U.S. GOVERNMENT PRINTING OFFICE

WASHINGTON : 

For sale by the Superintendent of Documents, U.S. Government Printing Office

Internet: bookstore.gpo.gov Phone: toll free (866) 512–1800; DC area (202) 512–1800

Fax: (202) 512–2104 Mail: Stop IDCC, Washington, DC 20402–0001

67–397 PDF 2011

INNOVATIVE DESIGN PROTECTION AND 

PIRACY PREVENTION ACT 

HEARING 

BEFORE THE

SUBCOMMITTEE ON 

INTELLECTUAL PROPERTY, 

COMPETITION, AND THE INTERNET 

OF THE

COMMITTEE ON THE JUDICIARY 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED TWELFTH CONGRESS 

FIRST SESSION 

ON

H.R. 2511 

JULY 15, 2011 

Serial No. 112–46 

Printed for the use of the Committee on the Judiciary 

( 

Available via the World Wide Web: http://judiciary.house.gov 

(II) 

COMMITTEE ON THE JUDICIARY 

LAMAR SMITH, Texas, Chairman 

F. JAMES SENSENBRENNER, JR., 

Wisconsin 

HOWARD COBLE, North Carolina 

ELTON GALLEGLY, California 

BOB GOODLATTE, Virginia 

DANIEL E. LUNGREN, California 

STEVE CHABOT, Ohio 

DARRELL E. ISSA, California 

MIKE PENCE, Indiana 

J. RANDY FORBES, Virginia 

STEVE KING, Iowa 

TRENT FRANKS, Arizona 

LOUIE GOHMERT, Texas 

JIM JORDAN, Ohio 

TED POE, Texas 

JASON CHAFFETZ, Utah 

TIM GRIFFIN, Arkansas 

TOM MARINO, Pennsylvania 

TREY GOWDY, South Carolina 

DENNIS ROSS, Florida 

SANDY ADAMS, Florida 

BEN QUAYLE, Arizona 

[Vacant] 

JOHN CONYERS, JR., Michigan 

HOWARD L. BERMAN, California 

JERROLD NADLER, New York 

ROBERT C. ‘‘BOBBY’’ SCOTT, Virginia 

MELVIN L. WATT, North Carolina 

ZOE LOFGREN, California 

SHEILA JACKSON LEE, Texas 

MAXINE WATERS, California 

STEVE COHEN, Tennessee 

HENRY C. ‘‘HANK’’ JOHNSON, JR., 

Georgia 

PEDRO R. PIERLUISI, Puerto Rico 

MIKE QUIGLEY, Illinois 

JUDY CHU, California 

TED DEUTCH, Florida 

LINDA T. SA ́ NCHEZ, California 

DEBBIE WASSERMAN SCHULTZ, Florida 

SEAN MCLAUGHLIN, Majority Chief of Staff and General Counsel 

PERRY APELBAUM, Minority Staff Director and Chief Counsel 

SUBCOMMITTEE ON INTELLECTUAL PROPERTY, COMPETITION, AND THE INTERNET

BOB GOODLATTE, Virginia, Chairman 

BEN QUAYLE, Arizona, Vice-Chairman 

F. JAMES SENSENBRENNER, JR., 

Wisconsin 

HOWARD COBLE, North Carolina 

STEVE CHABOT, Ohio 

DARRELL E. ISSA, California 

MIKE PENCE, Indiana 

JIM JORDAN, Ohio 

TED POE, Texas 

JASON CHAFFETZ, Utah 

TIM GRIFFIN, Arkansas 

TOM MARINO, Pennsylvania 

SANDY ADAMS, Florida 

[Vacant] 

MELVIN L. WATT, North Carolina 

JOHN CONYERS, JR., Michigan 

HOWARD L. BERMAN, California 

JUDY CHU, California 

TED DEUTCH, Florida 

LINDA T. SA ́ NCHEZ, California 

JERROLD NADLER, New York 

ZOE LOFGREN, California 

SHEILA JACKSON LEE, Texas 

MAXINE WATERS, California 

DEBBIE WASSERMAN SCHULTZ, Florida 

BLAINE MERRITT, Chief Counsel 

STEPHANIE MOORE, Minority Counsel 

(III) 

C O N T E N T S 

JULY 15, 2011 

Page 

THE BILL 

H.R. 2511, the ‘‘Innovative Design Protection and Piracy Prevention Act’’ ........ 133 

WITNESSES 

Lazaro Hernandez, Designer and Co-Founder, Proenza Schouler 

Oral Testimony ..................................................................................................... 3 

Prepared Statement ............................................................................................. 5 

Jeannie Suk, Professor of Law, Harvard Law School 

Oral Testimony ..................................................................................................... 13 

Prepared Statement ............................................................................................. 15 

Christopher Sprigman, Professor of Law, University of Virginia School of 

Law 

Oral Testimony ..................................................................................................... 74 

Prepared Statement ............................................................................................. 77 

Kurt Courtney, Manager, Government Relations, American Apparel & Footwear Association 

Oral Testimony ..................................................................................................... 91 

Prepared Statement ............................................................................................. 92 

LETTERS, STATEMENTS, ETC., SUBMITTED FOR THE HEARING 

Prepared Statement of the Honorable Bob Goodlatte, a Representative in 

Congress from the State of Virginia, and Chairman, Subcommittee on Intellectual Property, Competition, and the Internet ............................................... 1 

Prepared Statement of the Honorable Melvin L. Watt, a Representative in 

Congress from the State of North Carolina, and Ranking Member, Subcommittee on Intellectual Property, Competition, and the Internet ............... 10 

APPENDIX 

MATERIAL SUBMITTED FOR THE HEARING RECORD

Response to Post-Hearing Questions from Lazaro Hernandez, Designer and 

Co-Founder, Proenza Schouler ............................................................................ 102 

Response to Post-Hearing Questions from Jeannie Suk, Professor of Law, 

Harvard Law School ............................................................................................ 105 

Response to Post-Hearing Questions from Christopher Sprigman, Professor 

of Law, University of Virginia School of Law .................................................... 116 

Response to Post-Hearing Questions from Kurt Courtney, Manager, Government Relations, American Apparel & Footwear Association ............................ 125 

Letter from Stephanie Lester, Vice President, International Trade, Retail 

Industry Leaders Association .............................................................................. 130 

(1) 

INNOVATIVE DESIGN PROTECTION AND 

PIRACY PREVENTION ACT 

FRIDAY, JULY 15, 2011 

HOUSE OF REPRESENTATIVES,

SUBCOMMITTEE ON INTELLECTUAL PROPERTY,

COMPETITION, AND THE INTERNET, 

COMMITTEE ON THE JUDICIARY, 

Washington, DC. 

The Subcommittee met, pursuant to call, at 10:08 a.m., in room 

2141, Rayburn House Office Building, the Honorable Bob Goodlatte 

(Chairman of the Subcommittee) presiding. 

Present: Representatives Goodlatte, Quayle, Coble, Chabot, 

Marino, Watt, Conyers, Chu, Lofgren, and Jackson Lee. 

Staff Present: (Majority) Blaine Merritt, Subcommittee Chief 

Counsel; Olivia Lee, Clerk; and Stephanie Moore, Minority Subcommittee Chief Counsel. 

Mr. GOODLATTE. Good morning. 

The Subcommittee on Intellectual Property, Competition, and the 

Internet will come to order. I want to welcome our witnesses for 

this hearing on the ‘‘Innovative Design Protection and Piracy Prevention Act.’’ 

I am going to submit my opening statement for the record and 

I believe that the Ranking Member, Mr. Watt, who I believe will 

be here shortly, and the Ranking Member of the full Committee, 

Mr. Conyers, have indicated an interest in doing the same in order 

to get to our witnesses as quickly as possible. 

Our reason for doing that is because we are expecting votes 

around 11. Once they come, they are going to be very lengthy, and 

we may have to conclude before then. We will gauge that at 11. 

[The prepared statement of Mr. Goodlatte follows:] 

Prepared Statement of the Honorable Bob Goodlatte, a Representative in Congress 

from the State of Virginia, and Chairman, Subcommittee on Intellectual Property, 

Competition, and the Internet 

Article I, section 8, of the Constitution lays the framework for our nation’s copyright laws. It grants Congress the power to award inventors and creators for limited 

amounts of time exclusive rights to their inventions and works. The Founding Fathers realized that such an incentive was crucial to ensure that America would become the world’s leader in innovation and creativity. This incentive is still necessary 

to maintain America’s position as the world leader in innovation. 

Most industrialized nations provide legal protection for fashion designs. However, 

in the United States, the world’s leader in innovation and creativity, fashion designs 

are not protected by traditional intellectual property regimes. Copyrights are not 

granted to apparel because articles of clothing, which are both creative and functional, are considered useful articles, as opposed to works of art. Design patents are 

2 

intended to protect ornamental designs, but clothing rarely meets the criteria of patentability. Trademarks only protect brand names and logos, not the clothing itself. 

And the Supreme Court has refused to extend trade dress protection to apparel designs. Thus, a thief violates Federal law when he steals a creator’s design, reproduces and sells that article of clothing, and attaches a fake label to the garment 

for marketing purposes. 

But it is perfectly legal for that same thief to steal the design, reproduce the article of clothing, and sell it, provided he does not attach a fake label to the finished 

product. This loophole allows pirates to cash in on the sweat equity of others and 

prevents designers in our country from reaping a fair return on their creative investments. 

The production lifecycle for fashion designs is very short. Once a design achieves 

popularity through a fashion show or other event, a designer usually has a limited 

number of months to produce and market that original design. Further complicating 

this short-term cycle is the reality that once a design is made public, pirates can 

immediately offer identical knockoffs on the Internet for distribution. 

Again, under current law, this theft is legal unless the thief reproduces a label 

or trademark. And because these knockoffs are usually of such poor quality, they 

damage the designer’s reputation as well. Common sense dictates that we should 

inhibit this activity by protecting original fashion works. 

Our undertaking is similar to action taken by Congress in 1998 when we wrote 

Chapter 13 of the Copyright Act, which offers protection for vessel hull designs. The 

‘‘Innovative Design Protection and Piracy Prevention Act’’ amends this statutory 

template to include protections for fashion designs. Because the production lifecycle 

for fashion designs is very short, this legislation similarly provides a shorter period 

of protection of three years that suits the industry. 

The bill enjoys support among those in the fashion and apparel industries. While 

concerns have been expressed about the scope of previous versions of this legislation, my office has engaged in discussions through the years with interested parties 

to ensure that the bill does not prohibit designs that are simply inspired by other 

designs; rather, the legislation only targets those designs that are ‘‘substantially 

identical’’ to a protected design. Other provisions, including a ‘‘home-sewing’’ exception and a requirement that a designer alleging infringement plead with particularity, ensure that the bill does not encourage harassing or litigious behavior. 

H.R. 2511 is identical to legislation reported by the Senate Judiciary Committee 

last December. Between this event and the growing coalition of stakeholders coalescing around our bill, I am optimistic that we can enact fashion piracy reform in 

the 112th Congress. 

I look forward to hearing from our witnesses, and I now recognize the Ranking 

Member from North Carolina for his opening statement. 

Mr. GOODLATTE. In the meantime, let me go ahead and welcome 

our witnesses and introduce them. We have a very distinguished 

panel of witnesses today. 

Each of the witnesses’ written statements will be entered into 

the record in its entirety. I ask that each witness summarize his 

or her testimony in 5 minutes or less. 

To help you stay within that time, there is a timing light on your 

table. When the light switches from green to yellow, you will have 

1 minute to conclude your testimony. When the light turns red, it 

signals that your 5 minutes have expired. 

