Art Business News
Withholding a Work is Not Infringement
U.S. DECIDED-- Richard A. Frasier v. Adams-Sandler, Inc. et al (4th U.S.
Circuit Court of Appeals, 95-1806, decided August 23, 1996).
The court held that depriving a copyright holder from access to his work
is not an infringement of copyright. Infringement only occurs when someone
"reproduces, prints or makes use of copyrighted
material." The plaintiff, a photographer, claimed copyright infringement
after giving slides to the defendant that the defendant held for three years
before finally returning them. The plaintiff claimed that by withholding
the images from him, he could not exercise his own exclusive rights under
the
copyright law. However, as the panel of the court pointed out, the plaintiff
could not quote any authority for this interpretation of the copyright laws.
The decision is available at
http://www.ljextra.com/cgi-bin/f_cat@prod/ljextra/data/external/9608278.c04.
Canadian On-Line Content Liability Study
Although court cases have dealt with the issue of content-related Internet
liability, Canadian and U.S. copyright statutes have not yet legislated
solutions to this issue. The Canadian government has recently commissioned
four consultants to undertake a consultation process on this issue and to
provide a written report by early 1997. The report will discuss information
controls, privacy issues and the protection of works and policy models in
Canada and other OECD countries. It will discuss liability for Internet
service providers, Bulletin Board Services, newsgroups and other related
services and pornography, hate propaganda, defamation and privacy of confidential
information, copyright and intellectual property. The study assumes that
liability is possible on the Internet. According to the study's terms of
reference, its priority is to examine "who is or should be liable"
and to describe the environment and issues in relation to liability and
not to make recommendations for policy, legislative or regulatory changes.
To be on the mailing list for the final report, e-mail LEDUC.PIERRE@ic.gc.ca.
[ABM is on mailing list for this report and will report on findings as they
are available].
The above two news notes are courtesy of Copyright and New Media Legal
News, Vol.1, No. 2 (Sept. 15/96). Editor Lesley Ellen Harris practises
Copyright and New Media Law and is the author of the book "Canadian
Copyright Law (Toronto, McGraw-Hill Ryerson, 1995). Ms. Harris can be reached
at copylaw@interlog.com and at http://www.mcgrawhill.ca/copyrightlaw
Canadians say OK to arts funding cuts
A study by Insight Canada Research indicated that 55 percent of Canadians
polled believe that the Federal government should cut funding of arts, sports,
entertainment and fashion events. 1,688 people aged 19 or over were phoned
between Sept. 11 and 15. The study was commissioned by the Alliance for
Sponsorship Freedom, a lobby group in favour of tobacco sponsorship. The
Globe and Mail (Sept. 20/96) reports that 84 percent of people polled believe
that "companies operating a legal business enterprise in Canada should
be allowed to sponsor" events. Tobacco advertising was banned in 1989.
Since then, such tobacco companies as Du Maurier have put their money into
sponsorships. Available money has spawned events, programs and even buildings
that now rely onese companies for some portion of their budgets, reports
the Globe.
Cuts continue to culture and heritage
groups
After a lull in news about cuts to culture and heritage groups, it is more
of the same. The Globe and Mail reports (Aug. 29) that the Ontario Museum
Association lost 33 per cent half way through their fiscal year. A reduction
in its grant from the Ontario Ministry of Citizenship, Culture and Recreation
from $179,777. to $120,450. The Multicultural History Society of Ontario
lost 53 per cent of its provincial $637,400. grant. The Timmins Museum,
National Exhibition Centre recently lost 34 percent of its funding fom th
Ontario Arts Council.
Director of cultural programs at the provincial Ministry said that the cuts
come out of last spring's 40 percent cut to the $1.47-million heritage organisations
program.
A total of 14 Ontario groups are affected by this particular round of cuts.
Canadian Artists and Producers Professional
Relations Tribunal certifies artists' associations
Courtesy Copyright and New Media Legal News from the law office of Lesley
Ellen Harris, copylaw@interlog.com and http://www.mcgrawhill.ca/copyrightlaw
This relatively new federal tribunal certifies artists' associations to
give them the exclusive right to bargain with producers in the federal jurisdiction
and to enter into scale agreements setting minimum terms of engagements
for independent (self-employed) professional artists. The Tribunal has certified
several artists associations to date: UNEQ; SARDeC; Canadian Actors' Equity
Association; Association quebecoise des auteurs dramatiques; CAPIC; SPACQ;
and PWAC. The decisions are available at: http://homer.ic.gc.ca/capprt/.
