the Lerners made in managing the Darger artworks as well as punitive and statutory damages and other forms of relief for the Lerners’ alleged wrongdoings.
Since the Estate of Henry Darger seeks a jury trial to determine the actual amount of damages they receive, the outcomes of this case are not easily predictable. It may be possible that Lerner’s description of her personal connection to Darger will be a more significant factor to the jury in determining the amount of damages owed to the Darger Estate than it was for the judge who granted Sadowski supervised administrator of the Darger Estate. Perhaps this trial will be an opportunity for Darger’s wishes concerning the inheritance and use of his work to be considered.
At only 33, Inigo Philbrick managed to quickly rise in the art world and become an extremely prominent blue-chip art dealer, specializing in postwar and contemporary art. He not only owned two art galleries in Miami and London, he also dealt with some of the most sophisticated collectors in the world. However, unbeknownst to those dealing with him, the young dealer had sprinted to his position in the art world by masterminding a scheme that defrauded countless collectors, investors, and lenders. Just as quickly as he rose to prominence, his scheme unraveled. By 34, he was already sentenced to seven years in prison.
Philbrick’s scheme thrived with the help of others, such as his business partner Robert Newland, who pleaded guilty to a count of conspiracy to commit wire fraud. The case heard in the Southern District of New York left many wondering how a young dealer could deceive individuals who were experts in their own right and how lasting the damage of the Philbrick machinations would be.
In 2013, Philbrick decided to launch his independent career in the art world. Philbrick built his business by operating in the secondary market, collateralizing and reselling fractional shares in contemporary art. From about 2016 to 2019, according to the Department of Justice, Philbrick is alleged to have made material misrepresentations and omissions to art collectors, investors, and lenders. His actions include selling more than one-hundred percent ownership in an artwork to multiple parties without their knowledge and selling or using artworks as collateral on loans without the knowledge of the co-owners or disclosing the ownership interests to the buyers and lenders. Philbrick also presented fraudulent contracts and records to investors in order to inflate the artwork’s value and fraudulently used the identification of others.
Over the years, to which he pleaded guilty, Philbrick obtained over $86 million in loans and sale proceeds. However, in 2019, investors and lenders began to learn of the fraudulent records they had been provided by Philbrick and the material misrepresentations and omissions he had made. In October 2019, one lender notified Phibrick that he was in default, and shortly after, various investors began to file civil lawsuits in various jurisdictions.
Philbrick’s galleries in Miami and London closed and Philbrick fled the country to Vanuatu, but in 2020 he was arrested by U.S. Marshals. Philbrick was charged with one count of wire fraud and one count of aggravated identity theft.
With regards to the first count charged, wire fraud, the U.S. prosecution argued that Philbrick, with others, devised and intended to devise a scheme defrauding collectors, investors, and financial lenders by providing false information and false documents regarding the sale, ownership, and provenance of artworks. The U.S. government claimed Philbrick obtained funds through wire transfer.
As for the second count, aggravated identity theft, the prosecution argued that Philbrick knowingly and unlawfully used the identification of someone else. They revealed that Philbrick used the name and signature of an officer of a Pennsylvania-based company to create a false art sale contract.
In its complaint, the U.S. prosecution described Philbrick’s various unlawful activities such as his misrepresentations of Jean-Michel Basquiat’s “Humidity” and Christopher Wool’s “Untitled.” The U.S. prosecution also highlighted Philbrick’s fraudulent activity with regards to Rudolf Stingel’s “Picasso,” selling a total of more than one-hundred percent ownership in the painting to three investors.
Philbrick originally entered a plea of not guilty but eventually entered a plea of guilty to Count 1, wire fraud. Many court documents in the case have been sealed, so the defense’s exact arguments are unknown.
On May 23, 2021, Philbrick pleaded guilty to count one, wire fraud, in the indictment. He was sentenced to seven years in prison. The court recommended to the Federal Bureau of Prisons that Philbrick be admitted to the Residential Drug Abuse Program, if he meets the requirements for the program. The court also sentenced Philbrick to two years of supervised release upon completion of his imprisonment. The court ordered Philbrick to pay forfeiture in the amount of $86,672,790.00 and restitution in the amount of $82,592,367.00.
