Today’s guest post is by intellectual property lawyer and novelist Brad Frazer (@bfrazjd).
We have an original oil painting hanging over our fireplace in the basement. We commissioned it many years ago from a young local artist whose work we enjoyed. The painting is probably worth less today than when we bought it in the late 90s.
On the back of the painting is an envelope, taped there by the artist. Inside is a handwritten “certificate of authenticity” signed by the artist indicating that he in fact did paint the picture, a whimsical scene of a stylized living room that was meant to be hung, well, in a living room. That certificate is the only proof of provenance we have should that artist suddenly become famous.
If instead of actually committing oil to canvas, however, the artist had created the work purely and only in a digital form, he could not have attached his physical certificate of authenticity to the work. Thus, when he emailed me the JPEG or PNG of the image for me to presumably print, frame, and hang over my fireplace, all I would have to prove provenance is his email indicating that the attached was his original work of authorship. And I might not even have such an email!
So, what to do to establish provenance of wholly digital works of art? NFTs! These digital certificates of authenticity, minted and recorded in the blockchain, certainly have their utility in terms of establishing provenance, but as a copyright lawyer, I frankly stand all amazed at the hoopla surrounding non-fungible tokens.
Why? Well, whence does a work of art derive value? Provenance, yes, but more accurately, scarcity. It’s Econ 101 all over again. If there’s only one The Starry Night, never to be re-created again by Van Gogh, and the provenance is not in question, that work of art is worth tens of millions of dollars. If there were fifty or a hundred The Starry Nights, however, all identical to the original and all painted by Van Gogh, the value of that masterpiece would certainly decrease.
So now consider a wholly digital work of art, a work that may be infinitely and easily copied and re-created by everyone who sees it on the internet simply by right-clicking on the image and selecting “Save As.” Or “Print.” Or “Email.” Or “Publish to Facebook.” Again, and again and again. There is thus no inherent scarcity to wholly digital works of art.
And this is true even if the artist has minted an NFT to go along with it because all an NFT is is a digital form of provenance. Admittedly the unique, immutable non-fungible token itself may have value as a novelty and because there is only one, but I worry about the general public’s perception that the NFT somehow establishes the value and creates scarcity of the underlying work of art.
And so now enters our old friend copyright law. With or without an NFT, the only way an artist can stop the unlawful reproduction of a digital work of art is by using copyright law, as is true for any work authored in, say, the last 100 years. For today, U.S. copyright law does not recognize an NFT as that “thing” that will get you admission to federal court to sue for copyright infringement. Unless a digital artist has registered her copyrights in her portfolio with the United States Copyright Office, she has no legal remedies against illegal copying of her digital works, NFTs notwithstanding, and this means she has no real effective mechanism to create scarcity of her work by controlling the supply.
So until Congress rewrites 17 USC Section 411(a) or the U.S. Supreme Court revisits its recent Fourth Estate decision (holding that the plaintiff must have a copyright registration certificate in hand to maintain an infringement action in federal court), an NFT is not equivalent to a copyright registration certificate issued by the Copyright Office. Thus, cutting-edge digital artists are left with a legal remedy hundreds of years old to create the requisite scarcity to drive value in their digital works, even if the artist has minted an NFT for the work.
I guess I understand the novelty of NFTs, but at the intersection of economics and copyright law, I am flabbergasted at the extreme values currently associated with these blockchain curiosities when the underlying digital works of art gain no protection against copying through their existence.
Think of it this way: an investor paid $69 million for the NFT minted in connection with Beeple’s digital work of art Everyday: The First 5,000 Days, but unless and until Beeple obtains a copyright registration certificate on that work, someone could, for example, print 1,000 T-shirts with exact copies of 5,000 Days on them and sell them on Etsy with relative impunity. So, Beeple, if you’re reading this, have your lawyer register your copyrights in all of your digital works whether they have NFTs minted or not. This is the only way you can go to court, get an injunction against an infringer, and create scarcity in your digital works of art.
Brad Frazer is a partner at Boise, Idaho law firm Hawley Troxell where he practices internet and intellectual property law. He is a published novelist (http://www.diversionbooks.com/books/the-cure/) and a frequent speaker and writer on legal matters of interest to content creators. He may be reached at bfrazer@hawleytroxell.com.