Copyright Reform in Canada
Courtesy Copyright and New Media Legal News from the law office of Lesley
Ellen Harris, copylaw@interlog.com and http://www.mcgrawhill.ca/copyrightlaw
Many interest groups view copyright law reform in Canada as a slow, frustrating
process. The amendments to the Canadian Copyright Act introduced in the
House of Commons on April 25, 1996 have been anticipated for over eight
years. In fact, these so-called "Phase II" amendments complement
the "Phase I" amendments passed by Parliament in 1988.
The proposed changes include: rights to provide royalties to producers and
performers of sound recordings; a levy on recordable, blank audio media
such as cassettes and tapes, to remunerate creators for private copying
of their musical works; provisions to give exclusive distributors of books
in Canada greater protection in the Canadian market; certain exceptions
from copyright laws for non-profit educational institutions, libraries,
archives and museums, and people with perceptual disabilities; updating
certain antiquated provisions; and phasing out perpetual protection for
unpublished works.
Many of the issues in the proposed law are contentious as were the issues
in Phase I. The Phase I bill took 13 months of discussions and hearings
in the House of Commons and the Senate prior to it being passed. It is unlikely
that Phase II will be made into law prior to significant debate. Notwithstanding
this fact, the Canadian Heritage Committee chaired by Clifford Lincoln plans
to begin hearings on Bill C-32 commencing the week of October 7, 1996 and
plans to complete these hearings by November 15, 1996. Following the Committee's
Report to Parliament, the Bill will then be referred to a Senate Committee
for study.
The proposed law makes no explicit attempts to deal with copyright law issues
as they relate to the Information Highway including the Internet and other
forms of new- and multi-media. The government maintains the position that
the next phase of copyright reform will deal with digital media issues however
there is no indication that the government is currently moving ahead with
the next phase of legislation. (Perhaps discussions at the WIPO level will
encourage the Canadian government to move ahead on this initiative.) It
is important to note that many of the provisions in Bill C-32 are technology
neutral and will be applicable to digital media whether or not such application
was intended by the legislative drafters.
The proposed law will amend the Canadian Act which, subject to amendments
was enacted in 1924, and based on the U.K. Copyright Act of 1911. During
the eight year period between the two phases of copyright reform, the copyright
law was amended from time to time, in order to comply with the Canada-United
States Free Trade Agreement and the North American Free Trade Agreement
and The General Agreement on Tariffs and Trade (GATT). The definition of
"musical works" was amended by Bill C-88 and certain administrative
provisions were amended by the Intellectual Property Improvement Act.
[Copyright and New Media Legal News is distributed for free by the law office
of Lesley Ellen Harris. Information contained in the above should not be
relied upon or considered as legal advice. Copyright 1996 Lesley Ellen Harris.]
The Canadian Heritage Collection: using art
as a tax shelter (Aug.18/96)
Capital Vision Inc. is a Toronto firm that puts together tax shelters. The
Globe and Mail reported this past April, that Capital Vision is marketing
the sale of serigraphs and lithos at $300. each for a tax savings of $700.
when the print is donated to a charitable institution. The art, owned by
Toronto entrepreneur Harold Blick, was originally commissioned by the federal
government during WW II. It is unclear who actually created the prints but
they are based on well known Canadian paintings by such artists as Tom Thomson
and Emily Carr. The war-time project was directed by A.J. Casson. Each print
is signed by Casson. The prints are currently selling at auction for $150.
to $300.
Money managers in Canada are selling the prints for Capital Vision with
some success. Part of the success may be the result of the recent increase
by the federal government on the limit of a year's charitable credit to
50% of net income; many people can claim the credit in one year. As well,
Capital Vision will return the investor's money if a charity has not taken
the print(s) within 30 days. Adding to the comfort level for purchasers
are assurances that there are a number of charitable insitutions that will
likely take the prints. However, there are no institutions with arrangements
to that effect. An institution which does take a print(s) can do so without
involvement of the Cultural Property Review Board since the prints are not
going to public institutions. And the pre-established $1,000. value, writes
the Globe and Mail's Bruce Cohen, "fits just inside the zone where
charities can value gifts on their own." But what is the incentive
for charities? This question is not answered in the information Art Business
received from a money manager in Alberta.
One does not get something for nothing. And it is a fundamental rule that
you can't write off something that you have not paid out; despite recent
changes to the tax rules. Ask a few questions. Will Revenue Canada sustain
the charitable tax number (not all charitable institutions have tax numbers)
of the receiving institution? Will the charity be around by the time you
file your return? Be aware that Revenue Canada has three years review your
return, after it has been initially assessed. In Tax Law, the onus is on
the taxpayer to prove that the tax department is wrong.