While Philbrick’s web of lies ultimately unraveled, the case highlights the consequences of greed and sheds light on the institutions and actors who knowingly or unknowingly facilitate such schemes. There has been much debate surrounding the transparency of the art market, and schemes like Philbrick’s leave the question of what more can be done in order to prevent such schemes from occurring in the future and increase confidence in the art market.
About the Author: Nikki Vafai is a law student at the University of Maryland Carey School of Law and holds a B.A. in International Affairs and Art History from the George Washington University. Nikki is a 2022 fall legal intern at the Center for Art Law.
At the intersection of politics and culture there is usually a robust repelling force keeping the two from fully understanding one another. This force is made up of partisan policies, modern-day climate concerns, and economic issues all mingling with vestiges of history. On November 15, 2021, a long running conflict was brought to a head when a proposal for enacting a 20-year moratorium on oil and gas drilling around Chaco Culture National Historical Park (Chaco) was announced. Advocates who have been working for such a ban for decades cheered while opponents grumbled. At the center of the issue is a cultural landmark with a birthdate of approximately 850 A.D., outlasting either side of the current debate.
To understand the importance of such a proposal by the Biden Administration, the importance of Chaco must initially be understood. This article will briefly attempt to first explain the history and cultural significance of the historic park and then summarize the legislative build-up to the current moratorium as well as what it actually calls for. Finally, a short synopsis will be provided looking at the reasoning behind both the proponents and opponents of the drilling ban and buffer. From a birds-eye view, this is an attempt to better understand the various influences affecting policies which aim to protect the integrity of cultural heritage.
What is Chaco Culture National Historical Park and Why Does It Matter?
Chaco refers to a southwestern United States’ cultural complex containing over 4,000 archaeological sites on the Colorado plateau of the San Juan Basin in New Mexico. It was designated as a World Heritage Site by UNESCO for its “monumental public and ceremonial buildings and architecture,” the remarkability of which is due to the level of preservation maintained in such a climatically harsh geographic area as well as the level of craftsmanship by the creators. These sites are associated with Paleo-Indian, ancestral Puebloans, Navajo, and Euro-American interactions and occupations.
In 1907, Chaco became a national park after President Theodore Roosevelt signed the Antiquities Act of 1906. In fact, it was Chaco that initiated the enactment of such legislation due to the damage being done to it at that time which alarmed archaeologists. Such an enactment granted the park federal protection in preserving Chaco’s “extensive cultural system,” which included landscaping and architecture oriented “in accordance with solar, lunar, and cardinal directions potentially to capture the various solar and lunar cycles.”
If one still wonders what exactly makes Chaco so important, beyond its historical and cultural significance mentioned previously, it remains a sacred site for Native Americans to this day. The descendants of those who inhabited Chaco are the modern-day Hopi, Pueblo peoples of New Mexico, and the Navajo. According to President of the Navajo Nation Russell Begaye, in a 2017 press release, “We are descendants from the Chaco Canyon area. We are connected to these lands spiritually. The voices of our ancestors live in this area and any disturbance to this area is culturally and morally insensitive.”
What is the 20-year moratorium on oil and gas drilling around Chaco?
To understand the moratorium that has been proposed is to understand the years of advocacy and push-back that led up to its inception. In 2018, the former Secretary of the Interior Ryan Zinke delayed a lease proposal in an attempt to protect 4,000 acres of Chaco while requesting that more cultural research on the land take place. Zinke’s efforts were made moot when the Trump Administration approved leases for drilling to take place on 2,300 oil and gas wells. This action was subsequently followed by Congress enacting a moratorium for a one-year period on drilling. Any further efforts by Congress to create a permanent barrier around Chaco via legislation failed, but hope was restored in the new Department of the Interior’s Secretary Deb Haaland and her position’s authority to create such a barrier granted by the 1976 Federal Land Planning and Management Act.