And it is the custom of this Committee to swear in our witnesses. 

So I would ask that the witnesses rise. 

[Witnesses sworn.] 

Mr. GOODLATTE. Thank you very much. Please be seated. 

Our first witness is Lazaro Hernandez, who co-founded Proenza 

Schouler, a New York-based modern luxury women’s wear and accessory label, in 2002. The company has won a number of industry 

honors from the Council of Fashion Designers of America, including 

the 2003 Perry Ellis Award for New Talent, the 2004 Vogue FashVerDate Aug 31 2005 12:10 Sep 01, 2011 Jkt 000000 PO 00000 Frm 00006 Fmt 6633 Sfmt 6601 H:\WORK\IP\071511\67397.000 HJUD1 PsN: 67397
3 

ion Fund Award, and the 2007 and 2011 Women’s Wear Designer 

of the Year Award. 

Proenza Schouler is sold in more than 100 outlets worldwide and 

has collaborated with Target and J Brand Jeans, among other retailers. The company has also developed working relationships with 

a number of celebrities such as Kristen Stewart, Sarah Jessica 

Parker, Gwyneth Paltrow, Kirsten Dunst, and Julianne Moore. 

Originally a pre-med student from South Florida, Mr. Hernandez 

dropped out of the University of Miami and enrolled in the Parsons 

School of Design, from which he graduated 9 years ago. 

Our next witness is Jeannie Suk, professor of law at Harvard 

Law School. Professor Suk specializes in criminal law and family 

law, while also teaching art and entertainment law. Prior to her 

current duties, Professor Suk served as a law clerk for Judge Harry 

Edwards of the U.S. Court of Appeals for the D.C. Circuit and for 

Justice David Souter on the United States Supreme Court. She 

also worked as an Assistant District Attorney in Manhattan and 

was a fellow at the New York University School of Law. 

Professor Suk studied ballet at the School of American Ballet and 

piano at the Juilliard School before earning her B.A. From Yale, a 

Doctor of Philosophy from Oxford as a Marshall Scholar, and her 

law degree from Harvard. 

Our next witness is Christopher Sprigman, professor of law at 

the University of Virginia School of Law. He teaches intellectual 

property, antitrust, competition policy, and comparative constitutional law. Prior to joining the Virginia faculty in 2005, Professor 

Sprigman clerked for Judge Steven Reinhardt of the Ninth Circuit 

Court of Appeals and for Justice Lawrence Ackerman of the Constitutional Court of South Africa. He also taught law in Johannesburg, worked in the Antitrust Division of the U.S. Department of 

Justice, practiced law in Washington, and served as a residential 

fellow at the Center for Internet and Society at Stanford Law 

School. Professor Sprigman earned his B.A. From the University of 

Pennsylvania and his law degree from Chicago. 

Our final witness is Kurt Courtney, manager of government relations at the American Apparel & Footwear Association since 2007. 

In that capacity, he handles a wide variety of issues affecting the 

industry. That includes intellectual property, health care, taxes, 

ports, and government contracts. 

Before joining AAFA, Mr. Courtney spent 5 years on Capitol Hill 

working for Representatives Zack Wamp, Buck McKeon, and Ileana 

Ros-Lehtinen. A native of Los Angeles, Mr. Courtney graduated 

from the George Washington University in 2000 with a Bachelor of 

Arts Degree in International Affairs. 

I want to welcome all of you. 

Mr. Hernandez, we will begin with you. 

TESTIMONY OF LAZARO HERNANDEZ, DESIGNER AND 

COFOUNDER, PROENZA SCHOULER 

Mr. HERNANDEZ. Hello. Good morning, Chairman Goodlatte, 

Members of the Subcommittee. 

I am pleased to be here today to testify in support of H.R. 2511, 

or the ID3PA, on behalf of the Council of Fashion Designers of 

America. The CFDA is the leading trade organization representing 

4 

the American fashion industry. Over 85 percent of its members are 

small businesses that are creating jobs across the country, as fashion has grown to a $340 billion industry in the United States. 

My design firm, Proenza Schouler, began as a senior project simply at Parsons School of Design. In 1998, I met my design partner, 

Jack McCollough, who is here today. In our senior year at Parsons, 

we designed our first collection. And the entire collection was, remarkably, bought by Barney’s New York. As a result, at the age 

of 23, we launched our independent label, Proenza Schouler, which 

is named after our mother’s maiden names. 

I would like to thank the Committee for taking up the important 

issue of fashion piracy in this legislation. The fashion business is 

already a tough business, and it is getting tougher because of piracy. It takes tens of thousands of dollars to start a business and 

even more to sustain it. Just one of our collections—and we 

produce four collections a year—cost about $3.8 million. The cost 

of a typical show is approximately $320,000. So you can see a significant amount of money has been spent before a designer has received their first order. 

As designers, we expect many challenges. And we can handle 

most of them. However, we are helpless against copyists who prey 

on our ideas. Established or undiscovered, all designers have been 

touched by fashion design piracy. Fashion design is intellectual 

property that deserves protection. 

Fashion is different from basic apparel. Our designs are born in 

our imaginations. We create something from nothing at all. But by 

far, the majority of apparel is based on garments already in the 

public domain. Nothing about this proposed legislation will change 

that. Nobody will ever be able to claim ownership of a T-shirt or 

something as simple as a pencil skirt. 

When designers produce basic garments that complement their 

original designs in their collection, we know the difference between 

that and what is new. And so do the design pirates. This bill is intended to protect only those designs that are truly original. 

Our PS 1 satchel has been knocked off repeatedly. We have attempted to assure our rights and fight this piracy, but without success, because, unfortunately, it is currently legal under U.S. law to 

pirate a design that happens to be the key to our business. Every 

other developed country other than China has a law on the books 

to protect fashion, except the U.S. As a result, the U.S. has become 

a haven for copyists who steal designers’ ideas and sell them as 

their own with no fear of consequences. It has also become the 

weak link of international IP protection and the first if not only 

market for Chinese exporters of pirated designs. This is completely 

unacceptable. 

The problem is worsening with new technologies. Today, digital 

images from runway shows in New York or red carpet in Hollywood can be uploaded to the Internet within minutes, viewed at a 

factory in China, and be copied and offered for sale online within 

days, which is months before the designer is able to deliver the 

original garments to stores. 

Piracy can wipe out young careers in a single season. The most 

severe damage from lack of protection falls upon emerging designers, such as ourselves, who everyday lose orders and potentially 

5 

our entire businesses. While salvage designers and large corporations with wide recognized trademarks can better afford to absorb 

these losses caused by copying, very few small businesses can compete with those who steal their intellectual capital. It makes it 

harder for young designers to start up their own companies. And 

isn’t that the American Dream? 

Ever designer must develop their own DNA in order to make a 

lasting and recognizable impact on consumers. It is like developing 

their hit song. Imagine if a starting songwriter’s first song was stolen and recorded by someone else, with no credit to the songwriter. 

And worse, it becomes a hit. They hear it on the radio every day, 

and they are never credited. That is what happens to many young 

designers whose ideas are stolen and rendered by others. It is very 

hard to survive when you become the victim of this type of theft. 

I thought it would be helpful to talk a little bit about the economics of the industry. Designers don’t make a profit selling a 

small number of high-priced designs, but only after they offer their 

own more affordable ready-to-wear lines based on their high-end 

collections. Just like other businesses, they can lower their prices 

based on volume. Design piracy makes it difficult for a designer to 

move from higher-priced fashion to developing affordable renditions 

for a wider audience. It also makes it impossible to sell collections 

to stores when the clothes have already been knocked off for less. 

And licensing deals are then no longer an option. In other words, 

fashion designers should have the chance to knock off their own designs before others do it for them. 

Proenza Schouler is an example of successful licensing deals. 

Several years ago, we designed a collection for Target. There are 

many more examples of successful partnerships between American 

designers and large American retailers, including discount retailers. There is no reason that real innovation, rather than knockoffs, 

shouldn’t be available for everyone. The average consumer can 

wear affordable new designs created by true designers rather than 

poor copies of the real thing made by pirates in China. 

In order for this bright future to happen, we desperately need 

the ID3PA passed into law. The ID3PA has been narrowed significantly from previous Congresses. Apparel manufacturers had legitimate concerns, so designers began negotiations with the association 

representing U.S. apparel and footwear manufacturers, the AAFA. 

We are pleased that the results of those negotiations is the legislation recently introduced. 

We will need this bill to be enacted. Our industry is growing opportunities all across the country and many in your districts. We 

can’t compete against the pirates. And piracy is worsening. Without 

this legislation, this creativity and innovation that has put American fashion in the position of leadership will dry up. We ask you 

to please pass this legislation quickly. Thank you for your time. 

[The prepared statement of Mr. Hernandez follows:] 

Prepared Statement of Lazaro Hernandez, 

Fashion Designer & Co-Founder, Proenza Shouler 

INTRODUCTION

Good morning Chairman Goodlatte, Ranking Member Watt and other Members 

of the Subcommittee. I am pleased to be here today to testify in support of the InnoVerDate Aug 31 2005 12:10 Sep 01, 2011 Jkt 000000 PO 00000 Frm 00009 Fmt 6633 Sfmt 6621 H:\WORK\IP\071511\67397.000 HJUD1 PsN: 67397
6 

vative Design Protection and Piracy Prohibition Act, or ID3PA, on behalf of the 

Council of Fashion Designers of America (CFDA). CFDA is a leading trade organization representing the American fashion industry. Our members are prominent 

household names and primarily up and coming talent. The vast majority—over 

85%—are small businesses. These small businesses are creating jobs across the 

country as fashion has grown to a $340 billion industry in the U.S. The CFDA also 

counts among its fashion constituents publishing, communications, retail, manufacturers and production whose success is contingent on the success of designers. 

My design firm, Proenza Schouler, began simply as a senior project at Parsons 

School of Design. It was there that, in 1998, I met my design partner Jack 

McCollough. For three years we each designed independently. During those years 

we were fortunate to have our talent cultivated by some of the great names in the 

fashion industry; Jack was mentored by Marc Jacobs, I by Michael Kors. In our senior year at Parsons, we designed our first collection. It received the Golden Thimble 

award for best student collection and remarkably, the entire collection was bought 

by Barneys New York. As a result, at the age of 23, we launched our own independent label, Proenza Schouler, named after our mothers’ maiden names. 

In just five years, we grew from a company of three people to fifty with total annual operating costs of $15.2 million. Ours is not a typical story and it may sound 

like success came easily for us. It didn’t. Proenza Schouler is the result of tens of 

thousands of hours of very hard work, a lot of determination, talent and a little 

luck. 

COSTS OF THE FASHION BUSINESS

The fashion business is a tough business. With each new season, designers put 

their imagination to work, and their resources at risk. It takes tens of thousands 

of dollars to start a business and even more to grow and create new collections and 

shows to showcase them. Just one of our collections—and we produce 4 collections 

a year—costs $3.8 million. The cost of a typical show is approximately $320,000. So, 

before a designer has even received that first order, they’ve spent a significant sum 

of money. 

As designers we expected many of the challenges we face; the challenges of securing funding, convincing retailers to carry our collections, meeting deadlines, delivering our clothes in time to stores, finding studio space, attracting talented employees. We can handle all of those. However, we are helpless against copyists who prey 

on our ideas. Our story of long hours and sacrifice, pinching pennies to grow a business, is the same story told by countless small designers who are working as entrepreneurs to build businesses based on their own intellectual capital. We were fortunate to win awards and gain notoriety early but there are countless, undiscovered 

small designers across America working in their studios waiting to have someone 

buy their clothes or accessories. Established or undiscovered—we all have been 

touched by fashion design piracy. We luckily survived despite its disastrous effects, 

but many colleagues whose names you will never hear, had to close down. 

