“What Keeps Fashion’s In-House Counsel Awake at Night?”

Audience Photos: Laurel Marcus

Fashion Week is always a good time to check in with Professor Susan Scalfidi Fashion Law Institute at Fordham University. On Friday morning I did just that with “Inside Out 4,” a breakfast panel featuring seven seemingly bright-eyed lawyers discussing the invigorating question: “What Keeps Fashion’s In-House Counsel Awake at Night?” Undoubtedly these individuals often forgo their beauty rest due to a number of worries.
Some examples of these include new and ever-changing technology (cybersecurity, A.I. for instance); complying with advertising regulations; securing customer privacy and big data; and the levying of international tariffs.

Others mentioned additional obstacles to getting some “shut-eye:” YouTubers posing as content creators, often in direct conflict with digital or print media; constantly trying to avoid missteps involving cultural appropriation; “inspiration” vs. copying issues; violations of copyrights on fashion and art; liability issues from loan agreements regarding fragile works of art or fashion; and class action wage lawsuits involving things as simple as employee bag searches which occur before time clocks are punched. Whew! I’m exhausted just listing these items.

Panelists from left to right: Professor Susan Scafidi, Fashion Law Institute; Paula L. Barnes, Senior Counsel, Macy’s; Jeffrey Hellman, Vice President and Assistant General Counsel, PVH; Angela Byun, Executive Account Director and Asia-Pacific Business Development, Conde Nast Style Division; Derek Morales, Brand Protection Counsel, Ralph Lauren; Cristina Del Valle, Senior Associate General Counsel, The Metropolitan Museum of Art; Any Lamberti, Associate General Counsel, The Metropolitan Museum of Art; Grace Fu, Executive Vice President of Human Resources, General Counsel and Secretary, Barneys New York.

It was interesting to hear from a variety of in-house counsel. Running the gamut from a vast, moderately priced department store, a high-end specialty store, a 128 year-old publishing house trying to adapt to the digital age, a large conglomerate that owns major fashion labels, a famed art museum and to a well known and iconic fashion brand – the last independent standing of the original three known as Donna (Karan), Calvin (Klein) and Ralph (Lauren). It seems the polo pony won the long distance race!

Since all participants asked to be off the record, I will give a brief description of a few of these sleep defying, non-billable hour issues without attribution. On the subject of tariffs, if you manufacture in Asia (specifically China), this becomes important as does cybersecurity. One panelist spoke of the three different kinds of people: “Those who have been hacked, those who are going to be hacked and those who don’t yet know that they’ve been hacked.” If you think, perhaps it’s not worth manufacturing in China, there are other things to think about – what if pulling your company’s manufacturing out of an area leaves workers without a job?

As far as those pesky YouTubers – they are often in violation of advertising rules with content that is sponsored but doesn’t say so or that hasn’t been fact-checked. A publishing company hoping to maintain its content integrity as well as ensure its relevancy with Millennials and Gen Z’ers is walking a risky tightrope. Gender fluidity, multiculturalism, and diversity have changed everything as has the constant need to guard against cultural appropriation gaffes while still pushing boundaries. On the plus side, one panelist spoke of witnessing a bit of an “influencer” fatigue for those dressed head to toe in a particular brand – the reader is on to them and doesn’t appreciate that they are becoming more commercialized. Spurred on by the idea that people will pay for quality content as evidenced by Netflix, Hulu, and Amazon Go, Conde Nast plans to put content behind a paywall by the end of the year so enjoy your free subscriptions now.

Where does inspiration end and copying begin? This is the question that many fashion houses must ask themselves both in offense and defense of their brands. In these days of the “call-out culture” (Diet Prada, anyone?) a fashion influencer or blogger can make an incident go viral (known as the “Consumer Police”) leaving the brand that’s been accused of copying forced to play catch-up. “Inspired by” is a very broad term – brands must be aware of where the original content came from. Many think that the term “Vintage” is a free space on the board — just because something’s old doesn’t mean it’s not still under copyright protection.

“But Google it – – it’s everywhere” also doesn’t fly since sites such as Pinterest and Instagram could just be sharing a look which is not the same as actually using it in a design. Even prints, patches and small stickers are subject to copyright claims – in fact, the “deep pocket theory” of litigation could come into play in which a smaller company will choose to enforce against the highest profile, most profitable brand if it appears that they’ve been copied. Although there is technically no copyright in fashion, some things like patterns are protected, prompting Scafidi to humorously ask if the panelist was now a proponent of monochromatic fashion. In another effort to keep copiers at bay, Ralph Lauren has changed to a “see now buy now” formula – clothing in last Thursday’s show is already available online.

Museums face various licensing, publishing and digital initiatives as they are beginning to push out more free content in the hopes that their artwork can inspire fashion and new art. Some works have rights associated with them while others in the public domain do not. Through Wikimedia and the museum’s own websites, these institutions are hoping to share this information with the public to help the creative process. Museums also face concerns when loaning art or fashion. The standard insurance limited liability loan agreement contract can balloon into huge riders if lenders can’t agree on what constitutes minor repairable damage and what entails claiming a total loss. For instance, should a sequin fall off of a garment some lenders want to declare the item a complete loss? Of course, if an item disappears in transit, that is a legit claim. It’s important to clarify who will take responsibility and whose insurance must pay.

Lastly, continually changing labor laws are making defendants out of Nike for doing bag checks just before an employee clocks in and Apple for auditing and retrieving company cell phones of off-duty employees. Apparently, this has set a precedent for hourly workers to feel it is unfair that they are subject to a bag check when technically they are off the clock (the average bag check takes about 18 seconds) stating that they should be compensated for that time. Other large stores are exposed to litigation for this, as well as for sales associates who are selling in their off time on Instagram or through their own cell phones, which also raises privacy concerns. It’s something to think about the next time the helpful salesperson at your favorite store texts you about the new merchandise they just got in or the sale they are having next week!

Laurel Marcus

OG journo major who thought Strunk & White's "The Elements of Style" was a fashion guide. Desktop comedienne -- the world of fashion gives me no shortage of material.

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