I have two comments on this.
First, it should possible to stenograph into any digital image a non-editable link to a certificate of provenance or scarcity, whether that’s an NFT or something more traditional like a record of copyright. I’d love to know why digital artists aren’t doing that.
Second, it’s only in US copyright law that you have to register copyright. In European law, copyright is inherent in the creation of a work. You can prove copyright by mailing a sealed copy of your work to a trusted third party such as a lawyer (or a photograph of it’s visual art).
Hi Alex: In the US, copyright protection is granted to works upon creation as well, but registration is needed in the case of a lawsuit. More on that here: https://janefriedman.com/copyright-registration-dont-wait/
In the US, some believe that mailing a copy of your work to yourself is an acceptable way of proving copyright (“poor man’s copyright”), but this is a myth. I don’t know if the same is true in the UK, but I’d double-check.
Send a copy of your original creation by registered mail, return receipt to yourself. It establishes the date you created it. I heard that over 40 years ago. So that is no longer true? Bummer.
This offers no protection beyond what the law already affords you, and the work is protected under copyright without mailing it to yourself. If you want protection that actually matters, you need to register it.
The federal copyright office explains on its website, “The practice of sending a copy of your own work to yourself is sometimes called a ‘poor man’s copyright.’ There is no provision in the copyright law regarding any such type of protection, and it is not a substitute for registration.”
Alex (Lane) wrote, “…it’s only in US copyright law that you have to register copyright [to pursue a US-based copyright infringer for money damages & attorney fees].”
Some countries, including South Africa, Argentina, Mexico, Malaysia, Kenya, Jamaica, India, and Canada encourage their citizens to voluntarily register their copyright claims as it provides them with “prima facie” evidence of ownership and/or evidence of date of creation that can be useful in litigation (just like in the US!).
Alex (Lane) wrote, “In European law, copyright is inherent in the creation of a work.
Likewise, copyright creation is “inherent” (i.e., automatic) in the US and all Berne Convention members (170+) countries upon creation of a work.
Alex wrote, “You can prove copyright by mailing a sealed copy of your work to a trusted third party such as a lawyer (or a photograph of it’s visual art).”
As Jane Friedman previously wrote, the practice of mailing your creative work in a self-addressed stamp envelope (SASE) is better known in the US as the “Poor Man’s Copyright” – It might make you feel safe, but is NOT a substitute for official registration with the US Copyright Office (USCO). From the USCO:
“Please be advised that there is no provision in the copyright law or the practices of the Copyright Office regarding any type of protection known as the “poor man’s copyright.” The mere act of placing a copy in the mail addressed to oneself does not secure statutory copyright protection for the work, nor will it serve as a substitute for registration of a claim to copyright in this Office in terms of legal and evidentiary value.” See https://www.copyright.gov/help/faq/faq-infringement.html
I, personally, would NOT feel comfortable mailing a copy of my creative work in a SASE “to a trusted third-party such as a lawyer” for the following reasons:
The date stamped on your SASE is the date you “mailed” the creative work, and NOT the date you actually created the work.
What happens if your trusted third-party receives your SASE but the envelope has been mishandled/damaged (i.e., there’s a small tear — that could suggest to opposing counsel that an attempt was made to open the SASE and modify its contents)? What happens if your SASE gets lost in the mail? What happens if the SASE stamped date is smudged and difficult to read or, because of years in your possession, the date/address has faded and is not readable? What happens if you’ve inadvertently missed placed your SASE? What then? How do you convincingly prove your creation?
In addition, these SASE deliveries pose tampering issue problems: An envelope can be (steamed) open and/or the stamped date changed (with some practice, you can change the date-stamped number “6” into an “8”?). All these SASE issues will be exploited by the infringer’s attorney to create doubt on your credibility.
In 2016, I mailed myself an empty SASE by folding the seal into the letter. When needed, I can misappropriate any person’s poem, script, photographs (of artworks), songs, etc., place it into the unsealed envelop, and lick it shut, and use the five-year-old US Post stamp date as my proof of (fraudulent/unlawful) creation!
