Thursday, March 28, 2013


FASHION LAW NOTES: BRAZILIAN CONGRESS PASSES A BILL THAT REGULATES TH...: The Committee on Constitution,  Justice and Citizenship of the Brazilian House of Representatives has passed a bill ( Projeto de Lei nÂș...

Wednesday, March 27, 2013


FASHION LAW NOTES: YOKO ONO SUED FOR COPYING NYC DESIGNER's FASHION C...: Yoko Ono's mens line Brooklyn fashion designer Haleh Nematzadeh, owner of Smashing Starlets, filed a lawsuit last Friday, March 22,...

Model Law 101

Just when you thought the law could not find its way into a new nook and cranny, there is MODEL LAW. Just like fashion law, it is not one of the commonly named types of law but it exists. Some of the legal issues that occur are contracts and negotiations, right to privacy (commercial appropriation), employment and labor, and photo licensing- just to name a few.

On the other spectrum some issues that models may encounter hit the morals of everyday life: is he/she too young or too thin to model? We've all seen that gaunt minor appearing ghost like on the cover of a high fashion magazine. Just ask Marc Jacobs who used an underaged model for his Feb 2012 runway (more below).

But alas! Some fashion organizations have taken a step forward and either recommended guidelines or have placed age and weight requirements in order to work as a model for them. Take Vogue Magazine for example. In the summer of  2012, the magazine reported that all 19 of its international editions have adopted a policy that would not allow it to work with models under the age of 16 or who appear to have an eating disorder.

However the magazine broke its pledge later that year when the August 2012  issue of Vogue China featured this model, Ondria Hardin, under the age of 16 at the time of the photo below. In fact her Modeling skills must have been that bomb because she was one of the two underaged models to walk in the Marc Jacobs show of February 2012. Marc Jacobs responded saying: there are children actors and children models for catalogs and stuff, so I guess if a parent thinks it's O.K. and a kid wants to do it, its' fine."  
Huffington Post
 But does Marc Jacobs have a point? There are child actors who, under parental guidance, sign entertainment contracts all the time. Further, The Fashion Law Institute tweeted that if a contract is signed by the parents, the contracts can be binding for the most part, which is why it is imperative for them to be read and understood.

Interestingly enough, this is not the first time that an organization or a group has stood up for the health of models. The Council of Fashion Designers (CFDA) also made efforts to promote health and age standards for models as well. The CFDA received pledges from all the top modeling agencies- including DNA, Elite, Ford, IMG, Marily, Wilhemina- that they will not send out any models under the age of 16 for shows. 

For a deeper look into the modeling industry, (1)visit PBS's infographic on the girl model. It explains the international model's statistics in the following area: where she comes from, what she looks like, how much she grosses as a career, and the function of the agent/agencies (really interesting read); and (2) Watch PBS's Girl Model Documentary about the real lives of two girl models.

Fashion Legallaire Take:  Fashion lawyers are there to help models deal with these industry issues whether it be simple contract negotiation between the model and the agent, or the right to use the model's photo. For example, Marilyn Modeling Agency sued its model Constance Jablonski for $3.3 Million for breach of contract when she began working for competitor agency DNA Model Management.

Thursday, March 21, 2013

Neiman Marcus Under Fire for Mislabeled RACCOON DOG FUR

So as I was coming home from work listening to my daily dose of National Public Radio, I heard a report so shocking that I could not wait to research and write this fashion law article. Yes you read the title correctly: Neiman Marcus is under fire for allegedly mislabeling Racoon Dog fur as faux fur. Back in 2010 The Humane Society of the United States revealed through lab tests that an exclusive St. John Jacket, advertised by Neiman Marcus and sold for $1,895, was labeled as faux fur but in actuality, it was the real fur of a raccoon dog.

PAUSE. Yes I know some of you are probably thinking: what in the world is a raccoon dog and does it exist? And the Answer is Yes (see picture below). According to the Humane Society, this animal is a member of the Canid family  and is very much involved in the fur industry in China (where it allegedly came from). Pierre Grzybowski, manager of the Fur-Free Campaign at The Humane Society said "Independent investigations into the Chinese raccoon dog fur industry have revealed horrendous cruelty, including animals being skinned alive." Animal Cruelty is a very legal and humane issue that the fashion industry, as many of you are aware, so it is no surprise why the Humane Society got involved.

