Piracy is not just a problem on the high seas or the internet: fashion designers have fallen victim, too. Current copyright laws protect only the artwork of a design, such as labels, logos, prints and embroidery. Leave off the label or change the logo slightly, and manufacturers and copy-cat designers have free reign to duplicate the cut, shape, style, and silhouette of an item of clothing or an accessory. This widespread practice of design piracy by popular retailers is legal…for now.
Under current copyright law, the practical difference between a pirated copy and a counterfeit is very slight. Designer Diane von Furstenberg told the LA Times that design piracy is essentially "counterfeiting without the label." The Design Piracy Prohibition Act, a bill that would amend the Copyright Act and is currently pending in the Senate, would extend protection to the appearance as a whole of an item for three years.
If the bill passes, it could have a profound practical impact on the way the fashion industry operates in this country. Trends on the runway trickle down through all levels of retail, until they end up in every closet in America. If it were illegal to imitate high fashion trends, lower-tiered retailers and designers would have to draw inspiration from somewhere else. And if they do not, the bill may only spawn more litigation over whether a design is an exact pirated copy without the label, or merely inspired by a major fashion trend in the industry.
Both designers and scholars in Los Angeles have articulated the paradoxical concerns design piracy implicates: on the one hand, copying propels trends forward, promotes creativity in the industry, and democratizes fashion; while on the other hand, a pirated design can be so close to the original that it can wreak all the financial havoc on a company that a counterfeit design could.
Selling pirated or counterfeit goods is big business, and it not only impacts the elite international fashion houses such as Gucci and Chanel, but it also hits premium Southern California denim and sportswear brands such as Ed Hardy and 7 For All Mankind. For example, counterfeiting costs Ed Hardy an estimated $20 to $25 million per year in global sales. Counterfeit footwear, clothing and handbags valued at $62.89 million accounted for 57% of all seizures made by U.S. Customs from October, 2006 to March, 2007 alone. That is over a 200% increase over the same period the previous year, and more than half comes in through the ports of Los Angeles and Long Beach.
Some of these companies are fighting back with more than cease-and-desist letters—they are hiring private investigators to pursue leads, build cases, and document and compile evidence to arm law enforcement and prosecutors with all they need for an arrest and a conviction of the offenders. This is necessary because sellers of pirated and counterfeit goods will organize covert "purse parties" in someone’s home, or set up a meeting in a Starbuck’s parking lot to conduct a quick transaction out of the trunk of their car, making it hard for local law enforcement to keep up. If the Design Piracy Prohibition Act passes next year, fashion companies will be armed with one more tool in their toolbox with which to help protect their designs and their profits.