Finally, at the White House Tribal Nations Summit of last year, President Biden and Secretary Haaland introduced the executive order that would, in theory, put into action the long sought after moratorium. The goal of the summit was to provide “an opportunity for the President and senior leaders from his administration to meet with tribal leaders and engage in Nation-to-Nation dialogue on critical issues in Indian Country.” This executive order by President Biden would direct the Bureau of Land Management (BLM) to begin protecting the federally owned lands within the 10-mile radius around Chaco from future oil and gas drilling. The Biden Administration summarized the efforts to protect Chaco in the Summit’s Progress Report published by the White House:
“For the past decade, Pueblos and Tribes in Arizona and New Mexico have raised concerns about encroaching oil and gas development threatening sacred and cultural sites, and Congress has passed a series of actions to temporarily defer new leasing. In the coming weeks, the Department of the Interior will initiate consideration of a 20-year withdrawal of federal lands within a 10-mile radius around Chaco Culture National Historical Park, protecting the area from new federal oil and gas leasing and development. The proposed withdrawal will not apply to Individual Indian Allotments or to minerals within the area owned by private, state, and Tribal entities. The action will also not impose restrictions on other developments, such as roads, water lines, transmission lines, or buildings. To support conservation of the area, the State of New Mexico Land Office has implemented a moratorium on new state mineral leases within a 10-mile radius of Chaco Culture National Historical Park.”
The proposal will be subject to a public comment period, environmental analysis, and formal tribal consultation during the first two years of the moratorium on creating new oil and gas drilling leases in the 10-mile buffer around Chaco. This concern over protecting Chaco follows President Biden’s administration’s restoration and expansion of protections over other culturally important parks such as the Bears Ear National Monument and the Grand Staircase-Escalante, both of which are located in Utah.
Who are the opposing teams in support of and opposing the ban?
For those in support of the moratorium, the cultural, historic, and environmental significance of preserving the park is obvious. Fracking has been and continues to be a controversial method for extracting natural gas from the earth. In regards to Chaco, the main concern is that drilling could cause beyond-the-surface damage, destabilize underground structures, and potentially cause earthquakes underneath important Chaco architecture.
Yet, for the opposing side, concerns of arbitrary political maneuvering and a lack of accurate tribal representation outweighs the need for such a buffer zone around Chaco. In regards to the amount of land being protected in the buffer zone, Robert McEntyre, New Mexico’s Oil and Gas Association representative, questioned the “arbitrary limits on development in the region [which] will only disrupt the largest and most successful part of New Mexico’s economy. Other concerns expressed by figures such as Bruce Westerman, a representative of Arizona, also focus on the economic impact of “[s]hutting down safe, reliable pipelines” and thus, “eliminating thousands of technical jobs and thwarting energy development at every turn…”
Those somewhere in between supporting the proposal and opposing it question whether the ban itself will have any effect on actually protecting Chaco and if it is too late already. “[I]n 2014, NASA satellites detected clouds of methane gas from thousands of leaking wells and pipelines” in the area along with approximately 30,000 inactive wells from drilling in the area that “will never be plugged and reclaimed.”
Beyond just being concerned with the physical effect on Chaco, there is an equally, if not greater, alarming factor involved: lack of tribal representation and consultation. The Navajo Nation ultimately withdrew their support of the proposed moratorium since it would also take away their agency to lease their lands as they see fit. This is yet another move by the federal government, in a long line of moves regarding tribal lands, done without thorough consideration of tribal voices. A press release from the 24th Navajo Nation Council stated their position:
The Biden Administration bypassed previous requests to Congress for field hearings and for leaders to hear directly from our Navajo families affected in the Chaco Canyon region. The position of the Navajo National Council is for the creation of a 5-mile buffer within and around this sacred site. It is important that the federal government consider and work with our Navajo allottees to further advance development. The Administration must respect our tribal sovereignty and what the government to government relationship entails.
Conclusion: is there a middle ground?