FASHION, INSPIRATION AND INTELLECTUAL PROPERTY

I thought it might be helpful to describe the fashion design process and how it 

is so much like other creative pursuits that today enjoy copyright protection. Fashion is not protected under current law because of the general rule exclusion of useful 

articles from the scope of copyright protection. In other words, we all must wear 

clothes. While there are other means of protecting various components of intellectual property relative to fashion, the protection of fashion design falls between the 

cracks: neither trademark (protecting the brand) or trade dress (requiring such recognition as constituting secondary meaning), or design patent (which involves such 

a lengthy process that it offers no protection against the fast creative fashion cycle) 

provide adequate protection. 

But designing a fashion collection is no different from the intellectual process involved in creating a painting or a song except perhaps its lengthy process. The development of a collection usually begins 10 months before it is launched. We draw 

inspiration from the world around us. Personally, we do research and development, 

not in a lab, but through the cultures we observe through travel, the books we read 

or the music we listen to. For example, work on our fall collection took place in the 

American West. We spent time in Wyoming, Colorado and New Mexico exploring 

Native American history and their crafts and were inspired by Navajo textiles. 

When you look at our designs you won’t see knockoffs of Navajo crafts. Instead you 

will see that we incorporated their feel and some of their elements to create our own 

originals. 

7 

Our designs are born in our imaginations, unlike the production of most basic apparel. While we create something from nothing, by far, the majority of apparel is 

based on garments already in the public domain. Nothing about the proposed legislation will change that. Nobody will ever be able to claim ownership of the t-shirt 

or the pencil skirt. When designers produce basic garments to complement the original designs in our collections and create complete outfits, we know the difference 

between what is new and what is based on a common template—and so do design 

pirates. The bill is intended to protect only those designs that are truly original. 

NEW TECHNOLOGIES & LACK OF A U.S. LAW FUELS PIRACY

In recent years America’s fashion designers have become some of the most sought 

after throughout the world. The level of originality seen on runways each season 

continues to surpass and surprise. However, with the accolades American designers 

are receiving comes the devastating blow of fashion piracy. 

One of our most popular designs has unfortunately become a typical example of 

the problem we highlight. Our PS1 satchel is one of the most knocked off designs 

on the market today. We have attempted to assert our rights and fight this piracy— 

but without success—because unfortunately it is currently legal under U.S. law. 

Current U.S. intellectual property law supports copyists at the expense of original 

designers, a choice inconsistent with America’s position in fields of industry like 

software, publishing, music, and film. Internationally, design protection is the norm. 

Every other developed country, other than China, has a law on the books to protect 

fashion except the U.S. As a result the U.S. has become a haven for copyists who 

steal designers’ ideas and sell them as their own with no fear of consequences. It 

also has become the weak link of international IP protection and the first, if not 

only, market for Chinese exporters of pirated designs. 

With every passing year, the problem of copying worsens. It is growing with new 

technologies. Just as the Internet has transformed industries like music, books and 

motion pictures, and created new opportunities for piracy, it has done the same for 

fashion. Today, global changes in both the speed with which that information is 

transferred and the location where the majority of clothing and textiles are produced have resulted in increased pressure on creative designers. Digital photographs from a runway show in New York or a red carpet in Hollywood can be 

uploaded to the Internet within minutes, the 360 degrees images viewed at a factory 

in China, and copies offered for sale online within days—months before the designer 

is able to deliver the original garments to stores. 

PIRACY HARMS DESIGNERS

I have heard the argument that somehow fashion piracy doesn’t harm the industry, but rather helps it. This is akin to the concept that stealing from legitimate 

owners encourages them to replace their property and thus boosts the Gross National Product. Those suggesting that it helps designers to have their works knocked 

off have certainly never stood in my shoes. Far from helping the designer, design 

piracy can wipe out young careers in a single season. The most severe damage from 

lack of protection falls upon emerging designers, who every day lose orders, and potentially their businesses, because copyists exploit the loophole in American law. 

While established designers and large corporations with widely recognized trademarks can better afford to absorb the losses caused by copying, very few small businesses can compete with those who steal their intellectual capital. 

Every designer must develop their own DNA in order to make a lasting and recognizable impact on consumers. It’s like developing their ‘‘hit song’’ or anthem. 

Imagine if a starting songwriter’s first song was stolen and recorded by someone 

else with no credit to the songwriter and worse, it becomes a hit. They hear it on 

the radio every day and they are never credited. That’s what happens to many 

young designers whose ideas are stolen and rendered by others. It’s very hard to 

survive when you become a victim of this type of theft. 

THE ECONOMICS OF FASHION— 

LICENSING DEALS MAKE FASHION ACCESSIBLE

Some designers make their names in high end collections, where they sell a very 

small number of rather expensive designs. While the designs can be high priced, the 

designer never recoups development costs for the designs because he or she sells so 

few garments. Designers are only able to recoup their investments when they later 

offer their own affordable ready-to-wear lines based on those high end collections. 

They then can lower the prices at which their designs are sold because they sell 

more of them. Just like other businesses—it’s dependent on volume. Design piracy 

makes it difficult for a designer to move from higher priced fashion to developing 

8 

affordable renditions for a wider audience. It also makes it impossible to sell collections to stores when the clothes have already been knocked off. Licensing deals are 

then no longer an option. In other words, fashion designers want the chance to 

knock off their own designs before others do it for them. 

Proenza Schouler is an example of successful licensing deals. Several years ago 

we designed a capsule collection of clothing and accessories for the Target GO International campaign. To those who argue that protecting fashion will drive up costs, 

accessibility and ultimately harm consumers, our experience disproves this myth. In 

the past few years we have seen a proliferation of partnerships between American 

designers and large American retailers including discount retailers. In addition to 

us, some other American designers who have collaborated with such retailers are 

Isaac Mizrahi at Target, Isabel Toledo at Payless, Norma Kamali at Wal-Mart, 

Mary Kate and Ashley Olsen at JC Penney, Billy Reid at J.Crew, Diane von 

Furstenberg at Gap and Vera Wang at Kohl’s. These stores have all seen the value 

of making the works of American designers available in their stores through licensing deals so that designers get paid for their innovation and creativity. This proves 

that the real growth of American fashion is in the lower to mid price range. 

This bill will make it easier for all designers, not just the big names, to make 

their designs available at a variety of prices in a variety of stores. There are some 

in the industry who have become comfortable with the status quo. They see no need 

for a new law and fear that they might have to change the way they do business. 

To those companies I say, talk to all of the small designers put out of business by 

your current practices and business models. 

There is no reason that real innovation, rather than knockoffs, shouldn’t be available for everybody. Consumers can have more choices precisely because of innovation. The average consumer can wear new designs, created by true designers rather 

than poor copies of the real thing made by pirates in China. As I stated before, fashion in America is a $340 billion industry, in n this economic downturn we should 

encourage growth in this sector. More competition and growth won’t occur simply 

by everybody distributing the identical product around the world because copying 

isn’t illegal. Growth won’t occur because somebody can steal a designer’s creation 

and then go sell it for a third of the price. Because innovation is the fuel of the 

U.S. economy, in the long term, lack of protection will shrink American businesses 

and provoke the loss of American jobs. 

THE ID3PA IS DESPERATELY NEEDED

Congress has passed laws to protect against counterfeits. One in three items 

seized by U.S. Customs is a fashion counterfeit. Congress has made it illegal to traffic in the labels that are used in counterfeit goods. But a copy of a design is really 

a counterfeit without the label. If no design piracy existed, there could not be counterfeiting. Both must be addressed or else the small designer with no brand recognition is left defenseless to the devastating problem of piracy, leaving only famous 

brands and big companies protected. 

It is for all these reasons that we are here today to strongly support your efforts 

to pass the Innovative Design Protection and Piracy Prevention Act. 

The legislation will provide three years of protection to designers for original designs. That is far less than the life of the author plus 70 years granted to other 

copyrighted works. However, because of the unique seasonality of the fashion industry, a shorter term of protection is reasonable. In three years a designer will have 

time to recoup the work that went into designing the article, develop additional 

lines, or license lines to retailers. 

The CFDA first came to Congress five years ago to ask for a new law. At the time 

we heard legitimate criticisms from apparel manufacturers who were fearful of the 

impact of new legislation. Designers began negotiations with the association representing U.S. apparel and footwear manufacturers—the AAFA. We are pleased 

that the result of those negotiations is the legislation recently introduced by Chairman Goodlatte, and Representatives Nadler, Sensenbrenner, Coble, Sanchez, Issa, 

Jackson Lee, Waters and others. In short, we: 

• Addressed concerns that a new law could encourage needless and expensive 

litigation by crafting a special pre-trial proceeding—pleading with particularity—during which a plaintiff would have to prove the copied design is protected and that the alleged copyist had the opportunity to have seen the design or an image of it. Designers as well as manufacturers had concerns that 

they could be on the receiving end of lawsuits and this new procedure provides important protection. 

• Included penalties for false representations to deter frivolous lawsuits. 

9 

• Protected only unique and original designs. Anything already created by the 

time of its enactment would be in the public domain and available to copy. 

It is a high standard to qualify for protection, amounting to originality plus 

novelty. New and unique designs will qualify for protection, while everything 

else remains in the public domain. 

• Addressed concerns that it is too difficult to tell if something is infringing by 

limiting the scope to copies that are ‘‘substantially identical.’’ 

• Included the doctrine of independent creation as a defense to infringement. 

This makes clear that if someone independently designs an article of apparel 

that meets the standard for infringement, (without any knowledge of the protected design) no infringement occurs. 

I am not a lawyer but we have relied on one who is an expert in fashion law heavily during this process, Professor Susan Scafidi of Fordham, the academic director 

of the Fashion Law Institute. As she told this subcommittee in 2006, the first 

version of this bill was ‘‘a measured response to the modern problem of fashion design piracy, narrowly tailored to address the industry’s need for short-term protection of unique designs while preserving the development of seasonal trends and 

styles.’’ The lengthy negotiations between the CFDA and the AAFA have resulted 

in an even more narrowly and precisely tailored way to support the entire American 

fashion industry. 

We need your help to get back to the business of designing. We’re all entrepreneurs who create our fashion with the hope of designing something that will 

catch on and capture the imagination of U.S. consumers. Success that starts in our 

individual design studios grows opportunities all across the country for fabric manufacturers, printers, pattern makers, the shippers and truckers who transport the 

merchandise, design teams, fabric cutters, tailors, models, seamstresses, sales people, merchandising people, advertising people, publicists, and those who work for retailers. This is a big employment business today. We are creating jobs across this 

country. 

However, we can’t compete against piracy. Without this legislation, the creativity 

and innovation that has put American fashion in a leadership position will dry up. 

Innovation is an investment but we can’t innovate without protection and urge you 

to quickly pass this legislation. Thank you for your time. 

Mr. GOODLATTE. Thank you, Mr. Hernandez. 

Before we go on to Professor Suk, I want to acknowledge the 

presence of the Ranking Member. The gentleman from North Carolina, Mr. Watt—the Ranking Member of the full Committee and I 

have submitted our testimony for the record. 

If you are satisfied with that, we will proceed to the next witness. 

[The prepared statement of Mr. Watt follows:] 

10 


67397A-1.eps
11 


67397A-2.eps
12 

Mr. CONYERS. Mr. Chairman, can we recognize the presence of 

Judy Chu as well? 

Mr. GOODLATTE. We absolutely welcome her and the other gentlewoman from California, Ms. Lofgren. 

