Essays

An Illustrated Guide to Artist Resale Royalties (aka ‘Droit de Suite’)

American artists and legislators have been actively battling to introduce a national Artist Resale Royalty for almost half a century. Here is our illustrated introduction.

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(All images by Lauren Purje for Hyperallergic)

Droit de suite (“right to follow”) is the notion that artists, their heirs, and estates should receive an Artist Resale Royalty (ARR) every time one of their works is subsequently resold. The royalty is typically a small percentage of a resale (usually around 3–7%). Supporters of ARRs contend that the practice helps to support working artists, providing income that can be reinvested into studio rents and materials.

Although artists have the same copyright protections as other authors, they are often unable to commercialize their works for profit in the same way.

For example, unlike writers, filmmakers, and musicians, artists don’t benefit from derivative or reproducible income (such as screenplay rights or soundtrack licensing). Most artists only profit from the initial sale of a work of art. This is because the art industry places a massive premium on uniqueness.

The idea supposedly originates from a complaint by the family of French Realist Jean Francois Millet. In 1889 (14 years after the artist’s death), the French copper magnate Eugène Secrétan sold Millet’s painting “L’Angélus” (1857–59) for a record breaking 553,000 francs. Millet’s family was completely destitute at the time and was horrified by the sale (ironically, the painting depicts two peasants bowed in prayer).

France was the first country to nationally implement droit de suite (1920). It followed in the wake of a widely published lithograph by Jean-Louis Forian, which drew popular sympathy to the cause. The lithograph depicts an artist’s children gazing at a painting in a shop window with the caption, “Un Tableau de Papa! / one of father’s paintings!”

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Belgium followed suit in 1921, as did Czechoslovakia in 1926. At present, over 70 countries have implemented ARR laws, including Australia, the Philippines, and Russia. The European Union standardized its legislation in 2001.

The United Kingdom partially implemented a resale royalty scheme in 2006, despite loud protestations from auction houses and some galleries that this would severely damage the market and drive sales abroad. A subsequent report found that the changes had not negatively impacted the UK’s market in any perceptible way. Two nonprofit agencies, DACS (The Design and Artists Copyright Society) and ACS (Artist Collecting Society), collect ARRs on behalf of registered members. According to their website, DACS paid out out over £14 million ($22.5 million) in royalties to 19,000 artists and estates in 2013. They even occasionally run competitions to encourage artists to sign up.

The US doesn’t have a national artist royalty scheme, which puts it in the same company as Canada, China, Japan, and Switzerland. American artists and legislators have been actively battling to introduce a national ARR for almost half a century.

In 1971, the legendary curator and publisher (and all-round cool dude) Seth Siegelaub teamed up with attorney Robert Projansky to create The Artist’s Reserved Rights Transfer and Sale Agreement (ARRTSA). When signed by a purchaser, the document entitled artists to 15% of any profits made upon subsequent resales (it also included provisions for exhibition and reproduction rights). The legality of ARRTSA remains questionable, but a number of dealers (including Leo Castelli) professed to using the document, the first of its kind in the US. “Consider the contract as a substitute for what is available otherwise: nothing,” Siegelaub wrote.

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Curator Seth Siegelaub co-authored “The Artist’s Reserved Rights Transfer and Sale Agreement” (1971) with lawyer Robert Projansky.

Between 1976–2012, California was the only US state to have had an artist resale royalty law. Its genesis is popularly traced to an eventful evening in 1973, a night renowned artist Robert Rauschenberg got very angry.

On October 18, 1973, the collectors and taxi company owners Robert and Ethel Scull held an auction of their collection at Sotheby’s Parke-Bernet. The sale was a turning point in the art trade, as it demonstrated just how lucrative works of contemporary art had become. The Sculls represented a new breed of collectors who started to view art as an investment asset, a commodity that could be resold for a huge profit. A lavish catalogue was printed, and heaps of press material celebrated the couple’s expert connoisseurship. That night the Sculls sold works by Andy Warhol, Jasper Johns, James Rosenquist, and Rauschenberg for record sums. A 1958 painting by Rauschenberg entitled “Thaw” sold for $85,000 (the Sculls had originally purchased the painting from Rauschenberg for $900).

Rauschenberg made his way through a picket line of disgruntled artists and Scull taxi cab employees outside the auction, and confronted Robert Scull directly. Their exchange is featured in the documentary film America’s Pop Collector: Robert C. Scull – Contemporary Art at Auction. The footage also appears in Robert Hughes’s excellent documentary The Mona Lisa Curse (2008) (around the 24:40 minute mark).

