The law, culture, and economics of fashion.

• Author: Hemphill, C. Scott

INTRODUCTION I. WHAT IS FASHION? A. Status B. Zeitgeist C. Copies Versus Trends D. Why Promote Innovation in Fashion? II. A MODEL OF TREND ADOPTION AND PRODUCTION A. Differentiation and Flocking B. Trend Adoption C. Trend Production III. HOW UNREGULATED COPYING THREATENS INNOVATION A. Fast-Fashion Copyists B. The Threat to Innovation 1. Harmful copying 2. Distorting innovation C. Is Piracy Really Beneficial? IV. TAILORED PROTECTION FOR ORIGINAL DESIGNS A. The Scope of the Right B. Considering Objections CONCLUSION APPENDIX INDEX OF FIGURES AND TABLES Table 1. Selected U.S. Litigation Against Forever 21, 2007-2008 Table 2. Selected European Litigation, 2005-2008 Figure 1. Foley & Corinna and Forever 21 Figure 2. Jonathan Saunders and Forever 21 Figure 3. Yves Saint Laurent and Ralph Lauren INTRODUCTION

Fashion is one of the world's most important creative industries. It is the major output of a global business with annual U.S. sales of more than $200 billion--larger than those of books, movies, and music combined. (1) Everyone wears clothing and inevitably participates in fashion to some degree. Fashion is also a subject of periodically rediscovered fascination in virtually all the social sciences and the humanities. (2) It has provided economic thought with a canonical example in theorizing about consumption and conformity. (3) Social thinkers have long treated fashion as a window upon social class and social change. (4) Cultural theorists have focused on fashion to reflect on symbolic meaning and social ideals. (5) Fashion has also been seen to embody representative characteristics of modernity, and even of culture itself. (6)

Indeed, it is hard to imagine a locus of social life--whether in the arts, the sciences, politics, academia, entertainment, business, or even law or morality--that does not exhibit fashion in some way. (7) People flock to ideas, styles, methods, and practices that seem new and exciting, and then eventually the intensity of that collective fascination subsides, when the newer and hence more exciting emerge on the scene. Participants of social practices that value innovation are driven to partake of what is "original," "cutting edge," "fresh," "leading," or "hot." But with time, those qualities are attributed to others, and another trend takes shape. This is fashion. The desire to be "in fashion"--most visibly manifested in the practice of dress--captures a significant aspect of social life, characterized by both the pull of continuity with others and the push of innovation toward the new.

In the legal realm, this social dynamic of innovation and continuity is most directly engaged by the law of intellectual property. At this moment, fashion itself has the attention of federal policymakers, as Congress considers whether to provide copyright protection for fashion design, (8) a debate that is sure to continue in the face of fashion designers' many complaints of harm by design copyists. (9) Despite being the core of fashion and legally protected in Europe, fashion design lacks protection against copying under U.S. intellectual property law. (10) Thus it has seemed sensible to posit that fashion design is relevantly different from literature, music, and art, where legal protection from copying is thought to be necessary to provide producers an incentive to create. (11) Indeed, some commentators even suggest that perhaps fashion design is so different from other arts that its vitality, or even survival, paradoxically depends on the existence of the opposite kind of regime--a culture of tolerated rampant copying. (12)

This Article enters the debate about intellectual property protection and fashion design (13)--a debate in which the fashion industry finds itself divided (14)--and argues for a limited right against design copying. We set the legal policy debate within a reflection on the cultural dynamics of innovation as a social practice. Fashion in the realm of dress is a version of a ubiquitous phenomenon, the ebb and flow of trends wherein the new ineluctably becomes old and then leads into the new. Fashion is commonly thought to express individuality, and simultaneously to exemplify conformity. The dynamics of fashion lend insight into the dynamics of innovation more broadly.