It is safe to say that no branch of government – nor person, ever – will create a law or policy that satisfies everyone. There is no political panacea. Yet, without such structures, a vital aspect of our democracy will crumble. It is a fact that Chaco Culture National Historical Park holds unparalleled cultural and historic value, not just for the United States but for global society as well. It is also true that sustaining economic opportunities for American citizens is important. Perhaps, then, the issue is not in choosing one over the other but in discerning the means by which we can achieve both ends. The means of which must include those directly involved and descending from Chaco ancestors: Tribal Nations. Voices of whom have been repeatedly ignored for centuries and could provide solutions that are able to strike a balance between economic and cultural priorities.
About the Author: KimberMarie Faircloth is a law student at Elon University School of Law and has a B.S. in Anthropology from the College of Charleston. KimberMarie interned for California Lawyers for the Arts this past summer, is currently a Staff Member for Vol. 16 of the Elon Law Review, and co-hosts Law School Crucible, a podcast for first-generation law students.
The history of New York’s statutory law pertaining to the art market is relatively brief despite the state’s long held status as the art capital of the United States, if not the world. As visual arts continue to evolve in complexity, lawsuits between artists and their gallerists, too, have become increasingly more complex. It begs the question of whether New York should expand upon its legislative history with further amendments to the New York Arts & Cultural Affairs (NYACAL) or any other art laws. For example, currently, NYACAL, which governs artist-gallery relationships, does not explicitly address any scenario where the gallerist or merchant funds the creation of an artwork and employs a third party to assist in producing the works nor does it address any of the complications that such interactions can create in an artist-gallerist relationship. NY’s Commercial Code similarly is silent on this point.
On February 23, 2021, Marianne Boesky Gallery, incorporated as Art Works, Inc., (“Art Works”) filed a complaint against sculptor and mixed media artist Diana Al-Hadid declaring that Art Works had an ownership interest in Al-Hadid’s unsold works and was entitled to share in the proceeds from any sale. On May 9, 2022, Justice Louis Nock entered a judgment in favor of Al-Hadid. What sets this lawsuit apart from notable cases between artists and gallerists dealing with the question of ownership, which is clearly stated in NYACAL § 12, is the fact that the gallerist here funded a third party to assist in creation of the works. Terms of ownership set forth in NYACAL do not explicitly address circumstances which include a third party interest and the gallerist’s funding of the creation of works. Thus, this case looks to the terms of the contract.
Al-Hadid and the Gallery entered into a consignment agreement on February 17, 2011, which stipulated the rights to profit off of five sculptures and costs which the Gallery would take on to facilitate the creation, marketing, and sale of Al-Hadid’s five sculptures. The fabrication costs were about $25,000 for each sculpture. In 2019, Boesky terminated its representation of Al-Hadid. At that time, one sculpture remained unsold.
Boesky originally filed suit in 2021, alleging that pursuant to the 2011 agreement, the Gallery was entitled to one-third of the shares of multiple sculptures, plus the one-third share of the fabricator, Graphicstudio. Previously the Gallery had purchased these interests from the fabricator. The Gallery asserted that it was entitled to a share of ownership in the unsold work because the Gallery financed Al-Hadid’s fabrication costs and purchased the fabricator’s share in the work. Al-Hadid unequivocally asserted complete ownership of the unsold work, stating that the 2011 Agreement was terminated in 2012 and further, pursuant to the New York Arts and Cultural Affairs Law, the gallery has no greater ownership to the work then Al-Hadid.
A Brief History of New York’s Art Laws
New York State amended its General Business Law to include its first law pertaining to the gallery-artist relationship in 1966, stating that any artwork delivered by the artist to the gallery for the purpose of its sale within the gallery would be deemed to be a consignment and that the gallery is to act as the agent for the artist.  In 1969, the law was amended to require art merchants to act as fiduciaries, making the dealer liable to the artist of the consigned artwork and requiring proceeds of a sale of consigned artwork to be held in trust by the gallery for the benefit of the artist (here, the consignor). The gallery must “deal fairly and honestly with the artist, to account periodically to the artist as to dispositions of the property, and to disclose to the artist all information relevant to the subject matter of the agency.” In 2011, New York finally modified the Arts and Cultural Affairs Law, 45 years after its initial effort to protect artist’s rights in relation to the art market, and in 2012, amended its Arts and Cultural Affairs Laws to allow for criminalization of gallerists and art merchants who fail to act responsibly with regards to payments received for the sale of an artwork, further regulating their fiduciary duty in consignment agreements. Currently, after an even more significant boom in New York’s art scene, with over 1,000 galleries in New York City alone, this codification has not been amended in respect to ownership of art co-produced.
