“I think any artist working now has to take advantage of the technological advances . . . and use them creatively.” – Keith Haring
Most lawyers will readily admit that sometimes, the law is slow to adapt. Especially in the United States, with separate but coexisting branches of government, the division of powers between federal and state governments, and a primarily two-party political system, combined with bureaucracy, lobbying, and disjointed priorities, legislation often falls behind the times. So, when legislative efforts stall, creative solutions must be implemented to effectuate goals that legislation has failed to accomplish.
Consider the case of Artist Resale Royalty Rights. Artist Resale Royalty Rights guarantee to visual artists a percentage of the increase in value upon resale of their artwork. These royalties have existed in France, as a part of its copyright law, for over a century. The UK and EU countries were required to implement the right by 2006. Now, over 70 countries have legislated royalties. Not so in the U.S. and China, two of the largest art markets globally.
In the U.S., there have been several attempts to pass federal resale royalty legislation since the mid-twentieth century. Multiple bills have been introduced to Congress—first in 1978, then again twice in the late 1980s, and another four times in the last decade. Regrettably, each was unsuccessful. The most recent effort was spearheaded in 2018 by Representative Jerry Nadler when he introduced the American Royalties Too Act (“ART Act”), which would amend Title 17 to provide a royalty payment to artists under certain conditions. Despite the Copyright Office changing its stance in 2013 to support enactment of the right and bipartisan, bicameral support for the bill, the ART Act has not, and is unlikely to, become law.
Two other significant historical efforts to create a resale right here in the U.S. include the California Resale Royalty Act (“CRRA”) and the Artist’s Reserved Rights Transfer and Sale Agreement. The CRRA was state legislation passed in California in 1977, but the state-law approach was flawed, which is underscored by the 2018 9th Circuit ruling holding the state law invalid for almost all sales due to federal preemption by the Copyright Act of 1976.The Artist’s Reserved Rights Transfer and Sale Agreement, fashioned by art dealer Seth Siegelaub and lawyer Robert Projansky in 1971, took a contractual approach to securing royalties. Though the contract was laudable, this alternative effort fell victim to market apathy and impracticable enforcement.
Today, however, the conversation is different. The art market is booming. The 2021-2022 New York auction seasons have yielded multiple records, including the Christie’s sale of Andy Warhol’s Shot Sage Blue Marilyn (1964) for $195 million, which is now the most expensive work of 20th-century art sold at auction, and the Sotheby’s sale of the Macklowe Collection for a total of $922.2 million for 65 works across two sales, making it the most expensive auction of a private collection. Congruent with the consistent climb of sale prices, there is an increasing understanding that living artists should be more actively involved in the business and market side of their practice in addition to the making of their art. The importance of art, for artists and lovers alike, will always be its power to evoke emotion and affect change on both personal and global scales, but the market is too big for artists and dealers to remain apathetic about resale royalties.
Additionally, the societal crises of recent years have been positioned as calls to action for the art world to embrace technological advancements and rethink its model of recognition. Though exhibitions, fairs, and auctions have resumed in-person attendance, the online viewing rooms, digital sales, and digital artworks that became integral to art and its market’s survival during the height of the pandemic remain as now-accepted alternatives. And, even more importantly, the people and institutions that provide necessary support for artists—museums, galleries, collectors, critics, etc.—have made strides towards cultivating a more inclusive and equitable art world.
In many ways, both art and technology stand in contrast to the sluggishness—and not to mention, rigidity—of the law. Art and technology are alike in their malleability and thus can serve as apt mediums for timely reaction to societal issues. With the emergence of new technologies coinciding with a keenness for re-examining the equitability of existing systems, this is the moment for the U.S. art market to reconsider its stance on, and approach to, resale royalties.
Granting resale royalties to artists would make a more equitable market by quite literally giving artists continuing financial equity in their works. With the development of blockchain and similar secure ledgers, perhaps legislation is no longer the most logical way to provide these royalties. Placing the cue from Siegelaub and Projansky in our current context, one can readily see an opportunity to implement royalties through negotiated contractual agreements bolstered by these technological advancements, which bring new power to a contract and all but render moot the issues of tracking and enforcement that plagued earlier efforts.
Artist David Hockney wrote: “Technology has always contributed to art. The brush itself is a piece of technology, isn’t it? But tools don’t make pictures. People always have to make them.” “Every picture ever made has rules,” says Hockney. Now, pictures (and all other art forms) may come with one more rule, should the relevant parties so choose. This rule would simply acknowledge that artists—the people that make the art we so admire—deserve a share of the dollar sums achieved by their works over time. Now is the moment for technology to contribute to art and its ecosystem in a newly significant way.