Our motivation here is threefold. First, as the most immediate visible marker of self-presentation, fashion communicates meanings that have individual and social significance. Innovation in fashion creates vocabularies for self-expression that relate individuals to social worlds. As with other creative goods, intellectual property law plays a role in shaping the quantity and the direction of innovation produced by the fashion industry and made available for consumption by people who wear clothing--that is, everyone--a group larger than those who consume art, music, or books. Second, the fashion industry has huge economic importance. (15) Getting the economics of this industry right is an important challenge that must inform an inquiry into its regulation by intellectual property law. Third, the debate over legal protection for fashion design connects to a larger debate about how much intellectual property protection we want to have. (16)

The question of legal protection for fashion design poses the central question of intellectual property: the optimal balance between, on the one hand, providing an incentive to create new works, and on the other hand, promoting the two goals of making existing works available to consumers and making material available for use by subsequent innovators. We treat fashion as a laboratory to ask this question anew. The fashion trend is a particularly vivid manifestation of a general innovation pattern wherein those engaged in innovation continually seek after the new and different while, at the same time, converging with others on similar ideas. Fashion conspicuously exhibits the challenge of providing incentives for individuals to innovate while preserving the benefits to innovation of moving in a direction with others.

This Article offers a new model of consumer and producer behavior derived from cultural analysis in an area where consumptive choices are also expressive. In fashion we observe simultaneously the participation in collective trends and the expression of individuality. Consumers have a taste for trends--that is, for goods that enable them to move in step with other people. But even in fulfilling that taste, they desire goods that differentiate them from other individuals. Fashion goods tend to share a trend component, and also to have features that differentiate them from other goods within the trend. Consumption and production of fashion must be understood with respect to both the trend features and the differentiating features. Formalizing these cultural observations, we call these two coexisting tastes "flocking" and "differentiation." Fashion puts into relief people's tendency to flock while also differentiating from each other.

Individual differentiation within flocking is our account of fashion behavior. But we can observe versions of this dynamic too in other areas of innovation, for example, the production and consumption of books, music, film, and other arts. Where innovation is a site of both self-expression and social expression, we can see producers and consumers of creative goods flocking to themes in common, but differentiating themselves within that flocking activity.

The model makes visible an important analytic distinction that is useful for thinking about creative goods--the distinction between close copying on one hand and participation in common trends on the other hand. Design copying must be distinguished from other forms of relation between two designs, which may go by any number of names including inspiration, adaptation, homage, referencing, or remixing. Our analysis resists elision of close copies and myriad other activities that produce, enable, and comprise trends. Goods that are part of the same trend are not necessarily close copies or substitutes. Rather, they may be efforts to meet the need of consumers for individual differentiation within flocking. The well-known fact that "borrowing" is common in fashion, (17) and might be valuable to fashion innovation, does not itself provide support for the permissibility of close copying in fashion design.

Our theory leads us to favor a legal protection against close copying of fashion designs. The proliferation of close copies of a design is not innovation--it serves flocking but not differentiation. It is importantly distinct from the proliferation of on-trend designs that share common elements, inspirations, or references but are nevertheless saliently different from each other. With respect to close copies, there is no reason to reject the standard justification for intellectual property, that permissive copying reduces incentives to create. But this effect must be distinguished from the effects of other trend-joining activities, which enable differentiation within flocking. They foster and constitute innovation in ways that close copying does not. Thus we argue in favor of a legal right that would protect original fashion designs from close copies.

Some readers will no doubt bristle at the implication that Prada, say, ought to enjoy better protection for its wares. That reaction misunderstands the project. Because the current legal regime denies design protection while providing trademark and trade dress protection, the primary threat to innovation currently is not to the major fashion conglomerates. As we explain, these luxury firms are already well protected by the existing trademark and trade dress legal regime, brand investments, and the relatively small overlap between markets for the original and for the copy. The main threat posed by copyists is to innovation by smaller, less established, independent designers who are less protected along all of these dimensions. Affording...