By Mark Peroff
Copyright trolls — registering copyrights on a large universe of fabric designs and then pouncing on unsuspecting manufacturers and retailers — are now an unpleasantly hot industry trend. They operate with the intent of making money in litigation by aggressively and opportunistically filing complaints against legitimate companies that are unaware any copyrights exist – banking on the fact that their targets would rather pay and settle than fight a costly lawsuit. Prominent retailers and textile manufacturers have been targets of this practice.
These copyright troll attacks are difficult to defend against — they proceed based on a clear strategy. The fabric patterns, prints and designs these entities own copyrights to may not even be products they are producing or licensing for paid distribution. Yet, they amass huge “libraries” or “stockpiles” of copyrighted fabrics and then send out teams of “shoppers” to scour stores for identical or substantially similar fabrics. Given the sheer volume of copyrights they own, they will likely find something, especially since even basic fabric prints like floral, paisley, animal or geometric can be subject to a copyright infringement lawsuit.
Once their “shoppers” identify potentially infringing fabrics, copyright trolls retain law firms to send out hundreds of “cease and desist” letters and to file lawsuits. Regardless of whether the textile manufacturer has valid defenses to assert, most companies decide it’s simplest and least expensive to settle.
It would take a huge investment in time and money to individually and legally vet hundreds, sometimes thousands of fabrics, especially given the constant pace of change and turnover. Attempting to do so would be not just a nuisance but completely impractical.
Copyright infringement claims may seem inevitable — with the only guarantee of protection being to only produce and sell solid fabrics. That, of course, is ridiculous and completely unrealistic. Thankfully there are much more reasonable steps textile manufacturers can take to avoid such claims altogether or, if it occurs, mitigate damage during litigation.
The first step is to ensure the designers are well educated on the importance of creating prints that are substantively different, and why copying work even inadvertently can lead to legal trouble. To avoid infringement claims, the possibility of one always needs to be top of mind. All it takes is for a designer to see a cool fabric somewhere once to be influenced by it and not realize later that their burst of creativity was more imitation than inspiration.
This is particularly tricky when the fabric designs involved follow or incorporate a fashion trend. A designer’s interpretation of that trend into their work must be different enough that it can’t be considered copying.
Collaboration between manufacturers and retailers is also important. Manufacturers want to be able to assure their customers of the originality of their design and, when the design comes from the retailer, the manufacturer has the right to some assurance about the source. The parties may want to include indemnification and hold harmless clauses, clearly stating whose responsibility it will be to defend copyright lawsuits and under which circumstances.
At the end of the day, legitimate textile manufacturers want to supply great products that consumers enjoy wearing and bringing into their homes. Instances of true copyright infringement in the traditional sense are actually the exception.
A copyright troll’s “business” capitalizes on the fact that, for most companies, it makes more sense to pay than to fight. That’s why it is so important that companies prepare ahead of time. Copyright trolls are lurking, and once they strike, it could be a costly proposition.
Editor’s Note: Attorney Mark Peroff, managing partner, Peroff Saunders, P.C., has represented clients in the US and globally on a range of intellectual property matters, including copyright infringement lawsuits with copyright trolls. He can be reached at mark.peroff@peroffsaunders.com, or (646) 898-2030.
Posted October 19, 2019