And the gentleman from Ohio, Mr. Chabot. 

We will now turn to Professor Suk. 


67397A-3.eps
13 

Welcome. 

TESTIMONY OF JEANNIE SUK, PROFESSOR OF LAW, 

HARVARD LAW SCHOOL 

Ms. SUK. Chairman Goodlatte, Ranking Member Watt, and Members of the Subcommittee, thank you for holding this hearing and 

for inviting me to speak to you today. 

I am Jeannie Suk, professor at Harvard Law School, where I conduct research on law and innovation in the fashion industry. My 

testimony today is based on my scholarly work with Professor Scott 

Hemphill of Columbia Law School, and I have submitted our article, ‘‘The Law, Culture, and Economics of Fashion,’’ which was published in the Stanford Law Review. I have submitted that along 

with my written testimony. 

Like all of the arts, fashion design involves borrowing and influence from existing works and themes in our culture. Even the most 

original creation in the arts is indebted to prior work. And so, appropriately, Federal copyright law does not consider most of the 

similarity or even copying in the arts to be copyright infringement. 

When there is a trend in fashion, just as in movies, books, music, 

and culture, many people are converging on similar ideas through 

conscious and unconscious influence by work from the past and the 

present. 

But these common forms of borrowing do not require blatant replication of another’s work product, a practice that takes profits 

from the original producer and thus undermines the incentive to 

create that Federal copyright law aims to foster. 

The ID3PA protects the incentive to create but also safeguards 

designers’ ability to use a large domain of creative influences and 

to participate in fashion trends. Deviating from the ordinary copyright infringement standard with a much narrower substantially 

identical standard for infringement, the Act allows plenty of room 

for designers to draw inspiration from others, much more room 

than producers of books, movies, and music currently have. At the 

same time, it prohibits copyists from selling near exact copies of 

original designs. In short, the ID3PA strikes an effective balance 

between the significant public interest in incentivizing the creation 

of original design and the equally important public interest in leaving designs largely available for free use. 

A key distinction to recognize is the distinction between products 

that are inspired by a designer’s work and products that replicate 

or knock off a designer’s work without any effort at modification. 

For simplicity, I am going to call these ‘‘inspired-bys’’ and 

‘‘knockoffs.’’ 

If you have difficulty telling the difference between two designs, 

you are looking at a copyist’s 

Knockoff, not an inspired-by. This is a crucial difference as a 

matter of innovation policy because knockoffs cannot plausibly 

claim to be forms of innovation, whereas inspired-bys can. 

Knockoffs directly undermine the market for the original designs 

and reduce the designer’s incentive to innovate in ways that inspired-bys do not. 

The ID3PA is therefore a highly moderate bill that only targets 

businesses that produce and sell knockoffs of original designs. The 

14 

vast majority of the apparel industry will not be affected. If retailers are not selling knockoffs, they have nothing to fear from this 

bill. And even if they are, they are still safe if the design that they 

knock off is in the public domain or is not itself original, or if they 

are unaware that the items that they sell are knockoffs. And even 

if the copied design is original, knockoff sellers can simply wait 3 

years for the copyright term on a particular original design to end. 

The ID3PA reflects a judgment that knockoffs are not necessary 

to the business model of high-volume sellers of 

on-trend clothing at a low price point. This judgment is correct. 

Current knockoff sellers would need to adapt their businesses to 

focus on selling inspired-bys instead. They would have to innovate 

and invest somewhat in design rather than only replicate others’ 

work in full. 

Does this mean consumers would no longer have low-price access 

to designs by great designers? No. Many extremely talented designers, such as Mr. Hernandez and his colleagues, have partnered 

with high-volume retailers, such as Target and H&M, to offer their 

designs in large numbers at a low price. The ID3PA encourages 

this kind of partnership because this allows designers to profit 

from the creative labor they invest in their original designs. If retailers wish to sell these designs with minimal or no modification, 

under the Act, they would have to reach an arrangement with the 

designer to do so, or face liability. 

Our current intellectual property system unintentionally creates 

an unfortunate bias in favor of the most established famous fashion 

firms and against smaller emerging designers who have the most 

potential for innovation in design. Established firms like Louis 

Vuitton have the benefit of trademark and trade dress protection. 

Their advertising promotes and protects their brand image, as does 

the use of high-end materials and workmanship that are very difficult to copy at a low cost. They have a clientele that does not 

often overlap with the discount shoppers. And all of this means 

that the established luxury firms suffer comparatively less from the 

design knockoffs than their smaller, not as established counterparts. 

Emerging designers do not have the advantages just described. 

Their products are not well enough recognized to qualify for trademark or trade dress protection, nor do they have the money to advertise and reinforce their brand image. But what these designers 

do have to offer consumers is their innovative designs. They cannot 

command the same prices as the famous luxury firms. Thus, 

emerging designers are more likely to be in competition with their 

copyists as their consumer bases are more likely to overlap. A design that retails for hundreds instead of thousands is within the 

reach of many consumers who might well opt for the still less expensive knockoff. Thus, knockoffs are particularly devastating for 

emerging and mid-range designers who face significant entry barriers and struggle to stay in business. 

This act helps level the playing field, which is currently skewed 

to the protection of luxury and brands rather than innovation in 

design. The ID3PA strikes an appropriate balance between giving 

incentives to create and leaving designers free to draw upon influences. If enacted, it would serve its purpose to push the fashion inVerDate Aug 31 2005 12:10 Sep 01, 2011 Jkt 000000 PO 00000 Frm 00018 Fmt 6633 Sfmt 6601 H:\WORK\IP\071511\67397.000 HJUD1 PsN: 67397
15 

1 C. Scott Hemphill & Jeannie Suk, The Law, Culture, and Economics of Fashion, 61 STAN. L. REV. 1147 (2009); C. Scott Hemphill & Jeannie Suk, Reply: Remix and Cultural Production, 

61 STAN. L. REV. 1227 (2009); C. Scott Hemphill & Jeannie Suk, The Squint Test, How to Protect 

Designers like Jason Wu from Forever 21 Knockoffs, SLATE, May 13, 2009, http://www.slate.com/ 

id/2218281/(last visited Jul. 10, 2011); C. Scott Hemphill & Jeannie Suk, Schumer’s Project Runway, WALL STREET JOURNAL, Aug. 24, 2010, available at http://online.wsj.com/article/ 

SB10001424052748704504204575445651720989576.html (last visited Jul 10, 2011). 2Design Piracy Prohibition Act, S. 1957, 110th Cong. (2007); Design Piracy Prohibition Act, 

H.R. 2033, 110th Cong. (2007) 3 Innovative Design Protection and Piracy Prevention Act, S. 3728, 111th Cong. (2010). 

dustry toward innovation rather than substantially identical copying. It represents a wisely balanced and a carefully tailored response to the problems of this industry. 

Thank you, and I look forward to your questions. 

[The prepared statement of Ms. Suk follows:] 

Prepared Statement of Jeannie Suk, Professor of Law, 

Harvard Law School 

Chairman Goodlatte, Ranking Member Watt, and Members of the Subcommittee, 

I am Jeannie Suk, Professor of Law at Harvard Law School. Thank you for this opportunity to testify about the Innovative Design Protection and Piracy Prevention 

Act (‘‘IDPPPA’’). My remarks draw on my ongoing research with Professor Scott 

Hemphill of Columbia Law School on law and innovation in the fashion industry.1

Along with my testimony, I submit our Stanford Law Review article, The Law, Culture and Economics of Fashion. We have also written on the Act’s predecessors: two 

iterations of the Design Piracy Prohibition Act,2 and the Innovative Design Protection and Piracy Prevention Act introduced in the Senate last Term.3 I submit one 

of these articles, published in the Wall Street Journal. 

Like all of the arts, fashion design inevitably involves degrees of borrowing and 

influence from both specific existing works and general themes in our culture. Even 

the most original creative work in the arts has important debts to prior work. Appropriately, federal copyright law does not consider most of the borrowing and similarity that occurs in the course of creative production to be copyright infringement. 

A trend in fashion—just as in movies, books, music, and culture—is the convergence 

on similar themes by many different producers who are consciously and unconsciously influenced and inspired by other work from the past and the present. But 

these common forms of borrowing in the arts do not require blatant replication of 

another’s work, a practice that most directly takes profits from the original producer 

and thus most undermines the incentive to create that federal copyright law aims 

to foster. 

The goal of a law addressing copying in fashion design should indeed be to give 

an incentive to create, but also to safeguard designers’ ability to draw upon a large 

domain of creative design influences and to participate in fashion trends. The 

IDPPPA, in its current form, achieves this goal. By deviating from the ordinary 

copyright infringement standard with the much narrower ‘‘substantially identical’’ 

standard for infringement, it allows plenty of room for designers to innovate by 

drawing inspiration from others—much more room than producers of books, music, 

and film currently have. At the same time, it prohibits copyists from making exact 

or near-exact copies of original designs. It rewards designers who produce original 

work with legal protection against copyists, but limits frivolous litigation through 

heightened pleading requirements. It protects creative designers’ ability to profit 

from their original work, but maintains, or even expands, consumer choice. In short, 

the IDPPPA strikes an effective balance between the significant public interest in 

incentivizing the creation of original design and the significant public interest in 

making existing design vocabularies largely available for free use. 

EFFECTS ON RETAILERS

A key distinction that must frame an analysis of the IDPPPA is the difference 

between products that are inspired by a designer’s work and products that replicate 

a designer’s work without effort at modification. The IDPPPA most squarely affects 

clothing producers and sellers known as ‘‘fast fashion’’ firms. Many simply think of 

these firms as blind copiers of the latest trendy designs, but fast fashion firms actually fall into two distinct categories: designers and copyists. Fast fashion designers, 

like H&M and Zara, usually take the latest trends and adapt or interpret them. The 

result is a relatively inexpensive product that is clearly inspired by, but not idenVerDate Aug 31 2005 12:10 Sep 01, 2011 Jkt 000000 PO 00000 Frm 00019 Fmt 6633 Sfmt 6621 H:\WORK\IP\071511\67397.000 HJUD1 PsN: 67397
16 

tical to, other designers’ products. By contrast, fast fashion copyists, like Forever 21, 

choose particular designs to copy, and replicate those specific designs as best they 

can. These firms make no effort to modify the original design. 

I am going to call fast fashion designers’ products ‘‘inspired-bys,’’ and fast fashion 

copyists’ products ‘‘knockoffs.’’ Put simply, if you have difficulty telling the difference 

between two designs, you are looking at a copyist’s knockoff, not a designer’s inspired-by. The difference between inspired-bys and knockoffs is crucial. It is a distinction that can be easily grasped by designers, retailers, and consumers. We need 

to allow the inspired-bys while stopping the knockoffs, which directly undermine the 

market for the original designs that copyists target and which reduce the incentive 

to innovate. The IDPPPA’s narrow infringement standard is designed to do just 

that—to distinguish between those who engage in interpretation of others’ work and 

participate in a fashion trend, and those who slavishly copy a particular original design. 

Retailers who sell clothing that is on trend but not an exact copy need not fear 

this Act. But the IDPPPA would undoubtedly harm those retailers whose businesses 

rely upon selling exact knockoffs of particular designs. This is what the Act is intended to do. Those retailers would no longer be able to avoid design costs by freely 

taking another’s design in its entirety. Current retailers of copyists would have to 

adapt to the IDPPPA’s requirements. They could do so in several ways. First, knocking off is not necessary to the business model of high-volume sellers of on-trend 

clothing at a lower price point. Sellers of knockoffs could become sellers of inspiredbys. They could employ designers—or direct the designers they currently employ— 

to engage and modify other designers’ original designs. Such work would not be infringing, as it would not be ‘‘substantially identical’’ to a protected original design. 