The Ontario government "business plan"
for the Ministry of Citizenship, Culture and Recreation
The Ontario government's "common sense revolution" continues with
strong support for the Conservative Premier, Mike Harris. Accompanying regular
financial cuts to all ministries is the implementation of "business
plans". While there are concerns over whether the imposition of a business
model on government is appropriate, the government has shown no hesitation
over its agenda. The Premier is currently enjoying strong approval of his
performance by voters. According to an Insight poll, the Premier has a 7.7
rating on a scale of 1-10 among those polled.
The business plan for the Ministry of Citizenship, Culture and Recreation
is reported as containing aims, outcomes and measurements of performance:
1) Aim: promoting access to, encouraging and protecting the
arts and heritage of Ontario.
Outcome: Self-reliant and financially stable local and provincial arts and
heritage organisations.
Proposed measurement of performance: measure support to arts and heritage
organisations from non-governmental sources.
2) Aim: maximizing the economic vitality of Ontario's cultural industries
through a sectoral development approach.
Outcome: stronger, more cohesive cultural industries sector contributing
to Ontario's economic growth.
Proposed measurement of performance: measure economic activity of cultural
industries.
3) Aim: coordinating a province-wide library system.
Outcome: enhanced service capacity of individual public libraries.
Proposed measurement of performance: measure percentage of libraries using
on-line systems.
Round Table: Some Toronto artists ponder
the art system and decide what to do next
Is there a market for art in Canada? Ask Drew Harris, a Toronto-based painter,
and he will tell you that there is -- it is a matter of reaching it.
Harris invited a small number of artists concerned with the problem of reaching
their market(s) to join him in a round table discussion in Toronto on July
14/96. His specific reasons for issuing the invitation include: to share
experiences on the common problem of reaching a Canadian market for art;
to discuss a common discontent with the commercial gallery system in Canada;
to learn more about how to use the mass media to improve your business;
to share in the energy only a collective body can provide; to make available
an opportunity to enter the Asian market. Mr. Harris has, with some energy,
established himself in the Asian market and sold 85% to 100% of several
exhibitions held at two galleries there.
A professional artist who has been in the business for many years cannot
sell his art for peanuts at local fairs, states Harris. It is a matter of
integrity. Rather, the seasoned artist may set his sights on a corporate
market -- but this market is not large enough to support all professional
Canadian artists. Hence, the interest in foreign markets. In either market
it is hard work. The artist must do a lot of "hand shaking and kissing
babies," warns Harris. Like any business, selling your own art takes
committment and networking, among many other things --including a knowledge
of what the mass media can do for you.
Another participant in the round table, Vince Mancuso, is a painter actively
experimenting with the mass media to get exposure for himself and visual
art in general. Although accused by peers of creating spectacle, Mancuso
reasons that the artist should use his ingenuity and all available tools
to reach his audience -- Mancuso's aim appears to be more about bringing
art back into everyday life (which from Bauhaus to Pop has yet to occur)
than making big dollars for himself. However, a reputation for high energy
and imagination will undoubtedly bring in business. Mancuso recently appeared
on City TV in a 15 minute spot during which he sponged a program host, Anne
Rohmer, with blue paint and printed her image on large sheets of watercolour
paper. Admittedly, he stole the idea from Yves Klein but it not only excited
and pleased the audience it also made money for a charity when the finished
prints were sold at an auction.
In all, important conclusions which participants must have come away with
are: take control of your own promotion, and hustle like crazy. Don't rely
on the commercial galleries to do it all, it is your art business.
McMichael Canadian Art Collection: seed donors
sue the Province of Ontario.
The Globe & Mail's report "Whither the McMichael gallery?"
suggests that "One question raised by the case of The McMichaels v.
Her Majesty the Queen in Right of Ontario is: Who says what is Canadian
art?" ABM would suggest that this may not be the appropriate question
to pose in this case. Rather, the issue is: what is the McMichael gallery
going to collect? While the art museum is a central player in the art system,
it is the artist who decides what art is, since he is the one who makes
it. The museum decides only what is shown in and collected by the museum.
And this, is a political arena affected by its biggest sources of revenue
-- government, sponsors and donors. This latest problem for the McMichael
gallery, a crown corporation owned by the Province of Ontario, will not
warm the hearts of its clients. It is a situation which, in the end may
be paid for by tax payers.
