On April 26 the New York State Supreme Court, New York County, dismissed all claims in a million dollar lawsuit brought by the Graphic Artists Guild (GAG) against the Illustrators’ Partnership of America (IPA) for statements and actions alleged to be defamatory regarding the collection of “orphaned fees.” Here is a statement from the IPA:
In the lawsuit, GAG asserted claims for defamation and interference with contractual relations, alleging that IPA had interfered with a “business relationship” GAG had entered into that enabled GAG to collect orphaned reprographic royalties derived from the licensing of illustrators’ work. GAG alleged that efforts by IPA to create a collecting society to return lost royalties to artists “interfered” with GAG’s “business” of appropriating these orphaned fees.
In her decision, Judge Debra James ruled that statements made by the Illustrators’ Partnership and the other defendants were true; that true statements cannot be defamatory; that illustrators have a “common interest” in orphaned income; and that a “common-interest privilege” may arise from both a right and a duty to convey relevant information, however contentious, to others who share that interest or duty.
Regarding a key statement at issue in the lawsuit: that GAG had taken over one and a half million dollars of illustrators’ royalties “surreptitiously,” the judge wrote:
“Inasmuch as the statement [by IPA] was true, [GAG]’s claim cannot rest on allegations of a reckless disregard of whether it was false or not. Truthful and accurate statements do not give rise to defamation liability concerns.”
GAG wrote on their website:
On April 26, the Guild filed a notice of appeal in the dismissal of the defamation lawsuit filed in the Fall of 2008. The Guild strongly disagrees with the judge’s ruling in this case. For clarification purposes, the lawsuit is a defamation lawsuit regarding statements made by the defendants named in the lawsuit. It has no connection to the Orphan Works bill of 2008, or the Google class action lawsuit. Our statement on the notice of appeal can be downloaded here. An informational article on reprographic royalties can be read in our archived news.
I asked Brad Holland, one of the IPA defendants in the case, to discuss the outcome:
GAG made bold accusations. Where do they stand now? Nowhere. The judge threw them all out.
Has GAG responded to the ruling yet? We’ve heard they plan to appeal.
Does that surprise you? No, we assumed they would. And I’m sorry to see that they’re still making the same allegations in public that the judge dismissed.
What does an appeal mean for you and the other defendants? We can’t let ourselves get bogged down by it. The judge’s ruling was pretty sweeping. She accepted all GAG’s motions and allegations and emphasized that she gave them “every possible favorable inference.” That means they can’t say they didn’t get a fair hearing. I’m sure they’ll find some excuse to appeal; but if they do, I’ll see it as a measure of how desperate they are to keep taking artists’ royalties.
Having won the case, has the stress subsided? What I hope subsides is the cold chill that’s hung over our industry since this manufactured controversy began. Artists have a right to know where these royalties are coming from and what’s happening to the money. For GAG to tell us it’s “nobody else’s business” ought to be a big red flag.
So what was the emotional cost of the lawsuit? It was an enormous waste of time and money and an emotional and physical drain. But in my opinion, the greater cost is what’s been borne by all those artists who weren’t sued, but who learned that they could be if they ever spoke out or asked questions themselves. I hope the judge’s decision will start to dispel that climate of fear.
What has this case taught you about law and litigation that you did not know before and will never forget? The principle at stake here is greater than the lawsuit. Reprographic royalties represent an ongoing stream of income. The stream is growing larger by the year. It comes from the work of individual artists but it’s collected under blanket licenses. That means it’s like jukebox money; you need a specific business model to distribute it fairly. That’s not impossible; other countries do it and we’ve got 12 organizations working together to try doing it here. We’ve got the approval of the IRS. We’ve repeatedly invited GAG to work with us. I think it’s unfortunate that they decided to sue us instead.
You are a self-made illustrator, and now a self-made lawyer? No, I’ve been practicing art without a license for 40 years; I don’t think I’ll push my luck by practicing law without one.
(Legal documents below courtesy Brad Holland – click on image to enlarge. Illustration by Brad Holland)