And even where the copies are substantially identical, the copied design may not 

meet the high standard for originality that is needed for protection under the 

IDPPPA. Second, fast fashion firms could partner with designers, and sell the resulting products inexpensively. Fast fashion firms do engage in many such partnerships already. The IDPPPA would bring the sellers of knockoffs into the fold such 

that they would need the designers’ authorization to make knockoffs of original designs. 

While our current intellectual property regime does not provide protection for 

fashion design, it does provide protection for fashion firms’ trademark and trade 

dress. Large, well-known firms like Louis Vuitton and Chanel have the benefit of 

trademark and trade dress protection. Their advertising promotes and protects their 

brand-image, as does the use of high-end materials and workmanship that are difficult to copy at low cost. They also have a wealthy clientele that does not often 

overlap with the shoppers at Forever 21. All this means that established luxury 

firms suffer comparatively less from the practice of knocking off than their smaller, 

not as famous counterparts. Young and emerging designers do not have all the advantages just described. Young designers’ products are generally not well enough 

recognized to qualify for trademark or trade dress protection. Nor do they have the 

money to advertise and reinforce their brand image. They cannot command the 

same premium for their products as the famous high-end luxury firms. Thus emerging designers are more likely to be in direct competition with their copyists, as their 

customer bases overlap. A designer’s dress that retails for $300 instead of $3000 is 

within the reach of many consumers who might well opt for the still less expensive 

knockoff. Thus, knockoffs are particularly devastating for emerging designers, who 

face significant entry barriers and struggle to stay in business. This Act would help 

level the playing field with respect to protection from copyists and allow more such 

designers to enter the market, create, and flourish. Such an increase in emerging 

and smaller designer market participation would ultimately benefit retailers who 

sell the smaller designers’ products, such as department stores. 

That many less-established designers may lack resources to hire lawyers and sue 

copyists does not change this analysis. First, even under current law, smaller designers already do file suit against copyists, attempting to cobble together some 

semblance of protection against design copying by relying on currently existing intellectual property protections in trademark and copyright. There is little reason to 

doubt that small designers would utilize protection for design, which is after all 

what they are really after in the lawsuits they currently file. Second, litigation by 

large fashion firms against copyists making knockoffs could have positive collateral 

consequences for small designers. For instance, if Forever 21 had to change its business model because it could no longer create replicas of products by Louis Vuitton— 

which does have the resources to litigate under the IDPPPA—that change in the 

culture and norms of fashion design would also work to small designers’ benefit. 

Such enforcement by larger plaintiffs, in other words, may produce systemic 

changes that would work to smaller entities’ advantage. Finally, while small designVerDate Aug 31 2005 12:10 Sep 01, 2011 Jkt 000000 PO 00000 Frm 00020 Fmt 6633 Sfmt 6621 H:\WORK\IP\071511\67397.000 HJUD1 PsN: 67397
17 

4 UNITED STATES SENATE, COMMITTEE ON THE JUDICIARY, Executive Business Meeting 53:14 

(Dec. 1, 2010), http://judiciary.senate.gov/hearings/hearing.cfm?id=e655f9e2809e5476862f735da 

165262f (last visited Jul. 10, 2011) (comments of Senator John Cornyn). 5The Law, Culture, and Economics of Fashion, supra note 1, at 1173. 6 Id. 

ers often lack the resources to hire lawyers on an hourly basis, nothing in the Act 

prohibits contingent fee arrangements. Such arrangements would allow small designers to vindicate their rights, even if they could not afford to pay a lawyer’s usual 

hourly fees. 

EFFECTS ON CONSUMER CHOICE

Unquestionably the IDPPPA would change the consumer’s playing field. Because 

fast fashion copyists could no longer sell inexpensive knockoffs without authorization, consumers may lose the low-price alternative knockoffs now offered. In an 

IDPPPA regime, such consumers may not have access to those exact designs at the 

knockoff price. For some, this will seem a significant limitation, especially since the 

customer who shops for the knockoff of a Louis Vuitton item is not the same customer who would buy the genuine article. 

This limitation, however, is not as substantial as it may appear. First, the 

IDPPPA’s protections would move fast-fashion designers to engage with those designs—that is, innovate—rather than simply replicate them. Indeed, the modifications copyists would be required to make under the IDPPPA would serve to expand 

consumer choice as high-volume sellers shifted their efforts toward inspired-bys and 

away from knockoffs. The increase in the variety of inspired-by designs would more 

than offset the loss of choice from prohibiting knockoffs. 

Second, many high-end designers have partnered with higher-volume discount retailers such as Target and H&M to offer their goods at a lower price point. The 

IDPPPA encourages this kind of partnership. Under the Act, discount retailers 

would have even more incentive to pair with designers if they wished to sell others’ 

designs with minimal or no modification. 

Therefore, while the IDPPPA would restrict consumer choice in terms of easy 

availability of unauthorized knockoffs at a low price, it would increase consumer 

choice in terms of selection of goods. Fast-fashion copyists would have to become fast 

fashion designers who engage with designers’ output, and thereby produce new options for consumers. 

EFFECTS ON LITIGATION

Last Term, when the Senate Judiciary Committee considered a version of the 

IDPPPA identical to this Act, one Member raised the concern that the IDPPPA 

might produce a flood of litigation.4 The Member pointed to two elements of the Act 

in support of this concern. First, the Act gives designers the ability to protect their 

designs, without any registration requirement. Hence, any designer could claim that 

any design was protected, and so could attempt to litigate under the statute. Second, some of the statute’s language—specifically the ‘‘substantially identical’’ and 

‘‘non-trivial’’ requirements—may require significant judicial interpretation. Hence, 

designers and copyists alike would have an incentive to litigate, in an effort to define their rights and liabilities under the statute. Combined, the Member suggested, 

these factors might lead to a flood of litigation in the already busy federal courts. 

This concern is overstated. First, the Act requires that plaintiffs plead each element of a design infringement claim with particularity. This requirement will curtail many frivolous lawsuits before they begin, and will cull others out at an early 

stage. Second, the Act’s ‘‘substantially identical’’ standard for infringement is a high 

bar, as is the Act’s stringent standard for originality. Litigation under the Act will 

be concentrated around knockoffs, leaving inspired-bys relatively untouched. Even 

under the current intellectual property regime, we see far greater numbers of lawsuits by designers against sellers of knockoffs than against sellers of inspired-bys. 

From 2003 to 2008, at least fifty-three lawsuits alleging trademark and copyright 

infringement were filed against Forever 21.5 By contrast, two were filed against 

H&M and none were filed against Zara.6 Under the IDPPPA, we could similarly expect to see sellers of inspired-bys remain relatively untouched, and the sellers of 

knockoffs would either have to adapt their business strategy or face liability. 

Nor is it likely that large fashion firms, recognizing less-established designers as 

competition, would succeed in driving those designers out of business by saddling 

them with litigation costs through baseless suits. IDPPPA plaintiffs must plead with 

particularity that the allegedly infringing article is ‘‘substantially identical in overall 

visual appearance to . . . the original elements of a protected design,’’ or is not ‘‘the 

18 

7See Fed. R. Civ. P. 11(b)(1), (c) (imposing sanctions for complaints presented for an improper 

purpose). 

result of independent creation.’’ To plead with particularity that a copy is ‘‘substantially identical’’ when the allegedly offending garment is not easily mistaken for the 

original would be extremely difficult. A baseless suit would be subject to early dismissal. Moreover, a suit filed simply to harass or lacking the requisite particular 

facts, might lead to sanctions against the firm and its lawyers.7 These factors—the 

‘‘substantially identical’’ standard, the heightened pleading requirement, and the 

prospect of sanctions—create a strong deterrent against suits meant to drive upstart 

designers out of business by imposing litigation costs. 

Of course, there would be litigation under the IDPPPA, and courts would have 

to interpret the language in the Act and sometimes draw difficult lines. But this 

is the natural consequence of Congress’s passing any law. The IDPPPA’s internal 

controls on litigation would discourage litigiousness and stem the flood of litigation 

that some fear. 

The IDPPPA strikes an appropriate balance between giving incentives to create 

original designs and leaving designers free to draw upon influences, inspirations, 

and trends. If enacted, it would serve its purpose, to push the fashion industry toward innovation rather than substantially identical copying. The new law would 

harm fast fashion copyists but not retailers as a whole—and even then, only by compelling firms to change their businesses in ways consistent with Act’s purpose. It 

would increase consumers’ choice of designs that are inspired by other designs and 

that participate in trends, while limiting their ability to buy exact knockoffs of designs. It would not promote unnecessary litigation, but to the contrary, represents 

a wisely balanced and carefully tailored response to the problems of a distinctive 

industry. 

Thank you for the opportunity to discuss this important Act with the Subcommittee. I look forward to your questions. 

Published works submitted: 

C. Scott Hemphill & Jeannie Suk, The Law, Culture, and Economics of Fashion, 

61 STAN. L. REV. 1147 (2009), http://papers.ssrn.com/sol3/papers.cfm?abstract 

lid=1323487 

C. Scott Hemphill & Jeannie Suk, Schumer’s Project Runway, WALL STREET JOURNAL, Aug. 24, 2010, http://online.wsj.com/article/SB10001424052748704504204 

575445651720989576.html 

19 

ATTACHMENT 1 


67397B-1.eps
20 


67397B-2.eps
21 


67397B-3.eps
22 


67397B-4.eps
23 


67397B-5.eps
24 


67397B-6.eps
25 


67397B-7.eps
26 


67397B-8.eps
27 


67397B-9.eps
28 


67397B-10.eps
29 


67397B-11.eps
30 


67397B-12.eps
31 


67397B-13.eps
32 


67397B-14.eps
33 


67397B-15.eps
34 


67397B-16.eps
35 


67397B-17.eps
36 


67397B-18.eps
37 


67397B-19.eps
38 


67397B-20.eps
39 


67397B-21.eps
40 


67397B-22.eps
41 


67397B-23.eps
42 


67397B-24.eps
43 


67397B-25.eps
44 


67397B-26.eps
45 


67397B-27.eps
46 


67397B-28.eps
47 


67397B-29.eps
48 


67397B-30.eps
49 


67397B-31.eps
50 


67397B-32.eps
51 


67397B-33.eps
52 


67397B-34.eps
53 


67397B-35.eps
54 


67397B-36.eps
55 


67397B-37.eps
56 


67397B-38.eps
57 


67397B-39.eps
58 


67397B-40.eps
59 


67397B-41.eps
60 


67397B-42.eps
61 


67397B-43.eps
62 


67397B-44.eps
63 


67397B-45.eps
64 


67397B-46.eps
65 


67397B-47.eps
66 


67397B-48.eps
67 


67397B-49.eps
68 


67397B-50.eps
69 


67397B-51.eps
70 


67397B-52.eps
71 


67397B-53.eps
72 


67397B-54.eps
73 

ATTACHMENT 2 


67397C-1.eps
74 

Mr. GOODLATTE. Thank you, Professor Suk. 

Professor Sprigman, welcome. 

TESTIMONY OF CHRISTOPHER SPRIGMAN, PROFESSOR OF 

LAW, UNIVERSITY OF VIRGINIA SCHOOL OF LAW 

Mr. SPRIGMAN. Thank you. 