Now, the relevant section of NYACAL reads in part:
NYACAL § 12.01 (a), (c):
1. Notwithstanding any custom, practice or usage of the trade, any provision of the uniform commercial code or any other law, statute, requirement or rule, or any agreement, note, memorandum or writing to the contrary:
(a) Whenever an artist or craftsperson, or a successor in interest of such artist or craftsperson, delivers or causes to be delivered a work of fine art, craft or a print of such artist’s or craftsperson’s own creation to an art merchant for the purpose of exhibition and/or sale on a commission, fee or other basis of compensation, the delivery to and acceptance thereof by the art merchant establishes a consignor/consignee relationship as between such artist or craftsperson, or the successor in interest of such artist or craftsperson, and such art merchant with respect to the said work, and:
(i) such consignee shall thereafter be deemed to be the agent of such consignor with respect to the said work;
(ii) such work is trust property in the hands of the consignee for the benefit of the consignor;
(iii) any proceeds from the sale of such work are trust funds in the hands of the consignee for the benefit of the consignor;
(iv) such work shall remain trust property notwithstanding its purchase by the consignee for his own account until the price is paid in full to the consignor; provided that, if such work is resold to a bona fide third party before the consignor has been paid in full, the resale proceeds are trust funds in the hands of the consignee for the benefit of the consignor to the extent necessary to pay any balance still due to the consignor and such trusteeship shall continue until the fiduciary obligation of the consignee with respect to such transaction is discharged in full; and
(v) such trust property and trust funds shall be considered property held in statutory trust, and no such trust property or trust funds shall become the property of the consignee or be subject or subordinate to any claims, liens or security interest of any kind or nature whatsoever of the consignee’s creditors.
(c) Proceeds from the sale of consigned works covered by this section shall be deemed to be revenue from the sale of tangible goods and not revenue from the provision of services to the consignor or others, except that the provisions of this paragraph shall not apply to proceeds from the sale of consigned works sold at public auction.
The following is a study of two recent cases that cited NYACAL 12.01 in connection with consignment agreements between artist and galleries that went array: Art Works, Inc. v. Al-Hadid, No. 651267/2021, 2022 N.Y. Misc. LEXIS 2428 (Sup. Ct. New York Co. 2022) and Scher v. Stendhal Gallery, Inc., 983 N.Y.S.2d 219 (App. Div. 2014).
Holding in Art Works, Inc. v. Diana Al-Hadid
Justice Nock ruled that the agreement between Boesky and Al-Hadid “did not evince an intent to create joint ownership in defendant’s work,” and thus the Gallery has no claim to ownership. The agreement only created a consignment through which the Gallery would sell the sculptures for Al-Hadid in exchange for one-third of the sales proceeds. Therefore, the Gallery is only entitled to a share of the proceeds, not a share of the art itself, even if it was unable to recoup the funds advanced for the creation of the sculptures through sale during the term of the agreement. The ruling was appealed and on appeal affirmed in favor of the artist, with attorney fees awarded to Al-Hadid.
This case echoes another lawsuit between artist and gallerist, Scher v. Stendhal Gallery, Inc. In Scher, renowned graphic designer and fine artist Paula Scher sued Stendhal Gallery for the relinquishment of over 300 unsold works from the gallery.