Another problem: If you mail your SASE to your attorney, s/he will have to open it in the office to verify that the enclosed document/s is your creative work that’s been infringed and that you have a bone-fide legal claim. Will your attorney have to be a “witness” in your copyright infringement dispute, and will that not create a conflict problem?
In the US and elsewhere, when you mail a creative work in a SASE, all you’re really proving is the country’s mail service can deliver a letter/package back to you.
Americans, on the other hand, help PROVE their copyright claims to a US federal judge, the infringer, publishers, and others by “timely” registering their creative works with the USCO, either before publication or within five-years of first-publication (if creatives register more quickly, before the infringement or within three-months of first-publication, they can pursue enhanced money damages up to US$150,000 and attorney fees). This timely action STATUTORILY grants creatives with “presumptive legal proof” (prima facie evidence) that they have a valid copyright, and the facts stated in their copyright registration application (who’s the copyright author, copyright claimant, year of creation, year of first-publication, etc.) will be deemed valid unless disproved by the court or others.
When registering works with the USCO, Americans (and other country creatives) must CERTIFY to their best ability that their registration application is correct. Creatives, who knowingly lie or misrepresent a material fact in their copyright registration application and deposit (the work being registered), are subject up to a US$2,500 CRIMINAL FINE. See 17 USC § 410 (Registration of claim and issuance of certificate) & 17 USC 506(e) (False Representation [Criminal Offenses]).
The US copyright registration system is very much a vetting process to help authenticate an author’s copyright validity. It’s not necessarily about having a RAW or original file or book manuscript or a SASE that proves your copyright creation – a US federal judge MUST see your ISSUED copyright “Certificate of Registration” that the USCO will mail you. Your Certificate will include your “effective date of registration,” the OFFICIAL US government date stamp of your creative authorship claims.
So when an infringer challenges my copyright authorship & ownership claims, I simply show them my issued Certificate, and that shuts them up – that’s my government-issued evidence vs. waving a precarious SASE in their face!
But wait, there’s more!
If your writing authorships are being infringed in the UK, then they’re also likely being (or will be) infringed in the US and/or other countries.
If your creative work is being infringed in the US, you and other Berne members are EXEMPT from having to register your copyright claims with the USCO to pursue the US-based infringer. However, before proceeding with your lawsuit, you’ll have to first prove you have a valid copyright & ownership claim, and I’m not sure if your SASE will be sufficient evidence for a US judge, because of tampering and other issues I’ve noted.
If you’re able to get pass that obstacle, you, Americans, and other Berne creatives will only be permitted to pursue “actual damages” (typically the missed licensing fee, and those fees tend to be LOW) and the disgorgement of profits the infringer made (if any!), and you’ll be responsible for your US attorney fees & legal costs via trial or out of court settlement, as the cost to litigate US copyright disputes is EXORBITANT! All too often, it’s UNECONOMICAL for US, UK and Berne creatives to pursue US-based copyright infringements, unless they’ve timely registered their works with the USCO.
This short law article explains why international creatives, and especially those who are licensing, selling, distributing, sharing their works in the US, really need to timely register their copyrights with the USCO (just replace the word “companies” with “writers, painters, illustrators, photographers, filmmakers, etc.”: https://donahue.com/resources/publications/copyrights-registered-u-s/
In addition, I have to believe that a Certificate of Registration issued by the US Copyright Office could be used to help international creatives prove their copyright ownership claims in their Berne (UK) country vs. relying on a SASE. I also have to believe that a court outside the United States would respect & honor legal documents from the US Copyright Office, an official US government entity.
Timely registering your copyrights with the USCO can provide both Americans & international creatives with substantial legal dividends!
Its it good to get a legal perspective the status of NFTs. From a fine artist perspective this is interesting. For me, it is now too compelling for me to not create a digital replica of all my works. There are a few reasons. 1. I can issue original digital pieces of the works. 2. I can create a market place for my work that is secure, and it cuts out the high commission gallerists. 3. I can access a global audience now without concern about physical delivery of works and logistics. 4. I am free to create digital variations of these.
To your point about Copyright. As the creator and issuer of art work as an NFT, being the source of origin would carry more value than those who would copy such and mint. A serious art collector could seek provinence this way, and directly from the artist. For the artist who is copied it means more exposure where there was none before.