I want to start by thanking the Subcommittee and especially 

Chairman Goodlatte and Ranking Member Watt for inviting me 

today. For the past 6 years, along with my friend and colleague Kal 


67397C-2.eps
75 

Raustiala from the UCLA Law School, I have studied innovation 

and competition in the fashion industry. Professor Raustiala and I 

have written an academic article on the topic entitled, ‘‘The Piracy 

Paradox: Innovation and Intellectual Property in Fashion Design,’’ 

and a followup article, ‘‘The Piracy Paradox Revisited.’’ I have also 

given testimony on this issue before this submitted before back in 

2006. I testified in a predecessor to the current ID3PA. 

So I have some new data for you, but before I get 

there—and I have some slides—I want to talk about a bit of history. The issue of protection for fashion design is not new. Since 

the end of World War II, Congress has considered providing some 

sort of copyright protection for fashion designs on about a dozen occasions. And each time they declined to do so, I believe there was 

wisdom in that. 

The U.S. fashion industry has grown and thrived over the past 

half century—and it continues to do so today. Sales of apparel and 

shoes have registered virtually uninterrupted annual increases 

since 1945, growing during this period more than twentyfold. The 

fashion industry in the U.S. is a leader in the world. It produces 

a huge variety of apparel. Innovation occurs at a pace that is unheard of in other industries. Styles change rapidly. Goods are produced for consumers at every conceivable price point. In short, the 

fashion industry looks exactly as we would expect a healthy, competitive, creative industry to look. 

The important point here is that all of the fashion industry’s 

growth and innovation has occurred without any intellectual property protection in the U.S. for its designs. Indeed, never in our history has Congress granted legal protections for designs of fashion 

goods. The fashion industry enjoys trademark protection for 

brands. It enjoys copyright protection for its fabric designs. But the 

shape, the cut, the style of a garment is not protected by copyright 

law or any other form of IP in this country. 

But unlike in the music or film or publishing industries, copying 

of fashion designs has never emerged as a threat to the survival 

of the fashion industry. And why is that? Well, it is because of 

something we all know instinctively about fashion. And Shakespeare, as usual, put it best: The fashion wears out more apparel 

than the man. That is, many people buy new clothes not because 

they need them but because they want to keep up with the latest 

style. And this simple truth lies at the foundation of the fashion 

industry. It makes copying an integral part of that industry’s success. 

So why is that? Well, without copyright restrictions, designers 

are free to rework an appealing design. The result is fashion’s most 

sacred concept: The trend. Copying creates trends. And trends are 

what sell fashion. Every season, we see designers take inspiration 

from others. Trends catch on. They become overexposed. And then 

they die. New designs take their place. This cycle is familiar. But 

what is rarely recognized is that the cycle is accelerated by the 

freedom to copy. 

In our articles, Professor Raustiala and I explain how copying 

and creativity actually work together in the fashion industry. For 

fashion, copying does not deter innovation. It speeds it up. 

76 

Now I want to take a look at some new data that we have uncovered that supports our views. 

Can I have the first slide? 

So I have been working data from the Consumer Price Index, our 

government’s official measure of inflation. We have been looking to 

see if the changes over time in the prices of apparel suggest any 

significant effect on the fashion industry from the copying of fashion designs. To do this, we collected data on the prices of women’s 

dresses from 1998 to the present. This is hundreds of thousands of 

observations of prices. We then divided the dresses into 10 categories—we created 10 categories ranging from the cheapest 10 

percent of dresses, like apparel on discount racks, to the most expensive 10 percent, like for example, Mr. Hernandez’ designs. 

Here is a graph illustrating what we found. What you see is price 

stability over the entire period for every category except one, the 

top category, the most expensive women’s dresses. What happened 

there? The average price of the most expensive 10 percent of women’s dresses went up substantially over the data period. Now, actually, the ninth decile, which isn’t shown here, behaved the same 

way as the tenth—the most expensive 20 percent of women’s 

dresses have gotten much more expensive since 1998. Everything 

else has gotten cheaper or stayed the same. 

And what does this mean? Well, if cheap fashion copies were 

competing with the more expensive garments they are imitating, 

we would expect to see some effect on the prices of high-end garments. In short, competition from cheap copies would tend to depress the prices paid for the high-end origins. But that is not happening. The high-end originals are the only garments that have 

any price growth during this period. And the price growth of the 

segments is very healthy. 

This is particularly impressive when you look at this next graph. 

This is in percentage terms. We have a 250 percent price growth 

over the period for the most expensive garments. The second decile, 

the second tenth, behaves about the same. That means that for the 

top designers as well as for the entry designers in high-level fashion, prices are very robust. 

So the takeaway from this is I don’t think the ID3PA is necessary. We have a healthy competitive industry. During the question period, I would like to explain, so I don’t take too much time, 

why I think the ID3PA could cause some mischief. It is not only 

that it is unnecessary, but it could lead to a lot of litigation. This 

isn’t going to create jobs, I think, except for lawyers. I can explain 

more about that if anyone cares to know. 

Thank you very much. 

[The prepared statement of Mr. Sprigman follows:] 

77 


Sprig-1.eps
78 


Sprig-2.eps
79 


Sprig-3.eps
80 


Sprig-4.eps
81 


Sprig-5.eps
82 


Sprig-6.eps
83 


Sprig-7.eps
84 


Sprig-8.eps
85 


Sprig-9.eps
86 


Sprig-10.eps
87 


Sprig-11.eps
88 


Sprig-12.eps
89 


Sprig-13.eps
90 

Mr. GOODLATTE. Thank you, Professor Sprigman. 

We will now turn to Mr. Courtney. 

Welcome. 


Sprig-14.eps
91 

TESTIMONY OF KURT COURTNEY, MANAGER, GOVERNMENT 

RELATIONS, AMERICAN APPAREL & FOOTWEAR ASSOCIATION 

Mr. COURTNEY. Thank you, Chairman Goodlatte, Ranking Member Watt, Ranking Member Conyers, and Members of the Subcommittee, for inviting the American Apparel & Footwear Association to testify today in support of the Innovative Design Protection 

and Piracy Prevention Act. 

My name is Kurt Courtney and I am manager of government relations for AAFA, where I work on a range of intellectual property 

rights issues for the apparel and footwear industry. My written 

statement goes into further detail about our members. But in summary, AAFA’s collective membership represents the largest cross 

section of the fashion industry across all price points for consumers 

worldwide. Our industry accounts for more than 1 million U.S. employees and more than $340 billion at retail each year. 

Ensuring strong protection of intellectual property has always 

been a key priority for AAFA and its member companies. Our 

members fight endlessly to protect their trademarks and brand 

names in the U.S. And throughout the world. It is with this in 

mind that we are pleased to appear before you today. 

Mr. Chairman, in 2006, you introduced the Design Piracy Prohibition Act, the DPPA, which sought to offer new copyright protection for original fashion designs. As AAFA’s legal team evaluated 

the bill, we wholeheartedly understood the narrow problem the legislation was trying to solve, but we fundamentally disagreed with 

its overly broad definitions, which industry experts and legal counsel feared would have opened a Pandora’s box of litigation that 

would have been very detrimental to the industry. 

At that time, Mr. Chairman, we expressed these concerns to you 

and you challenged us to help develop a more targeted bill to protect original fashion designs and not increase the prevalence of 

lawsuits in our industry. So we went to work. In conjunction with 

the Council of Fashion Designers of America, CFDA, we worked 

with your office and New York Senator Charles Schumer to develop 

the ID3PA. This legislation represents a targeted approach that 

will solve this narrow design piracy problem without exposing any 

innocent actor in the fashion industry to confusing rules and frivolous legal claims. 

Throughout the process, we realize that there were a number of 

misconceptions that had to be dismissed. 

First, many in the media, academia, and even in the industry 

continue to believe that the ID3PA addresses the much larger and 

more virulent problem of trademark counterfeiting. It does not. By 

copying both trademarks and their associated designs, whether 

those designs are original or not, trademark counterfeiters attempt 

to profit on the good names and reputations that our members 

have spent decades building with their customers. This practice is 

illegal worldwide and leads to billions of dollars in losses each 

years. It represents a major enforcement priority of the United 

States Government, as Customs and Border Protection recently reported that footwear, apparel, and fashion accessories—like handbags—were the first, third, and fourth most seized counterfeit 

items by value at our borders last year. 

92 

The second misconception arose concerning the relationship between AAFA and CFDA. With our association’s initial opposition to 

the CFDA-supported DPPA, it lead many to believe that AAFA was 

protecting the copyists. As we have explained previously, CFDA 

and AAFA have many of the same members, and in many instances, CFDA designers often work directly with or license their 

brand name to one or more of our members. Neither association 

wanted to back legislation that would make it harder to design apparel and footwear or give lawyers a hand in the design process. 

Third, there remains a deep misconception about the scope of 

this legislation. And I want to be very clear on this point. The 

ID3PA will not cover everything in the fashion world. In fact, it 

will only cover those original articles which are so truly unique 

that they come closer to art than functionality. To put even a finer 

point on this, by definition, the bill states that nothing in the public domain, which is the collective works of thousands of years of 

fashion history, can be protected under this bill. 

Fourth, very few companies will have to worry about possible accusations of infringements. To infringe an article must, among 

other things, be substantially identical to an original article. The 

substantially identical standard is tighter than what had appeared 

in the ID3PA and is defined as so close in appearance that it would 

likely be mistaken for the original. While the substantially identical standard may be easily met for basic garments—the blue 

jeans or underwear in your dresser—it is a very high threshold 

when compared against never-before-seen fashion articles discussed 

above. 

We address a fifth misconception, that the new legislation will 

lead to frivolous lawsuits. The ID3PA includes a heightened pleading process where the burden falls entirely on the plaintiff to plead 

with particularity before any legal action can commence. And in 

that pleading, the plaintiff must show, number one, facts that his 

or her design is original; number two, that the potential defendant’s design is substantially identical to his or her design; and 

number three, facts showing that the defendant had some access 

to the design and must have seen it before making the infringing 

design. 

In closing, AAFA believes the ID3PA provides a targeted fix to 

the narrow design piracy problem. The legislation provides designers with a clear and easily understandable framework so they can 

enforce their own original designs. At the same time, it contains 

multiple protections to ensure that those same designers can seek 

inspiration and harness fashion trends without the chilling effect 

of frivolous lawsuits. 

I want to thank you again for the opportunity for allowing me 

to testimony today, and I look forward to answering any questions. 

[The prepared statement of Mr. Courtney follows:] 

Prepared Statement of Kurt Courtney, Manager, Government Relations, 

American Apparel & Footwear Association 

Thank you, Chairman Goodlatte, Ranking Member Watt and members of the subcommittee for inviting the American Apparel & Footwear Association (AAFA) to testify today in support of the Innovative Design Protection and Piracy Prevention Act 

or ID3PA. 

93 

My name is Kurt Courtney, and I am Manager of Government Relations for 

AAFA, where I work on a range of intellectual property rights issues for the apparel 

and footwear industry. 

Our membership includes some of the most recognizable apparel and footwear 

brands serving virtually every market segment—ranging from haute couture to 

mass market. Our membership includes a diverse group, including some of the largest and some of the smallest companies in the industry. They are located in many 

states, including a number of traditional manufacturing hubs in New York, Los Angeles, the North East and the Southeast. Our members employ thousands of designers across the United States. Collectively, AAFA’s membership represents the largest cross section of the fashion industry across all price points for consumers worldwide. Our industry accounts for more than one million U.S. employees and more 

than $340 billion at retail each year. 

Ensuring strong protection of intellectual property has always been a key priority 

for AAFA and its membership. Our members fight endlessly to protect their trademarks and brand names in the U.S. and throughout the world. It is with this in 

mind that we are pleased to appear before you today. 