The McMichael Canadian Art Collection in Kleinburg, Ontario, Canada, began
as the home of Robert and Singe McMichael. This home, which they called
"Tapawingo", plus 14 acres of land and 194 works of art, they
donated to the Province of Ontario 31 years ago -- but not without a catch.
In an original 1965 contract with the Province, the McMichaels were promised
specific privileges. Among these privileges, they were assured lifelong
residency and final burial at Tapawingo and, significantly, a strong influence
over the growth of the collection. This influence is made clear in the original
contract which reportedly states that the collection must continue to reflect
the cultural heritage of Canada, limited to "works of art specifically
designated". These are works by six Group of Seven members, Tom Thomson,
Emily Carr and David Milne. A gallery advisory committee can include other
artists. And, significantly, it is a committee on which the McMichaels are
guaranteed two of five places. The McMichaels allegedly contend that the
gallery is taking a direction out of keeping with the spirit of the 1965
contract, and they are suing.
The gallery has grown in size and complexity since 1965. It now has a total
of 5,635 works and boasts a budget of $6.4-million a year; $2.7-million
comes from the Province. As well, since the original deal, a 1972 act, a
1982 McMichael Canadian Collection Amendment Act, and another 1989 amendment,
have been passed by the Province -- all with assurances, allegedly, that
the original agreement would be honoured. Government Legal Counsel for then
Ontario Premier Robarts was Richard Rohmer who helped draw up the 1965 deal.
Rohmer explains in the Globe article that the government was swimming in
unknown waters.
It is now up to the courts to decide.
Art Bargains -- the $4.5-million Horne collection
up for sale
Controversy surrounds the impressive collection of contemporary art once
owned by wealthy Toronto stockbroker Christopher Horne. According to a Globe
& Mail report (June 22), Horne quit his job with RBC Dominion Securities
and its parent, the Royal Bank of Canada in July, 1994 and in March, 1996,
he was charged with fraud and theft. Allegedly, Horne used money from some
clients' portfolios to furnish a $4.5 milion art collection. Now forced
into receivership, Horne's collection of paintings, photographs, and sculptures
has been seized by Coopers & Lybrand, appointed by courts to liquidate
his assets to payback creditors. The disposal of such a large collection
was bound to cause waves of contention in the art market.
Sharon Liss has been hired by Coopers & Lybrand to dispose of Horne's
art collection containing 72 paintings by such artists as Henri Matisse,
Francis Bacon, Marsen Hartley, Henry Moore, Paul-Emile Borduas, Betty Goodwin,
Paterson Ewen, David Milne and Yves Gaucher. Liss is sensitive to the damage
which may be caused by the sale of high ticket items at bargain prices.
Liss approached some Canadian dealers to form a sydicate to buy back paintings
by artists they represent in order to maintain the high prices they place
on the works. Many have refused saying that they lack the money to participate.
Some pieces of the collection are being sold through a silent auction. It
is reported that pieces are also being sold to whoever wants to buy.
Critics of Liss say that the silent auction has allowed sales of art to
go at well below market value, depressing the market for Canadian contemporary
art. The only mention of price by the Globe and Mail was that of a painting
by American Marsden Hartley. His 1936 Church on the Moors, Nova Scotia,
appraised in 1988 at $224,000, was reportedly sold from the Horne collection
for $70,000.
Also involved in the sales is Fela Grunwald president of PADAC (Professional
Art Dealers Association of Canada). Ms. Grunwald, an art consultant, is
reported to be selling pieces of the collection to her own clients. This
has angered some dealers who believe that the president of the association
created to protect them is undermining their businesses -- the implication
again being that the Horne artworks are being sold at bargain prices.
Critics abound but some like Miriam Shiell director of the Mirian Shiell
Gallery, Toronto, see the sale as a sign of an active secondary market.
It may also be a sign that a strong primary market exists but prices are
rudely inflated beyond what even wealthy Canadians are willing to pay. Chris
Varley, the appraiser hired by Coopers & Lybrand, believes that "Ultimately
what something is worth is what you can get for it."
Canadian readers may recall the scare dealers had in 1991 when Lavalin Inc,
a Montreal engineering firm, was forced to sell its assets to pay debt.
Because its collection consisted of 1300 pieces of largely Quebecois art,
the provincial government stepped in. The government provided the Musée
d'art contemporain in Montreal with a loan of $5.4 million to purchase the
art and keep it in Quebec. In the instance of the Horne collection, there
is no reason to involve the government.