While Scher’s case revealed a litany of complaints rising from the corrupt intentions of her gallerist, the gallery incurred around $300,000 in printing and production costs and believed it was entitled to partial ownership of the works. The gallery argued that NYACAL § 12.01 did not apply because what the two parties had was not a consignment agreement. Under NYACAL § 12.0, a consignment agreement is created when the artist, already having title to an artwork she created, then delivers the piece of art to an art merchant for sale; here, the gallerist engaged the printer, paid the printer, and took delivery of the prints from the printer to be sold in the gallery. Therefore, the artist never actually delivered the art works to the gallery.
The court struck down this argument and asserted that Scher was the owner of the works, and according to their agreement, the gallery was acting as Scher’s agent. As Scher’s agent, they were prohibited from acting for their own self-interest or benefit. Essentially, the Court asserted that if the gallery wanted to be entitled to the works of art, they should have disclosed this, in plain terms, to Scher at the time of contracting.
Scher and Al-Hadid’s cases share a similar issue: Stendhal Gallery, like Marianne Boesky Gallery, maintained that because it financed and oversaw the fabrication of the works, in this case the silk-screen printing of Scher’s Maps collection, that it was entitled to the ownership of the unsold works.
The ruling in Art Works, Inc v. Diana Al-Hadid sets precedent in that ownership, regardless of whether an art merchant finances the creation of artwork, is undisputedly entitled to the artist, unless the merchant and artist explicitly contract for a provision stating otherwise. However, artists may still take extra precaution when entering a consignment agreement to prevent questions of ownership or debts upon the termination of the relationship. Galleries, in turn, must recognize that there is a certain amount of risk entailed with taking on a new artist, especially so when they advance funds for the creation of works, and they too can negotiate terms to an agreement to divide risk amongst parties.
Al-Hadid is now represented by Kasmin Gallery in New York (also Berggruen gallery in San Francisco and Morán Morán gallery in Los Angeles), where several of her pieces are on display. Upon meeting with her agent and another representative at Kasmin, it was clear that there are still galleries that remain proponents for artists’ rights. Both representatives spoke positively about the ruling and the precedent for future artists like Al-Hadid. Al-Hadid’s contract, as with all contracts at Kasmin Gallery, include a confidentiality clause. So while we are unable to know exactly how Al-Hadid now operates in terms of how creation pertains to ownership, one can assume that Al-Hadid has now learned from her case and that any agreement should contain terms outlining how a third party fabricator and any funding from the gallery for creation of future works effects ownership.
Scher, a veteran of the arts and design, unashamedly has taken the opposite route – a return to old-fashioned roots. She is now represented by two galleries, Jim Kempner Fine Art (NYC) and Bryce Wolkowitz Gallery (NYC), and has no formal contract in place with either. “If you cannot do business on a handshake with someone,” in this industry, Scher concedes, “then they are not worth doing business with at all.”
Does Scher have the right idea? Should artists, who are, for the most part, often by choice, not seasoned businessmen and women, oblige by the once traditional norms in hopes that good faith and governing law set forth to protect them prevail, or should they take matters into their own hands? And if it is the former, will the precedent set by Art Works, Inc v. Diana Al-Hadid, coupled with the current iteration of NYACAL, be enough to protect future artists from encountering lawsuit similar to Al-Hadid and Scher, or should there be further amendments to the NYACAL which would have made both the claims in Scher and Al-Hadid fail on their face? There are many more questions to be asked in this space and no one model fits all answer, save for the duties owed by parties to each other following good faith negotiations. If you want to learn more about this subject or ask your questions, take a look at the Center’s Artist-Dealer Relations Clinics.
About the Author: Nina Rice is a second-year student at New York Law School and member of the Center for Art Law intern class of 2022. With a passion for artist’s rights, Rice enjoys exploring the possible complexities of consignment agreements and laws that govern relationships in the art market.
New York Arts and Cultural Affairs Law §11.01(12): “On consignment” means that no title to, estate in, or right to possession of, the work of fine art or multiple that is superior to that of the consignor vests in the consignee, notwithstanding the consignee’s power or authority to transfer or convey all the right, title and interest of the consignor, in and to such work, to a third person. ↑
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