Mr. Chairman, in 2006, you introduced the Design Piracy Prohibition Act (DPPA), 

which sought to offer new copyright protection for original fashion designs. As 

AAFA’s legal team evaluated the bill, we wholeheartedly understood the narrow 

problem the legislation was trying to solve. But we fundamentally disagreed with 

its overly broad definitions, which industry experts and legal counsel feared would 

have opened a Pandora’s box of litigation that would have been detrimental to the 

industry. 

At that time, Mr. Chairman, we expressed these concerns to you and you challenged us to help develop a more targeted bill to protect original fashion designs 

and not increase the prevalence of lawsuits in our industry. So we went to work. 

In conjunction with the Council of Fashion Designers of America (CFDA), we 

worked with your office and New York Senator Chuck Schumer to develop the Innovative Design Protection and Piracy Prevention Act. This legislation represents a targeted approach that will solve this narrow design piracy problem without exposing 

any innocent actor in the fashion industry to confusing rules and frivolous legal 

claims. 

Throughout the process, we realized that there were a number of misconceptions 

that had to be dismissed. 

First, many in the media, academia and even in the industry continue to believe 

that the ID3PA addresses the much larger, and more virulent problem of counterfeiting. It does not. By copying both trademarks and their associated designs 

(whether original or not), counterfeiters attempt to profit on the good names and 

reputations that our members have spent decades building with their customers. 

This practice is illegal worldwide and leads to billions of dollars in losses each year. 

It represents a major enforcement priority of the U.S Government, as Customs and 

Border Protection recently reported that footwear, apparel and accessories like 

handbags were the first, third and fourth most seized counterfeited items by value 

at our borders last year. 

I would note that the so-called ‘‘rogue website’’ legislation currently before the 

Senate and being separately developed in the House will help address one of the 

more onerous ways counterfeiters steal from legitimate companies—by establishing 

fake websites to fool consumers into thinking that they are buying legitimate products. As we move forward on ID3PA, we look forward to continue working with you 

and your staff on this very important issue and other ways to combat counterfeiting. 

The second misconception arose concerning the relationship between AAFA and 

CFDA. With our association’s initial opposition to the CFDA-supported DPPA, it led 

many to believe that AAFA was protecting the copyists. As we have explained previously, CFDA and AAFA have many of the same members and in many instances 

CFDA designers often work directly with or license their brand name to one or more 

of our members. Neither association wanted to back legislation that would make it 

harder to design apparel and footwear or give lawyers a hand in the design process. 

Third, there remains a deep misconception about the scope of the legislation. I 

want to be very clear on this point. ID3PA will not cover everything in the fashion 

world. In fact, it will cover only those original articles, which are so truly unique 

that they come closer to art than functionality. To put an even finer point on this, 

by definition, the bill states that nothing in the public domain—the collective works 

of thousands of years of fashion history—can be protected under this bill. 

Fourth, very few companies will have to worry about possible accusations of infringements. To infringe, an article must, among other things, be substantially identical to an original article. The ‘‘substantially identical’’ standard is tighter than 

what had appeared in the DPPA and is defined as so close in appearance that it 

94 

would be likely mistaken for the original. While this ‘‘substantially identical’’ standard may be easily met for many basic garments—the blue jeans or underwear in 

your dresser—it is a very high threshold when compared against never-before-seen 

fashion articles discussed above. 

We address a fifth misconception—that the new legislation will lead to frivolous 

lawsuits. ID3PA includes a heightened pleading process where the burden falls entirely on the plaintiff to plead with particularity before legal action can commence. 

In that pleading, the plaintiff must show: 

1) Facts that his/her design is original 

2) The potential defendant’s design is ‘‘substantially identical’’ to his/her design 

3) Facts stating that the defendant had some access to the design to have seen 

it, before making the infringing design 

A sixth misconception revolves around the lack of a searchable database. Frankly, 

we felt that a database—especially with the well documented problems associated 

with the Copyright Office—would only cause confusion. Searchable databases in use 

in other countries reveal registration for common items like plain white t-shirts. Designers can still assert originality by including a symbol on the article and can work 

to enforce those claims, but only if they can meet the high threshold established by 

the three-part pleading process. 

In closing, AAFA believes the ID3PA provides a targeted fix to the narrow design 

piracy problem. The legislation provides designers with a clear and easily understandable framework so they can enforce their own original designs. At the same 

time, it contains multiple protections to ensure that those same designers can seek 

inspiration and harness fashion trends without the chilling effect of frivolous lawsuits. 

Thanks again for allowing me this opportunity to speak and I look forward to answering any questions. 

Mr. GOODLATTE. Thank you, Mr. Courtney, for your very helpful 

testimony. We have since been advised that we may be extremely 

short of time. Votes may be called in a matter of 5 or 10 minutes. 

As a result of that, Ranking Member Watt and I have agreed to 

defer our questions. We’ll either submit them to you in writing, or 

if there is time at the end, we’ll come back to those. 

In light of that, we’ll recognize Members for 3 minutes a piece 

and see how many we can get through. We’ll begin the Vice-chairman of the Committee, the gentleman from Arizona, Mr. Quayle. 

Mr. QUAYLE. Thank you, Mr. Chairman. 

Professor Sprigman, I was just trying to—in your testimony, you 

were talking about back in the 1920’s and 1930’s, there has always 

been copying, and there has always been complaining about copying, yet the design community has continued to thrive. And trends 

become trends because of the copying. 

Now, in Mr. Hernandez’ testimony, he also stated that if you 

have, right now, because of the Internet and because of digital photography, that within minutes or within hours after a runway show 

or a red carpet in Hollywood, that that design can actually be put 

into production overseas within a matter of hours and actually 

make it to the streets prior to the designer being able to get his 

or her design out there. So do you think that now is the time to 

be able to put that forth because of the changing with the technology so that the designers can actually profit from their own designs? 

Mr. SPRIGMAN. I think speed of copying hasn’t really changed 

very much in 20 years. So I think the fax machine really changed 

speed of copying. You could take a photograph at a runway show 

and you could fax it. I think the Internet makes photos from fashVerDate Aug 31 2005 12:10 Sep 01, 2011 Jkt 000000 PO 00000 Frm 00098 Fmt 6633 Sfmt 6601 H:\WORK\IP\071511\67397.000 HJUD1 PsN: 67397
95 

ion shows a bit more available. But within the industry—Women’s 

Wear Daily runs a lot of photos. These things have been available. 

The industry has a 6-month lead time. All right. So they have 

shows in the fall for apparel that’s going to hit the stores in the 

spring, and shows in the spring for apparel that’s going to hit the 

stores in the fall. If the speed of copying was really a worry, we 

would see some pressure on that 6-month lead time that the industry has. We don’t see it. The 6-month lead time has stayed. 

Can I have the slides up again? I would like to have the last 

slide up. 

Mr. QUAYLE. Actually, one other question. Mr. Courtney was 

stating that he believes that the concise definition in the new bill 

is actually very concise and won’t lead to frivolous lawsuits. But do 

you agree or disagree with that? Because in your opening statement, you were stating that you believe this is going to increase 

litigation. 

Mr. SPRIGMAN. I disagree. Before I became an academic, I spent 

a long time as a lawyer. And I litigated a lot of intellectual property cases. The question in this bill is whether the garment that 

is the defendant’s garment is likely to be mistaken for the plaintiff’s garment. Most people who would be on a jury, most Federal 

judges, are not particularly attuned to fashion, not particularly interested in it. If a garment looks generally alike, I think in the run 

of cases likely to condemn it, we’ll get inconsistent verdicts. We’ll 

get lawsuits being threatened. We’ll get cease-and-desist letters. 

That is all going to, I think, redound to the detriment of the young 

designer, the new designer, who doesn’t have the money to fight 

this. 

Wells Fargo Bank recently, which loans a lot of money to the 

fashion industry, said in a statement a couple of weeks ago that 

they are worried about this bill because if this becomes law, they 

are going to have to check twice, they are going to have to check 

three times before they lend to a design firm that can’t indemnify 

them. And it is the small fry that can’t indemnify. So this will create barriers. 

Mr. QUAYLE. Thank you. 

Thank you, Mr. Chairman. 

Mr. GOODLATTE. The Ranking Member of the full Committee, 

Mr. Conyers, is recognized for 3 minutes. 

Mr. CONYERS. I want to beginning by thanking both you and Mr. 

Watt, Mr. Chairman, for your expediency in allowing us to question 

our witnesses. This is fascinating stuff here. 

The passion of Mr. Hernandez can’t be undervalued. 

I don’t agree with you, but you are very impressive in your testimony. 

What I am trying to find out is things are really going along. 

This is a booming industry right now. And I just want to ask Professor Sprigman, what other mischief might inadvertently be produced if this bill were to become law, sir? 

Mr. SPRIGMAN. I want to show you an example. Could I have a 

picture of those handbags up, please? It is a slide with two handbags on it. This is the mischief that I am worried about. 

So on the left, you have the Proenza Schouler PS 1 bag. This is 

the bag Mr. Hernandez talked about. On the right, you have the 

96 

Mulberry Alexa. The Mulberry Alexa appeared on the market before the Proenza Schouler PS 1. So, Mr. Hernandez says, Well, I 

create out of nothing. No. No one in the fashion industry creates 

out of nothing. People in the fashion industry create out of what 

happened in the past. 

The Proenza Schouler PS 1 has some substantial similarities to 

the Mulberry Alexa. I think in a world in which the ID3PA had 

been law, when the Proenza Schouler PS 1 came out, I think Mr. 

Hernandez could have found himself on the receiving end of a 

cease-and-desist letter. This is what I worry about. 

When I look at these bags, I see differences. I see a lovely bag 

being made by Proenza Schouler that was hot because it was very 

attractive. But a copyright plaintiff’s lawyer is going to see a potential settlement. And this is what I worry about. 

There’s some wedding dresses as well. Could you show those 

wedding dresses? 

Mr. CONYERS. As they say in our community, I get your drift. 

Mr. SPRIGMAN. I’ll leave it there. 

Mr. CONYERS. I am with you. 

I want to compliment Professor Suk for her testimony. 

We are always glad, of course, to see Mr. Courtney. 

I yield back. 

Mr. GOODLATTE. The gentleman from Pennsylvania, Mr. Marino, 

is recognized for 3 minutes. 

Mr. MARINO. I have no questions. 

Mr. GOODLATTE. Thank you. 

The gentlewoman from California, Ms. Lofgren, is recognized for 

3 minutes. 

Ms. LOFGREN. Just one additional question for Professor 

Sprigman. You have been very clear about the amount of litigation 

that could result. And what we want to do is take steps to promote 

a healthy economy and creativity and the like. So we want to get 

this right. I am from Silicon Valley, and one of the issues that has 

been of concern there—if you are an IP, you know this—is the 

issue of trolls, where you have got rights that are assigned and the 

only—really, the only thing that some of these firms do is they buy 

it so they can litigate. Do you see the potential for that in this 

arena? 

Mr. SPRIGMAN. I think the unfortunate truth here that is the 

ID3PA is going to give rise to copyright trolls. So think about it if 

you are a retailer. You can be held liable if you reasonably should 

have known that you are dealing in infringing garments. So the 

fashion industry puts out so many thousands of designs every year. 

This bill doesn’t create any kind of registry as a precondition for 

claiming protection. I could imagine a law firm going into business 

as a copyright troll, basically buying the right to litigate designs 

against department stores. And if you think about the department 

stores’ reaction to this, the idea of receiving a whole bunch of 

cease-and-desist letters every season, the department store’s reaction is going to be, I want indemnification. 