Now for the other legal issue under the Fur Products Labeling Act (FPLA), which is nearly 60 years old, it is unlawful to describe the fur on a garment as being from a different type of animal. Violations carry up to a $5000 fine and a year in prison. Further, in December 18, 2010, President Obama signed H.R. 2480, The Truth in Fur Labeling Act, which supports the FPLA by requiring all garments made with animal fur to be labeled and advertised with the correct species of animals.

It follows that the Human Society called upon the Federal Trade Commission to investigate the matter and called upon Neiman Marcus to take immediate action by contacting and offering to refund all customers who purchased this garment. And further to inspect and test any other garment that are purported to be "racoon" fur from China.

In 2010, The Federal Trade Commission Investigated Neiman and found that a Burberry coat, a Stuart Weitzman ballet-style shoe, and an Alice+ Olivia Kyah coat sold at Neiman used real raccon dog fur instead of the faux fur as advertized. Two other retailers were found to be in violation as well: DrJays and Eminent. allegedly misrepresented the fur content and failed to disclose the animal name for three products:  a Snorkel Jacket by Crown Holder with a fur-lined hood, a Fur/Leather Vest by Knoles & Carter with exterior fur, and a New York Subway Leather Bomber Jacket by United Face with fur lining. Eminent Inc., doing business as Revolve Clothing, allegedly misrepresented the fur content and failed to disclose the animal name for four products:  an Australia Luxe Collective Nordic Angel Short Boot with a fur-trimmed hood, a Mark Jacobs Runway Roebling Coat, a Dakota Xan Fur Poncho, and an Eryn Brinie Belted Faux Fur Vest.

 Therefore Neiman and the other retailers agreed to settle on Tuesday March 19, 2013. They agreed to not violate the FPLA for 20 years (slap on the wrist?) However, in 2010, Neiman settled a lawsuit with the Humane Society for $25,000 judgment after a Washington, D.C. court found them in violation of this same law. The judgment also includes an injunction prohibiting the retailer from falsely advertising or mislabeling fur garments in the future.

Read the Settlement here. 

So even though the furs here were real, how do you know if your fur is real or not? Grzybowski advices How to Spot a fake fur

If you have purchased items thinking they were fake fur, but now aren't sure, Grzybowski advises that you try the following home test:
  1. First, look at the base of the "fur." If you see sewn threads, that's a good indication the material is indeed synthetic. Usually real animal hair will still be attached to its skin.
  2. Pull a few strands of "hair" from the item.
  3. Place them in a small fire-proof dish and light them with a match.
  4. Smell the resulting fumes.
  5. If you detect a plastic odor, the fur is probably fake. 
  6. If you still can't tell, try burning a few strands of your own hair and compare the smell with that of the burnt strands from the clothing. They both should emit similar odors. (Mammal hair is made up of similar proteins, oils and other components.)

Saturday, March 16, 2013

Thursday, March 7, 2013

Securities, Mortgages, and Good Faith and Fair Dealing

According to The Washington Post, in 2012, the government began suing banks for reckless and fraudulent mortgage lending practices that cost the it hundreds of millions of dollars- namely Wells Fargo. Subsequently, some of these banks went into foreclosure.  Wells Fargo and many other banks made bad loans to struggling homeowners. So when the homeowners stopped making payments, the loans defaulted leaving the government to pay huge insurance payouts to the bank. 

But the issue turns on whether the banks acted knowingly and without good faith when making and issuing these loans. To act fraudulently is to knowingly misrepresent or lie in the circumstance. However, within core business dealings, in the common law of the United States anyway, there is an inherent and underlying duty to act with good faith and fairly deal (GFFD). This GFFD standard is especially to be upheld when a financial scanter, such as a bank institution, works with a non financial scienter such as the common home buyer. 

Of course the Government and any other government sponsored entities (GSE) (like theFederal Housing Financing Agency, Federal National Mortgage Association, or the Federal Home Loan Mortgage Corporation) who purchased certificates issued in hundreds of residential mortgage backed securities (MSB) offerings will allege that the banks knowingly made fraudulent misrepresentations, and thus, acted in bad faith when making and issuing mortgage loans to the home buyers.

