The Knockoff Economy (6 page)

“Five years ago the possibility of a group of dress manufacturers being powerful enough to draw fire on grounds of monopoly seemed so remote as to be funny,” wrote
Time.
The garment industry in the 1930’s was a “hodgepodge of feverishly busy small houses” competing intensely. “Dirty tricks” were ubiquitous. And aside from the prices,
Time’s
description of copying could have been written last week:

Among such tricks was the universal and highly developed practice of copying original styles. By the early Depression years it had gone so far that no exclusive model was sure to remain exclusive 24 hours; a dress exhibited in the morning at $60 would be duplicated at $25 before sunset and at lower prices later in the week. Sketching services made a business of it; delivery boys were bribed on their way to retailers.
³¹

The Guild’s purpose was to squelch this sort of behavior, though in its early years it concentrated solely on higher priced dresses (largely those wholesaling for more than $16.75—about $275 in 2012 dollars). The Filene’s suit
stemmed from the Guild’s decision to start clamping down on copying of cheaper garments as well. As
Time
noted, high and low priced garments were seen by many industry insiders as different markets, with different rules. “It was one thing to guard against copies in expensive lines,” wrote
Time,
“and another thing to give the same attention to lower-priced dresses, which are bought in greater quantities and sold to people who cared not at all whether they were copies or not. The retailers did not like the prospect of competing in these lines under Guild restrictions with the chain stores,” which were not party to the Guild system.

In a narrow sense, the Filene’s lawsuit against the Guild failed; a federal court held that the Guild’s actions were legal. But the Guild won the battle only to lose the war. The Federal Trade Commission, which is tasked with protecting consumers from unscrupulous sellers, took notice of the suit. Agreeing with Filene’s, the FTC decreed that the Guild was operating an illegal cartel and suppressing competition. In its defense, the Guild pointed to the difficulties of eradicating copying in the apparel industry. Its practices, the Guild’s lawyers argued, “were reasonable and necessary to protect the manufacturer, laborer, retailer, and consumer against the devastating evils growing from the pirating of original designs and had in fact benefited all four.”
³²

The Guild’s view was rejected by the Supreme Court. In its 1941 decision in
Fashion Originators’ Guild of America v. FTC,
³³
the Court acknowledged that rampant piracy might be a fact of life in the fashion world. However it did not give manufacturers a license to violate antitrust law and collude against competition. With that decision, the Guild was abruptly out of business.

The demise of the Guild did nothing, of course, to address the underlying issue of copying. But if the former Guild members could no longer organize a private cartel to stop copyists, perhaps they could have Congress do the work for them. Amending American law to protect fashion designs soon reemerged as a cause of some designers, just as it had been in the 1920s and early 1930s, before the Guild was organized. In the wake of the Supreme Court’s decision, Maurice Rentner, the former head of the Guild, devoted himself to lobbying Congress to extend copyright protection to fashion designs. Unless Congress acted, he warned, resurgent fashion piracy following the fall of the Guild would “write
finis
” to the dress industry. Rentner urged Congress to adopt the French system of protecting garment design.

Others in the industry were less sure. Leon Bendel Schmulen, of New York’s famous Henri Bendel department store, told the
New York Times
that design copying posed “no danger to the business” and was instead “a natural consequence of fashion.” “By the time a design of ours is copied in the cheaper dress lines,” said Bendel, “it’s probably time for it to go.”
³⁴

Leon Bendel and Maurice Rentner represent polar, and enduring, views in the long American debate over apparel and copying. Bendel believed that design copying was not only inevitable but perhaps even an essential part of the ecology of fashion. As he suggested, a design that was widely copied was a signal to start over and sell something new, and of course one made money by selling new things. This view has a distinguished pedigree in fashion; no less a figure than Coco Chanel claimed that “being copied is the ransom of success.”
³⁵
Maurice Rentner, on the other hand, saw copying as a serious threat that would eventually drive the industry under. Without protection, how could designers afford to keep designing? This view too had a distinguished pedigree, for it was the basis of the entire apparatus of copyright law in America (and much of the world) and it possessed an impeccable-seeming logic.