The big guys can live in that world. The little guys are going to 

be the ones that suffer in that world. That is what I am worried 

about—just raising the cost of doing business. If I thought that it 

was necessary to do this in order to get innovation in fashion, I 

97 

would say, Go for it. But we see a fashion industry that is about 

as innovative as it could be, and we see people at the high end of 

the industry raising their prices, profiting. There’s nothing to fix 

that I can see. 

Ms. LOFGREN. It seems to me, and then I’ll stop, that there is a 

legitimate trademark issue, because if somebody thinks they are 

buying a high-end product that is really a cheap knockoff, that is 

a completely different issue than this one. 

Mr. SPRIGMAN. That is fraud. 

Ms. LOFGREN. That is fraud. 

Mr. SPRIGMAN. We have a trademark law that helps in that case 

and, you know, enforce that. If people are defrauded, go after them. 

Ms. LOFGREN. Thank you, Mr. Chairman. I will yield back. 

Mr. GOODLATTE. Professor Suk, did you want to respond that 

that point about how this affects smaller designers? 

Ms. SUK. Yes, I did. Yes, thank you. I think that, for one thing, 

the new data that Professor Sprigman presented—first of all, everything is in the interpretation. And I believe that Christopher 

Sprigman’s interpretation of that data is incorrect. 

I would have an alternative explanation. When you are seeing 

high prices at the high end going up, why are rising prices at the 

high end considered signs of health rather than signs of splitting 

consumers so that you have the midrange designers in direct competition with the lower-end companies? And so, therefore, those 

midrange companies are less able to compete, and so then you have 

got the higher-end designers raising their prices. 

So if you have a $500 dress that is going away because of competition from copyists, then what is left is the higher-priced 

dresses. And in many ways, if you see just the high end going up 

like that, it can be interpreted as a sign of producer desperation 

rather than a sign of health by those designers. So I think that the 

interpretation is definitely up for grabs. I think it would be really 

helpful to have Professor Sprigman’s data rather than just his interpretation. 

Mr. GOODLATTE. Go ahead. 

Ms. SUK. As for the idea of different bags having similar looks 

and there being trolls, for many people who don’t know classical 

music, the difference between Bach and Handel, one piece of Baroque music is much like any other. It is true that for some people, 

whatever the industry, whether it is painting, whether it is books, 

poetry, you are going to have a problem that if you are not that 

attuned, you might think that it is all the same. But that is not 

unique to the fashion industry. There are meaningful differences 

between products that may look similar to some people. And it is 

because we care about innovation within this industry at the level 

of detail that the industry actually produces that we would have 

a law that says ‘‘substantially identical.’’ 

Mr. GOODLATTE. Thank you. 

I want to get to the gentlewoman from Texas, Ms. Jackson Lee, 

for 3 minutes. 

Ms. JACKSON LEE. Thank you very much, Mr. Chairman. 

And thank you to the Ranking Member for your courtesies extended. 

98 

Mr. Hernandez—and thank you, I was delayed in another meeting on debt ceiling issues. But I come to this Subcommittee with 

a great passion about creating jobs. 

Tell me how important and how do you define your work as a 

property right, as something to be protected so that you can create 

jobs and you can have a product that is protected? 

Mr. HERNANDEZ. Well, we employ about 50 designers at the moment, who sort of design products all day, every day. We are having the problem at the moment where a lot of our designs are being 

copied on a much more accessible price point level. And I think an 

interesting thing, interesting point that is being brought up today 

is this whole point of designers raising their prices really high. 

That is not so much a function of margins as it is a function of us 

having to keep on pushing the design level and pushing further 

and further and kind of pushing design and getting a little more 

experimental and having to kind of push the design level further 

and further and that brings the price point up. 

Ms. JACKSON LEE. And that’s because your product is stolen or 

redone or copied. 

I only have a short period of time. So I want to go to Professor 

Sprigman and just say that when we started out this in country, 

we copyrighted books and maps and charts. But we’ve moved progressively on, for example, into technology and otherwise. So what 

would be the aversion to, as this property is being demeaned, to 

not move in that direction if we had protections for those very entities of which you have just spoken? It is a valuable asset that fashion designers have. 

Mr. SPRIGMAN. It’s a valuable asset. My only argument and I 

think it’s the argument that the Framers of our Constitution made, 

we have copyright, we have patent to promote the progress of useful arts and sciences. 

The fashion industry has been promoting progress in beautifully 

clothing Americans for a long time without any copyright protections for its designs. Progress is being promoted through free competition. 

For reasons I explain in my academic work, the fashion industry 

doesn’t depend on property rights as the engine of innovation. 

Ms. JACKSON LEE. But change has come about, has it not? Paintings now are protected, and otherwise. 

Mr. Chairman, I’m going to yield back and just simply say I 

think we have a good product here, but I think we need take a 

great interest in the points the professor has made in protecting 

other elements. 

But we need to protect you, Mr. Hernandez. We want you to 

produce, produce, produce, create jobs, and be successful as an industry. 

I yield back. 

Mr. GOODLATTE. I thank the gentlewoman. 

We have about 5 minutes remaining in the vote that has been 

called. Does the gentleman—well, I’ll just ask one question. 

Mr. Hernandez, critics of fashion design protection argue that all 

fashion is derivative of something that came before it. They believe 

that unfettered copying actually drives fashion cycles and results 

in more creativity. So, two questions. Is that how it works? And to 

99 

the extent that it is, is that fair? And tell us how that connects to 

your own—— 

Mr. HERNANDEZ. I think, historically, most artists and designers 

are obviously inspired by history and things that have happened 

before that. I don’t think anyone is sort of speaking about that 

being a problem. I think that is a normal thing that happens 

amongst artists and designers. 

I think the problem is in someone copying, stitch for stitch, what 

you have already created. There is a difference and a very big difference between being inspired by something and copying something. And I think what has happened in the modern world is the 

advent of the Internet, as opposed the advent of the fax machine, 

for example, is that there’s Web sites now where you get a runway 

show, and they can literally zoom in to the garment front and back, 

copy stitch for stitch, and pretty much print it and make it in a 

couple days flat and ship it before we ourselves can even take orders on the product. 

And I think that’s something that’s happened in the last 10 years 

that has changed the game 100 percent. The protection hasn’t 

caught up to the level of technology. There’s been sort of a disconnect there. Before, it was a little more—we were a little bit 

more protected in terms of the product wasn’t as visible to so many 

people from such an early stage. Now it is. 

Mr. GOODLATTE. Thank you. Mr. Courtney, you believe that this 

bill has been substantially changed and improved to address it in 

the manner that Mr. Hernandez describes, maybe not literally 

stitch for stitch, but very close to that, in order to get the protection of the bill, as opposed to just general ideas and general trends. 

Mr. COURTNEY. Yes, thank you, Mr. Chairman. 

The thing to remember, as I said in my testimony, this is not intended to cover that anything that anyone is wearing right now in 

this room or anything that exists up until enactment of this bill. 

But we have to give designers the opportunity once this bill becomes law to, if they can meet the very tight definitions that are 

in the bill of originality, that is going to spur innovation. That is 

going to enable designers to come up with something that really is 

truly unique. If they are able to do that, then absolutely they 

should be able to get protection for that for 3 years. That is the 

reason why we are supporting this bill. We have eliminated as far 

as—— 

Mr. GOODLATTE. I am going to cut you short because I want to 

give the gentleman from North Carolina the last word. 

Mr. WATT. Thank you, Mr. Chairman. 

Let me apologize to the witnesses and to the Chairman for being 

late. I got consumed with this debt ceiling stuff that we were involved in and just lost track of time. So I apologize because I feel 

responsible for holding—getting us in the time bind that we are in. 

Ms. Suk, Professor Suk, I think you probably won’t be able to respond to this, except in writing. I practiced law for a long time before I got here, 22 years, and I am just trying to conceive of a set 

of jury instructions that you would give to 12 people sitting on a 

jury that defines clearly the distinction between inspired by—that 

is one term you used—and substantially identical. That is the other 

term you used. Could you give some thought to that at some point 

100 

and perhaps give me a written set of jury instructions? Because I 

think if we are going to respond to Professor Sprigman’s concern 

about increasing litigation, which could be a substantial deterrent 

to innovation—and I see that deterrence acting between small people like you, Mr. Hernandez, and large people who are already out 

there. I don’t want you tied up in protracted litigation against 

Louis Vuitton or whoever you are competing against. I guess you 

don’t compete against Louis Vuitton. Maybe you do. I don’t know. 

I don’t know enough about this industry. 

But that illustrates a point that I’m making because 12 people 

sitting on a jury are not going to know a darn thing about this industry either. You know the distinctions, and the proof in a case 

is going to rely on 12 uneducated, unsophisticated design people 

making those kinds of distinctions. And unless that can clearly be 

drawn, you’re just going to have endless litigation about this. And 

that’s the concern I have. And that litigation will be more—could 

be more of a deterrent to innovation or bringing things to the market because you’ll be just afraid that you’re going to get into the 

middle of litigation about these things. 

So this can’t be resolved right now. Maybe I should ask both the 

professors to think about that and give me their thoughts about it 

in writing. That would be very helpful. 

Mr. GOODLATTE. I thank the gentleman. And I thank all of the 

witnesses for their valuable testimony today. 

I apologize also for the Committee for the tightness of the time 

here, but we don’t control the action on the floor. 

Without objection, all Members will have 5 legislative days to 

submit to the Chair additional written questions for the witnesses, 

which we will forward and ask the witnesses to respond as promptly as they can so that their answers may be made a part of the 

record. Without objection, all Members will have 5 legislative days 

to submit any additional materials for inclusion in the record. 

With that, again, I thank the witnesses and the hearing is adjourned. 

[Whereupon, at 11 a.m., the Subcommittee was adjourned.] 

(101) 

A P P E N D I X 

MATERIAL SUBMITTED FOR THE HEARING RECORD

102 

Response to Post-Hearing Questions from Lazaro Hernandez, 

Designer and Co-Founder, Proenza Schouler 


67397D-1.eps
103 


67397D-2.eps
104 

f 


67397D-3.eps
105 

Response to Post-Hearing Questions from Jeannie Suk, Professor of Law, 

Harvard Law School 


67397E-1.eps
106 


67397E-2.eps
107 


67397E-3.eps
108 


67397E-4.eps
109 


67397E-5.eps
110 


67397E-6.eps
111 


67397E-7.eps
112 


67397E-8.eps
113 


67397E-9.eps
114 


67397E-10.eps
115 

f 


67397E-11.eps
116 

Response to Post-Hearing Questions from Christopher Sprigman, Professor of Law, 

University of Virginia School of Law 


67397F-1.eps
117 


67397F-2.eps
118 


67397F-3.eps
119 


67397F-4.eps
120 


67397F-5.eps
121 


67397F-6.eps
122 


67397F-7.eps
123 


67397F-8.eps
124 

f 


67397F-9.eps
125 

Response to Post-Hearing Questions from Kurt Courtney, 

Manager, Government Relations, American Apparel & Footwear Association 


67397G1-2.eps
126 


67397G1-3.eps
127 


67397G2-1.eps
128 


67397G2-2.eps
129 

f 


67397G2-3.eps
130 

Letter from Stephanie Lester, Vice President, International Trade, 

Retail Industry Leaders Association 


67397H-1.eps
131 


67397H-2.eps
132 

f 


67397H-3.eps
133 


HR2511-1.eps
134 


HR2511-2.eps
135 


HR2511-3.eps
136 


HR2511-4.eps
137 


HR2511-5.eps
138 


HR2511-6.eps
139 


HR2511-7.eps
140 


HR2511-8.eps
141 


HR2511-9.eps
142 

Æ 


HR2511-10.eps