The Path Least Followed: Ratermann v. Pierre Fabre USA, Inc. Creates New Standard for Whether New York Publicity Rights Encompass Intellectual Property

The Southern District of New York recently categorized state publicity rights as “an aspect of the right of privacy” distinct from property, thus preventing publicity claims from falling under the intellectual property exception in the Communications Decency Act (CDA), or 47 U.S.C. 230. The ruling in Ratermann v. Pierre Fabre USA, Inc. further complicates what counts as intellectual property in an increasingly modern world.

Section 230 of the CDA was enacted by Congress in 1996 as a tool to prevent litigation from hampering the success of the Internet in its earliest stages. It acts by immunizing online intermediaries from legal responsibility for the actions of third parties. However, Section 230 has an express provision that it does not protect online intermediaries from intellectual property claims. Rulings by the Ninth Circuit and the Third Circuit have created a split on whether certain state publicity rights are also intellectual property rights within the meaning of the Section 230 exception. In Ratermann, a new interpretation of the intersection between publicity rights and intellectual property further muddies the water.

Patty Ratermann brought a claim against Pierre Fabre, Amazon, Walmart, Ulta, and Walgreens for violating New York Civil Rights Law Sections 50 and 51 after signing “a single-use license with QuickFrame giving QuickFrame the right to use her likeness on Instagram[.]” Though she never gave her consent, her likeness was subsequently “used to advertise Pierre Fabre’s Avène products on the Avène website; on the websites of retailers Amazon, Walmart, and Ulta; and ‘in physical advertisements in stores owned and operated by’ Walgreens.” In its ruling, the Court decided an issue of first impression: whether “claims under Sections 50 and 51 are intellectual property claims within the meaning of this provision,” which, if answered in the affirmative, would prevent Pierre Fabre, Amazon, Walmart, and Ulta from immunization under Section 230.

 Until the Ratermann decision, courts came out one of two ways. The first standard, set out in Perfect 10 v. ccBill by the Ninth Circuit, dictated that Section 230 immunizes online intermediaries from state intellectual property claims, but not federal intellectual property claims. The court in ccBill reasoned that because of the lack of an express definition for “intellectual property” in the CDA, there is a large number of potential intellectual property claims that could fall within the state or federal sphere. The court then found that because federal intellectual property law is more developed than its state counterpart, the definition of “intellectual property” in the CDA referred to federal law only.

The Third Circuit set out a second standard in Hepp v. Facebook, where the court held that the right to publicity is an intellectual property right that prevents third-party intermediaries from gaining immunity under Section 230. The court gave credence to Black’s Law Dictionary and McCarthy's Desk Encyclopedia Of Intellectual Property, which “explicitly list the right of publicity as an intellectual property right.” Additionally, the Third Circuit cited Zacchini v. Scripps-Howard Broadcasting Co., where the Supreme Court pointed to how publicity rights are individual property that is “closely analogous to . . . patent and copyright”  due to the focus “on the right of the individual to reap the reward of his endeavors and [has] little to do with protecting feelings or reputation.”

In contrast with these two standards, the Southern District of New York  drew a distinction between intellectual property rights and publicity rights in Ratermann, holding that “New York courts have long construed Sections 50 and 51 to provide a statutory right to privacy, not property.” The Court further held that Patty Ratermann’s Section 51 claim does not encompass intellectual property because “it is the injury to the person not to the property which establishes the cause of action.” The circuit-split issue of whether intellectual property rights fall within publicity rights may soon have another addition as Ratermann awaits an appeal.

Emily Gillen is a second-year at Wake Forest University School of Law and a staff member on the Wake Forest Journal of Business and Intellectual Property. She graduated with her B.S. in Psychology from Michigan State University in 2021.

 Reach Emily here:

Email: [email protected]

LinkedIn: https://www.linkedin.com/in/emily-gillen-a757361a4/