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Robert Rauschenberg and collector Robert Scull

According to Ethel Scull, Rauschenberg punched her husband in the stomach, and the two never spoke again. Rauschenberg teamed up with James Rosenquist, and their campaigning efforts inspired the 1976 California’s Resale Royalty Act (CRRA).

Under the CRRA, a 5% royalty applies to artworks worth over $1,000 and resold for a gain. The act stipulates that an artist must be a US citizen or a resident of California for at least two years at the time of sale.

In October 2011, a group of artists and estates, which included Chuck Close, Laddie John Dill, the Robert Graham estate, and the Sam Francis Foundation, sued Sotheby’s, Christie’s, and eBay, alleging that the auction houses were failing to pay royalties as provided for under the CRRA. Lawyers for the defendants argued that the CRRA was unconstitutional, as it purported to regulate transactions taking place outside the state of California. The judge presiding over the case agreed. The constitutionality of the CRRA remains unresolved until the Ninth Circuit Court of Appeals rules on the artists’ appeal.

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Artist Chuck Close. In 2011 Close, along with other artists and estates, took legal action against Sotheby’s, Christie’s, and eBay. The suits backfired when a judge held the California Resale Royalty Act to be unconstitutional.

The three auction companies recently argued to the Ninth Circuit Panel that a rehearing is unnecessary. Lawyers acting for the companies have pointed to earlier cases concerning commercial regulations on California activity, including decisions on a foie gras ban and a low carbon fuel standard.

Other failed attempts to introduce ARRs in the US include the Waxman Bill (1978), and the Visual Artists Rights Amendments of 1986 and 1987.

In 1992, the US Copyright Office published a report advising against the adoption of a national ARR scheme (though it suggested that Congress could revisit the issue if the European Union successfully harmonized its own laws).

In 2011, Senator Herb Kohl (D-WI) and Congressman Jerrold Nadler (D-NY) introduced the Equity for Visual Artists Act. The bill advocated a 7% royalty on works sold at public auction for $10,000 or more. Had it been enacted, royalties would’ve been split evenly between the author of the work and an escrow account to support future purchases by nonprofit art museums.

If the US had already adopted a national resale royalty, American artists would currently be receiving royalty payments from countries with equivalent laws (due to reciprocal agreements such as the Berne Convention). This means that American artists have been missing out on potential royalty payments for quite some time.

In December 2013, the US Copyright Office published a new report which encouraged Congress to consider legislative action:

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The logo of the United States Copyright Office (founded 1897)

The Copyright Office finds no significant legal or policy impediments to adoption of a US resale royalty, and indeed supports consideration of a a resale royalty right as one option to address the historic imbalance in the treatment of visual artists … Given most artist’s comparative lack of bargaining power in relation to auction houses, galleries, and other art market professionals, some level of congressional involvement may be necessary for these negotiations to achieve meaningful results.

Along with Senators Tammy Baldwin (D-Wisc) and Edward Markey (D-Mass), Congressman Jerrold Nadler has now put forward the American Royalties Too Act (ART). If passed, the act would require a 5% royalty on all works of art worth over $5,000 sold at auction (with a maximum royalty payment capped at $35,000). The act would only apply to auction houses with annual sales of over a million dollars.

The Visual Artists Rights Coalition and the Artists Rights Society are lobbying in favor of the bill. Christie’s, Sotheby’s, and eBay are lobbying against it.

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On July 15, the House Judiciary Subcommittee on Courts, Intellectual Property, and the Internet discussed the ART Act. The subcommittee’s chairman, Howard Coble (R-NC), indicated in his opening remarks that he is “not uncomfortable with the notion of a resale royalty.” A recording of the hearing is available at judiciary.house.gov (the hearing begins at the 52:10 minute mark, and Congressman Nadler’s comments begin at 1:05:16).

In her witness testimony to the subcommittee, Karyn Temple Claggett, the associate register of copyrights and director of policy and international affairs for the US Copyright Office, described resale royalties as “an issue of fundamental fairness.”

“There is a compelling international trend that makes US review of the resale royalty right timely and important,” Claggett testified.

At present, the ART Act only has 15 cosponsors. It’s therefore essential that artists and the art-loving public express greater support for the bill. The debate on resale royalties should be taking place between friends, colleagues, and on social media — not just between lawyers and politicians.

To express your support of the ART Act, write a letter to your state’s senators and representatives. If that sounds too arduous, reach out to them via the contact forms on their websites. It’s easy. Help spread the word. Five minutes of your time might just spur a lifetime of change for artists.

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