Naturally, the banks will argue that they acted in good faith as prudent and responsible lenders in compliance with the federal housing rules of the GSEs. But can this argument stand when there is direct evidence of paying bonuses to staff? Remember when President Obama’s Financial Fraud Enforcement Task Force brought five similar lawsuits against CitiMortgage for mishandling money. Or when the Obama Administration rescued Wall Street and other banks? This was known as the bailout, in which one entity gives a loan to a company that faces serious financial difficulty or bankruptcy.   

Confused yet? Well let’s look at what happens to your mortgage when you sign the dotted line? 

1.       You, (the borrower) work with a broker or directly with a lender to get a home-purchase loan or a refinancing.  The borrower gets the financing needed to purchase a home or cash from refinancing. If the loan goes bad the house can be repossessed.

2.       The broker finds a lender who can close the loan. They usually have a working arrangement with multiple lenders. The broker takes fees for doing the preliminary sales and paperwork and may get cut from the lender’s approved broker list.

3.       The lender often funds the loan through a ‘warehouse’ line of credit from an investment bank. Then sells the loan to the investment bank. He takes his fees upfront for making the loan. He can also be forced to take the loan back if there is an early default or documentation is questionable. 

4.       The Investment Bank packages the loans into a mortgage-backed bond deal often known as a securitization (aka the mortgage-backed security). The investment bank (IB) now sells the securitization sorted by risk to investors. Lower-rated slices take the first defaults when mortgages go bad, but offer higher returns. The IB collects fees for packaging the loans into a bond deal. It may push back the loan to the lender or be forced to eat any loss. 

5.       The Investors choose what to buy based n their appetites for risk and reward. The lower the risk the lower the reward and the higher the risk, the higher the reward. The investor earns interest on the bonds and absorbs any gain or loss in price of the bond. May have legal recourse against bank if they can show the quality of the loan or loan documentation was misrepresented.

As the outline lists, many of these financial scienters have access to your paper work and get a fee for the work that is done in connection to acquiring your loan after you sign that dotted line. So there is a lot of room for that GFFD to go out of the window. Of course, if that occurs, you will not know about it until you default on your loan, but even then, it may be difficult to pin point who did what and when.  Therefore it is very important to do your financial research before you sign the dotted line.

Monday, March 4, 2013

Battle of the "MK" Trademark

Long Hiatus but welcome back to the fashion law blog. Without further adieu, let's talk about the battle of the "MK" symbol.
In trademark infringement news, there is a little fuss over which renowned retailer may use the symbol “MK” to adorn its cosmetics line- Mary Kay or Michael Kors. A Dallas, Texas court is currently set to hear why Mary Kay is seeking an injunction for contractual damages for breach against Micheal Kors; and why Michael Kors is countersuing Mary Kay for trademark infringement for his limited edition cosmetics line.

Mary Kay is one of the worlds leading direct selling cosmetic brands while Michael Kors is well known for his retail fashion and accessories. To some surprise, the two beauty and fashion powerhouses have some static history in the past. Starting in 2005, the parties settled a dispute over Kors’ use of various “MK” marks that he tried to register for competing products. Then in 2001, Kors asked Mary Kay twice if he could modify the agreement to allow him to register the “MK Charm Logo” mark but Mary Kay refused.

Now, per the May 12, 2012 complaint, Mary Kay alleges “notwithstanding the restrictive covenants of the coexistence agreement and Mary’s Kay’s opposition, Michael Kors filed two unauthorized applications for trademark registration without providing notice to Mary Kay.”  Also, Mary Kay did not discover the existence of the charm logo filings until late November 2012.”   Kors’ first filing with the USPTO includes the letters “MK” with a circle around the letters while the second is the same but with the words “Michael Kors” (spelled out) on the bottom border of the circle.
In reference to the first trademark filing, Mary Kay also claims that the agreement in place prohibits Kors from using “MK” standing alone, or in close proximity to “Michael Kors,” or in connection with “any products whatsoever” for cosmetics products or services.  

The alleged infringing cosmetic line by Michael Kors is a joint marketing limited-edition cosmetics gift package with Estee Lauder, who is a nonparty in this matter.