A $5-million Accidental Advertsing Campaign

I love First Amendment cases. I truly do. First of all, the First Amendment is the most basic, and yet complex, the most fundamental, but also expansive law in the American Constitution. The right to Free Expression is the of paramount importance in a democratic society and it theoretically encompasses everything: How we express ourselves, what we say, what we do, what we wear. It includes the right to be heard and also the right not to speak. However it is not unconditional. Freedom by necessity has its limits, or as the late Supreme Court Justice, Oliver Wendell Holmes, Jr., put it "The right to swing your fist, ends at the point of another person's nose."

In 2007 American Apparel posted two advertisements featuring a clip of Woody Allen from his 1977 film Annie Hall depicting Allen in Chasidic garb with a long beard, side curls, and a black hat. It depicted Yiddish text as a caption using a phrase meaning "the holy rebbe." . Woody Allen did not give his permission nor was he paid for the use of his face. Last year Woody Allen sued on the grounds that his image was used without his permission. American Apparel responded that the ad was not meant to sell clothing but as a medium of expression. American Apparel argued in addition that Woody Allen's image is so tarnished by the scandal involving his step-daughter for all intents and purposes, Soon-Yi Previn, that his value as a spokesperson is significantly diminished.

The use of someone else's image can be a tricky area. The law recognizes the doctrine of "Fair Use" which essentially means that a person can be depicted without permission if the main purpose is criticism, comment, or news reporting. This is how the nightly news gets away with as much as they do. (Let's leave aside the role of ratings, how they correlate with sensationalism and how that generates advertising revenue for another day).

American Apparel tailored their answer as a First Amendment claim. Woody Allen's face was being used for satirical comment, not to sell clothes. A perplexing argument considering that his face was posted on billboards above major roadways in California and New York. I don't know how much A.A. paid for the ads, but I'm sure it was an awful lot of money for a public service announcement tailored not to make money.

In the end, there was much chest beating. There was much posturing. There were threats. Mia Farrow, Woody Allen's ex-girlfriend/psuedo-wife would be called as a witness. Nothing to strike fear like a scorned ex whose daughter is now the wife of the witness. But finally American Apparel folded using the old "My s lawyer made me do it" excuse. They settled the case for $5-million this past Monday.

Yes, it's true his insurance company presented the defense and paid the lawyer. American Apparel's lawyers surely made a recommendation. They would not be doing their job had they not. I'm sure American Apparel's CEO, Dov Charney, was told in effect, 'Woody Allen sued for $10-million and if we present this case to a jury he is likely to win and get fees and costs. Plus there will be a judgment against you.' But neither the lawyer nor the insurance company forced American Apparel to take the deal and Charney had to sign off on it. That's the way it works. Now, I don't know what American Apparel's insurance policy was, but if any judgment had come out in excess of the the company's policy, American Apparel would need to fork up the difference. So in the end the settlement, like the initial advertisement was American Apparel's business decision, and their business decision alone.

After all the posturing this this case had as much to do with the First Amendment as arson has to do with the freedom of expression of a pyromaniac. Dov Charney loves publicity. He built his company on it. He gambled that either Woody Allen was too publicity shy, tarnished or pre-occupied to challenge him. He bluffed, he lost...but he still got publicity and plenty of it, all across the nation...and for that he hasn't paid a dime. So one question remains: Was the advertisement and subsequent settlement worth it? Was this kind of saturation worth a $5-million pay-out?