Richard Prince is a controversial artist known for appropriating third party images. Prince initially drew criticism in the 1980s when he took a photograph of a Marlboro advertisement and simply removed the word “Marlboro” from the picture. One of Prince’s appropriated Marlboro pieces earned him more than a million dollars in 2005 and another earned him more than $3 million in 2014. In 2008, Prince appropriated more than 30 works by Patrick Cariou by using photographs Cariou had published in a book titled Yes, Rasta. Prince added pops of color, blurring effects and other adjustments to create slight changes in the photographs and eventually sold one of these pieces for $2.5 million. Cariou filed a lawsuit against Prince for copyright infringement, and Prince responded with the affirmative defense of fair use. After the District Court for the Southern District of New York determined that Prince’s work was not fair use, he appealed to the Second Circuit, which held that Prince’s appropriation could constitute fair use and that a portion of the works were transformative. The Court remanded to the District Court, and Prince appealed to the Supreme Court, but his petition for writ of certiorari was denied. The case eventually settled out of court in 2014.

Fair use is an affirmative defense to copyright infringement that involves the evaluation of four factors, none of which are dispositive: (1) the purpose of the use, namely, whether the work is used for commercial or nonprofit purposes, (2) the nature of the copyrighted work (if the original work is highly creative, someone else’s use of the work is less likely to be fair), (3) the quantity and substantive quality of the portion of the copyrighted work used, and (4) the impact the use has on the original author’s ability to benefit financially from their original work. Under the first factor, if a work is “transformative” in purpose it will most likely be considered fair use. Transformative uses typically involve commenting upon, criticizing or creating a parody of a copyrighted work. Many of Prince’s pieces have been deemed “transformative,” because they involve slight changes that pass as critique or commentary.

Prince continued his appropriative style in his 2014 installation titled New Portraits at New York’s Gagosian Gallery. The exhibit featured versions of Instagram posts that Prince had screenshotted on his phone and sent to his assistant to be blown up onto large canvases. Prince wrote risqué comments below the Instagram posts prior to screenshotting them, and many of the finished pieces included seductive selfies of young women. The installation created outrage after the pieces began selling for as much as $100,000, and at least five copyright infringement lawsuits were filed.

Included in this installation were two New Portraits of the model Emily Ratajkowski. While Ratajkowski found the installation a little strange, she was not immediately upset by her image being utilized in Prince’s exhibit. In fact, she purchased, for $80,000, one of his New Portraits which included an image of her from a Sports Illustrated shoot she had previously posted to Instagram. However, after coming out publicly about her desire to regain control of her own image, she decided to use her New Portraits canvas to create a non-fungible token and profit from her own image. Ratajkowski posed in front of the Prince portrait and sold the digital image file as a nonfungible token (NFT) for $140,000.

An NFT is a digital asset, such as a photograph saved to someone’s desktop, that is authenticated on a blockchain. In the case of NFTs, blockchains store data in “blocks” that are “chained” together to create a chronological ledger of sales. NFTs are one-of-a-kind, even though the same subject matter may be available to the public for free on the Internet. One NFT cannot simply be traded for another NFT of the same value, so they are inherently more unique than any cryptocurrency. The purchase of an NFT versus downloading a copy of a picture from the Internet can be compared to physical art collection; purchasing a genuine Leonardo da Vinci painting is different than purchasing a Leonardo da Vinci painting that is reproduced on a postcard at a museum gift shop.

When someone purchases an NFT, they claim exclusive ownership of it, with the right to exclude others from claiming ownership of the digital expression. Unless otherwise noted in the blockchain, NFT ownership does not grant a person copyright in the underlying asset. It is however common for an NFT owner to grant copy and display licenses to allow purchasers to make certain uses of the work. NFTs also provide the opportunity for the creator or purchaser to profit from each subsequent sale of the NFT. For example, each time Ratajkowski’s picture is sold, she will generate more income, and over time the money made could be comparable to or exceed Prince’s income from his sale of her image. The ability to include specific rules in the blockchain may mean artists with fewer resources and an avid following could use NFTs to recover revenue in lieu of filing lawsuits for copyright infringement and thereby avoid costly attorneys’ fees.

Additionally, if someone attempts to redistribute an NFT the same way Prince appropriates Instagram posts, there could be more legal repercussions. NFTs provide more protection than an Instagram post because they are associated with a blockchain including proof of copyright and ownership information. If someone were to make an exact copy of an NFT that does not allow for copying in its blockchain, that would constitute copyright infringement. However, this does not necessarily solve the problem presented by Prince’s works. Prince could still take a copy of an NFT, make “transformative” changes, and resell a physical copy or new NFT. So, what solutions do NFTs really offer?

Using NFTs to initially post art could be a means of copyright protection due to the blockchain technology as a record of authenticity and sale. If an artist posts a work as an NFT and sells it to someone with no license to copy the work, any copy of the work would be an obvious counterfeit. Unlike physical art, NFTs come with an automatically attached record of ownership and sale which acts as proof of authenticity; therefore, any work sold without that proof could be identified as a fraud.

For celebrities like Emily Ratajkowski, NFTs are a way to reclaim publicity rights by raising awareness about the exploitation of models specifically and copyright infringement generally. Ratajkowski’s NFT enabled her to use Prince’s work as a means to profit from her own image. Her $140,000 sale demonstrates that NFTs could be a potential response to copyright infringement in lieu of a lawsuit if the NFT creator has enough name recognition and a fan base in their own right. After all, the primary reason Prince’s photographs are purchased in the first place is not for the quality of art but instead for the prestige associated with his name. Similarly, NFTs bring a level of status, allowing the purchaser to claim ownership of a unique work, rather than just one of many copies. Unfortunately, NFTs are not a proven solution for those like Prince, who appropriate works by relying on endless financial resources and weak fair use arguments. However, Ratajkowski has proven that with enough fame and publicity, NFTs present an alternative to filing suit. Please contact Lutzker & Lutzker if you have any questions about copyright issues generally and how copyright issues are impacted by the NFT marketplace.