Nontheless, Bendel’s view prevailed. Rentner’s efforts to convince Congress to adopt French-style copyright protection for fashion went nowhere, despite his prediction that 500,000 American garment employees would lose their jobs due to piracy. And subsequent events belied Rentner’s doomsaying. In the decades after the fall of the Fashion Originator’s Guild, the US apparel industry boomed. Moreover, while in recent decades manufacturing has largely moved overseas in search of cheaper labor—leading to the decline of the manufacturing segment of New York’s Garment District—American designers are more numerous and more successful than ever. Since the fall of the Guild, in other words, the American apparel industry has survived and even thrived despite widespread—and entirely legal—copying.

Copying has remained an issue of enduring interest within the fashion industry, even as the Guild and its red cards are a distant memory. In particular, the meteoric rise of fast fashion retailing in recent years has led to the renewal of the arguments first pressed by Maurice Rentner in
the 1940s to amend American law to protect garment designs from copying.

These new calls for reform have arisen against a changed backdrop of American copyright law. In particular, over the past half-century, the strength and scope of restrictions on copying have markedly increased. Since Rentner’s unsuccessful efforts, Congress has expanded rules against copying in a wide variety of areas, ranging from buildings to boat hulls. Congress has also expanded the breadth of rights granted to copyright owners. And Congress has expanded the length of copyright protection. In 1976, and again in 1998, the term of protection was markedly increased.
³⁶
Adding force to these measures was a more powerful rhetoric of property rights, which increasingly characterized copyright (as well as trademark and patent) not as the regrettable-but-necessary government interventions into the free market they once were thought to be, but instead as a sacrosanct species of property that ought to be staunchly defended—not balanced against the value of wide public access to creative works, or other economic and social concerns.
³⁷

Against this backdrop, in 2006 the Design Piracy Prohibition Act (DPPA) was introduced in Congress. The DPPA was championed by the New York-based Council of Fashion Designers of America, and, in particular, by the group’s president, wrap-dress impresario Diane von Furstenburg. The group pursued the reliably counterproductive approach, at least as far as the US Congress is concerned, of appealing—as had Rentner himself decades earlier—to the example of France. Proponents argued that because France and many other nations afforded copyright protection to apparel designs, the United States ought to as well, lest it lose out in the global fashion competition.
³⁸

Despite a determined lobbying campaign, the DPPA went nowhere. A revised version, now titled the Innovative Design Protection and Piracy Prevention Act (IDPPPA), was introduced in 2009. Representative Bill Delahunt of Massachusetts introduced the bill with this dire—and familiar—prediction: “One of our most vibrant industries—the fashion industry—is currently at risk because the copyright laws of the United States, unlike virtually all other industrialized countries, fail to protect fashion designs.”
³⁹
Updating Maurice Rentner’s now six-decade-old prediction of catastrophic job losses (Rentner had predicted 500,000), Delahunt declared that 750,000 jobs were at stake due to design piracy, and that the proposed law
would, in his words, promote and protect the nation’s entrepreneurs “by ensuring a just and fair marketplace at home, and a level playing field abroad.”
^*

As this book goes to press in 2012, the IDPPPA has failed to come to a vote in Congress, and its future is uncertain. But if it passes, it will mark a sea change in American law. For over 200 years the United States has treated fashion design as an unprotected form of creativity, there for the taking by any entrepreneurial passerby.

As our brief history of American apparel suggests, knockoffs have long been ubiquitous in the fashion world, and whether you’re paging through Marie Claire’s
Splurge vs. Steal,
perusing the newest Zara “lookbook,” browsing the Web site of knockoff specialist Allen B. Schwartz (whose own biography states that he is “revered and applauded for the extraordinary job he does of bringing runway trends to the sales racks in record time”),
⁴⁰
or just wandering around the mall, the point is clear: knockoffs are everywhere. Some are more fairly called derivative works—that is, designs that are inspired by the original, but which add some new creative elements. Others are really “point by point” (that is, exact) copies. All are easy to find.

