To Copy or Not to Copy, That is the Question: The Game Theory Approach to Protecting Fashion Designs
affiliation not provided to SSRN
March, 27 2012
University of Pennsylvania Law Review, Vol. 160, p. 1139, 2012
Fashion designers in the United States, unlike those in many foreign jurisdictions, enjoy only limited intellectual property protection for their creative endeavors. The American patent, copyright, and trademark systems each present obstacles to obtaining protection for fashion designs. Copyright and trademark law protect certain elements of fashion designs, such as unique fabrics and logos, but the protections do not extend to the general shape and appearance of a fashion design. Moreover, copyright and trademark law do not grant protection to products and features that serve a utilitarian purpose. On the other hand, patent law presents difficult statutory barriers; a design must be novel and nonobvious, and can only gain protection after a lengthy litigation process. The result is a gap in intellectual property protection that leaves fashion designers vulnerable to a stitch-by-stitch, seam-by-seam replication of the designs they labor to create.
While the duplication of fashion designs is not a new phenomenon, the practice has recently received increased attention due to high-profile lawsuits by famous designers including Anna Sui and Diane von Furstenberg against low-end, mass retailers such as Forever 21. The defendants in these cases are known as “fast-fashion” firms for their ability to replicate original designs at alarming speed, on a large scale, and at low cost. Many fashion designers disapprove, claiming that fast-fashion firms’ capabilities of quickly copying original designs and bringing those copies to market deprive original designers of profits and stifle design firm creativity. The fashion industry, represented by the industry group Council of Fashion Designers of America (CFDA), has sought Congress’s assistance to rectify the longstanding dearth of intellectual property protection for fashion designs. The Senate introduced a proposal to amend the copyright statute known as the Innovative Design Protection and Piracy Prevention Act (IDPPPA) last session, and the House of Representatives recently introduced the same proposal.
In this comment, I address the normative question of the optimal scope of intellectual property protection for fashion designs through game theory’s unique perspective of law and economics. I do so by developing a game theoretic model that evaluates the impact of greater legal protection on the incentives of fashion designers to bring lawsuits to protect their designs and of fast-fashion firms to make replicas of these designs. Analyzing the incentives at play will allow me to predict whether the IDPPPA in its current form will deter fast-fashion firms from replicating designs, encourage innovation, and maximize welfare in the fashion industry.
Part I of this comment offers a detailed overview of the current state of intellectual property protection for fashion designs in the United States and compares U.S. protection with the legal regimes of foreign jurisdictions. Part II discusses the recent developments in the fashion industry that have triggered an outcry against copying and summarizes the scholarly views on the normative question of which legal regime, if any, should exist for the protection of fashion designs. Part III provides background on the law and economics approach to intellectual property protection and explains the relevance of game theory, a law and economics tool, to the analysis of copying fashion designs. Part IV lays out the assumptions and the structure of a game theoretic model and applies this model to different legal regimes aimed at protecting fashion designs. Finally, Part V examines the findings of the game theory analysis in Part IV, evaluates the efficacy of the Innovative Design Protection and Piracy Prevention Act as a policy choice, and introduces possible alternatives.
Number of Pages in PDF File: 55
Keywords: Fashion, Fashion Design, Fast Fashion, Innovative Design Protection and Piracy Prevention Act, IDPPPA, ID3PA, Intellectual Property, Copyright, Game Theory, Law and Economics, LawAccepted Paper Series
Date posted: March 28, 2012
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