If the ordinary rules of copyright law were applied to fashion, nearly all knockoffs would be illegal, and the guilty copyist would face substantial fines and penalties—including, in some cases, the possibility of jail time. Indeed, the practice of copying within the garment industry is so widespread that “normalizing” fashion within the regular copyright system (combined with America’s lawsuit-friendly system and plentiful and entrepreneurial lawyers) would probably result in a staggering array of lawsuits, fines, and injunctions—which is why even strong proponents of amending American law acknowledge that fashion needs its own special and much more permissive rules.

Two other points are worth noting about knockoffs. First, not all copying involves an entire garment. In many cases only a feature of a design is copied, and that feature may become part of that season’s set of trends. Often these features are familiar, recycled elements that under no imaginable legal system would be protected: cap sleeves, kitten heels, peaked lapels, or an empire waist. But sometimes the feature is new—or newer—like the many mink, fox, rabbit, and raccoon stoles dyed in psychedelic colors that designers were showing for Fall 2011. Either way, it is the widespread copying of such features that often gives rise to (or evidences) a trend. Even the clichéd rise and fall of hemlines can be thought of this way.

This distinction between design feature and overall design is important, since many of the examples used in the debate over copying are really examples of overall designs copied more or less accurately. The Foley & Corinna/Forever 21 spat is a good example of this. But point-by-point copies like these, although they grab a lot of attention, are only a small part of the copying that goes on in the fashion industry. The relative amounts are hard to measure. But it is unquestionable that a large share of copying in the fashion industry involves design features, not the total design. The result is a range of garments that copy that feature in order to follow a trend, but which, unlike point-by-point copies, are easily recognized as different items.

Copying varies in scope but also in time. Some copying occurs in the same year or season that the original garment appears.
⁴¹
At times copying may even occur
before
the original arrives in stores
^*
. Other copying occurs with a pronounced lag, and indeed this kind of copying is so common it is hardly noticed. Think of how often a style from a decade or two ago reemerges, usually slightly tweaked, on the runways in Paris or New York.

Viewed from the perspective of creative industries such as the music or motion picture industries, the ubiquity of copying in fashion is more than surprising. In these industries, every type of copying that is widespread in the fashion world is condemned as illegal piracy, and combating piracy is a
principal concern. This is clear to anyone who has followed the music industry’s battle against online filesharing.

By contrast, the freedom to copy apparel designs—sometimes euphemistically referred to as “referencing” or “homage”—has long been taken for granted. Indeed, it is often accepted, and sometimes even celebrated, by a surprisingly large swath of the fashion world. Some designers are fatalistic: Alber Elbaz of Lanvin recently declared that “I don’t care if people copy me,” though he quickly added, alluding perhaps to the power of copying to inspire new creativity “well, I do care. For me, I create prototypes. They can copy yesterday but they can’t copy tomorrow.” Others view copying as a badge of honor. Tom Ford has said that “Nothing made me happier than to see something that I had done copied.”
⁴²
Prada CEO Patricio Bertelli was even blunter: “I would be more worried if my product
wasn’t
copied.”
⁴³

Not everyone agrees, of course. The fashion copying debate is often depicted as one that pits great artists (read: fashion press favorites) against sneaky pirates (read: Forever 21 and fly-by-night knockoff artists). But that’s not a fully accurate picture. Famed designers don’t just acquiesce in copying; they sometimes engage in it. In 2002, for example, Nicholas Ghesquiere, a heralded young designer for Balenciaga, admitted to copying point-by-point a vest originated some three decades earlier by a largely forgotten American designer named Kaisik Wong. As Cathy Horyn, the
New York Times
fashion critic, opined, this kind of incident was more commonplace than many realized: