Is it Illegal to Sell a Custom McFarlane?

Hey guys, I just wrote an article about whether or not it is illegal
to sell a custom http://www.sportslizard.com/article17.php. I know most customizers check this board so I'm curious to see what you guys think.

[Miami Mike]

Short Answer. Yes it is illegal.

[starscream's ghost]

i'm sure when you get down to it, a custom would be illegal because you don't have authorization to sell the logos and such. but then that might make ebay and garage sales illegal

So is this quote from T.J. Schwartz in Tuff Stuff not true?

“I’ve interviewed most of the big licensors during the past 15 years of this column. Original artwork of anyone is fine and does not require a license as long as there is only one of them. In other words, if an artist paints a picture of anyone famous, he/she can sell it without paying that person any royalties or licensing fees. As soon as there is more than one, the licensing kicks in. The rights of the person in question, also kicks in. This spells cash owed to someone.”

My overall stance is still to proceed with caution, but that quote makes it seem to me like it's legal.

[starscream's ghost]

after reading the article, i think that if the team doesn;t have a problem with it it should be ok. but then you also have the big issue of if the companies that produce the player's equipment find out and freak that people are using their logos for profit. i think it's only a matter of time before a company steps up like notre dame did

btw, good article

[BlakChamber]

If you make a custom for yourself, you'll probably be fine.

If you start cranking them out and selling them on ebay, you're going to be in trouble.

[starscream's ghost]

i also think a lot of people saying they are not affiliated with anything helps a little

[BlakChamber]

Saying you're not affiliated covers your butt since you're not claiming its an official figure or you're part of the company.

However, it does nothing to cover yourself for trademark infringement.

[Voodoo Chylde]

Very well written article. My take is this. I put a LOT of work and research into making my customs as accurate as possible ergo, they are very time consuming. I believe this is true of most of the elite customizers (Eddie20, ArtofTom, Nucksfan, Jomo, SBC31, StupidSuck, TheGuide, etc. If I left anyone out, it's because there are so many "elite" customizers out there.) You are so proud when you finish a custom and it looks "just right" that you don't even think about trying the same one twice. Especially if it was a challenging one.

So far, all of my customs have been 1 of 1 therefore, I consider them to be pieces of art. I don't know how someone could consistently put out high quality customs at high volume e.g. accurately turning Gerry Cheevers into Bernie Parent or Jacques Plante...times 70. The two usually don't go together.

[coltsfan16]

as a customizer, if you sell them for a profit, you need to assume the risks that come along with it.

using the 1/1 "art" angle will only take you so far.

example....
you make a bunch of shoes, some look like jordans, some like AI's some like addidas. you may make a bunch of jordan style shoes, but none are exactly 100% alike. now these take you a long time to make and even more so because you try to make them 100% accurate. if you decide to sell these shoes on a rutine basis on ebay, do you think nike, reebok and addidas would mind?

[ptrac30]

Todd mcfarlane said himself that he doesn't have a problem with it unless someone puts the Mc Farlane logo on it. In the end, if any of this turned lucrative and showed that people were cleaning up you can bet somebody would put a stop to it.

Personally, I do it because its calming and allows me to focus on something other than my XBOX360 or wasting money on add-ons for my car. When someone requests a custom from me, what they pay me certainly doesn't cover any kind of an hourly wage. I can't imagine anyone making money doing this in terms of time spent, effort and materials involved. Some people claim to, I just don't see it.

My point is, in order for it to be illegal I think a PROFIT would have to be shown. I know I'm certainly not making any profit on it. I just enjoy it becuase I can create figures that TMP has not.

[coltsfan16]

a similiar example would be the sites that allow you to download the front disk artwork from dvd movies. there is only one reason why somebody would want to download the artwork sticker from a dvd movie... it is legal to download it, but the intensions and purpose are illegal....kinda like a cable descrambler. again, legal to own, illegal to operate.

it is legal to own a custom figurine, it is illegal to sell them.

Originally Posted by ptrac30

My point is, in order for it to be illegal I think a PROFIT would have to be shown. I know I'm certainly not making any profit on it. I just enjoy it becuase I can create figures that TMP has not.

Very good point. I wonder how many customizers actually profit when you factor in labor and supplies

[ptrac30]

Essentially, taping a program on a video casette or making a mix CD for your friend is illegal. I don't know anyone whos been arrested for that.

[coltsfan16]

here is a copy of a letter that was sent to another customizer...i would post mine from OSU, but it came in a PDF format and this way was easier.... it is from jomos forum...

Dear Ebay Seller:

It has come to our attention that your company is producing merchandise using our federally registered trademarks. We are informing you that the use of the trademarks of The University of Iowa without our express permission is a violation of our rights, and request that you cease and desist such use. Your unlicensed use of our marks will confuse the public and cause them to think that these goods are legally licensed.

We request that your firm send us an itemized accounting including the name and description of each item your company has made or sold that bears The University of Iowa's logos/trademarks (copies of invoices with copies of graphics will suffice), the number of units of each item manufactured and sold, and the wholesale value of each of these items. In addition, you will need to send us a statement that you have discontinued advertising, offering for sale, producing or selling goods bearing any of the names or marks belonging to The University of Iowa. Finally, all goods bearing our names or marks MUST immediately be pulled from retailers' shelves and inventory as well as from your inventory and sent to us for disposal.

In lieu of pursuing our legal remedies, it is our desire to settle this matter by accepting payment of damages. We are prepared to establish damages at our normal royalty rate of eight ( percent of the net sales price of any merchandise sold.

I urge you to take this opportunity to get this matter resolved within ten days from the receipt of this letter. Otherwise, we will explore the legal options available to us to protect our intellectual property rights. If you have questions, please call me at xxx-xxx-xxxx.



Any suggestions are greatly appreciated,

Thanks,
Jay

Very good point. I wonder how many customizers actually profit when you factor in labor and supplies

this arguement would not stand for the simple reason that your intension is to make them and sell them... you are not trying to sell them for a loss of money are you?

[ptrac30]

Originally Posted by mcfara

Very good point. I wonder how many customizers actually profit when you factor in labor and supplies

There are plenty who will say that they can. i just don't see it. if you care about the outcome of your work there's no way you can earn enough to pay for it. My real job, I make $50-$75 an hour working as a graphic designer freelance. As far as doing customs - I spend over an hour just setting up my decals for print and checking for color accuracy.

BTW - Anyone who puts McFarlane on their inserts are asking for trouble. Using the NFL logos is one thing but calling it a mcfarlane?

Originally Posted by coltsfan16

this arguement would not stand for the simple reason that your intension is to make them and sell them... you are not trying to sell them for a loss of money are you?

I don't think anyone sells them for a profit- they may think they are, but if they were to record their hours, supplies, space, etc... they would see that they are not making any money. Selling them might fund the hobby, but it does not pay you a wage. If anyone is looking to make extra cash, get a 2nd job at a fast food chain- you'll be making a lot more per hour...

I have not received a letter from any University, if I did- I would send them a statement showing my time, cost of materials, space in my residence dedicated towards it, gas costs for supplies etc... and when they see the profit margin is in the red, I would ask them what percentage of that they would like to pay me... so we can 'share' the outcome...

[ptrac30]

Originally Posted by bnb_16

I don't think anyone sells them for a profit- they may think they are, but if they were to record their hours, supplies, space, etc... they would see that they are not making any money. Selling them might fund the hobby, but it does not pay you a wage. If anyone is looking to make extra cash, get a 2nd job at a fast food chain- you'll be making a lot more per hour...

I have not received a letter from any University, if I did- I would send them a statement showing my time, cost of materials, space in my residence dedicated towards it, gas costs for supplies etc... and when they see the profit margin is in the red, I would ask them what percentage of that they would like to pay me... so we can 'share' the outcome...

Well said. Nothing more needed!

[Zildjian]

I think customs actually help both the leagues and McFarlane in the long run.... you have to buy the figures which McFarlane produced to make a custom, so McFarlane does not lose out. If you call it an authentic McFarlane Sports Pick, then you are in trouble.

In my experiences, it is more the colleges that have the issues than the pro teams.

[Zildjian]

Originally Posted by bnb_16

I don't think anyone sells them for a profit- they may think they are, but if they were to record their hours, supplies, space, etc... they would see that they are not making any money. Selling them might fund the hobby, but it does not pay you a wage. If anyone is looking to make extra cash, get a 2nd job at a fast food chain- you'll be making a lot more per hour...

I have not received a letter from any University, if I did- I would send them a statement showing my time, cost of materials, space in my residence dedicated towards it, gas costs for supplies etc... and when they see the profit margin is in the red, I would ask them what percentage of that they would like to pay me... so we can 'share' the outcome...

PERFECT! If there is no profit there is no issue.... all they care about is $$$!

[mrmain18]

There is a huge difference between something being 'illegal' and violating a copyright. Selling a custom is not 'illegal' or a criminal activity. It will not get you jail time or even a fine. It's not like selling drugs. Violating/Infringing a copyright would be a civil matter. You won't go to jail, but you very well could get bent over financially. Regardless of a profit, the copyright holder could still file suit over unlicensed used of the copyrighted image. That doesn't mean they would win, but it would still cost you a whole heap of legal fees.

I figured it out for me persoanlly, and after the cost of the base fig, paints, primer, sealers, decals, ink for the printer, high end paper for custom inserts and my time, I make about $1 - $2 bucks from every custom I do. I would be happy to send any univeristy or team 8% of that. hope they accept it in pennies, lol.

I have run into similar things in my business, and I find it weird how some of these organizations go after people. A while back a team out here was getting sued for using the Mighty Ducks logo, a team made up of all doctors, called the mighty Docs. A kids team in the same area using the Ducks logo get no complaint.

I have been printing Calgary Flames apparel for a few years now. I know what happens when you do have permission to print such things. I get people always asking can you make me some Flames stuff. Or can you put the Flames logo on my bar staff shirts.
I am just waiting for all these fake flames stuff to show up once the play-off start.

[lloydchristmas81]

I was the one who recieved the letter from the University of Iowa. I have to say that it was enough to get me to stop making college figures all together. I ran into the same situation w/ Wisconsin and the CLC.

I was ready for them to ask for the 8% and I had figured out what that would have been.... about $35. That's not subtracting supplies. I would rather avoid the trouble all together than have to deal w/these people again. They truely have nothing better to do.

I have heard that if you say it's a "one of a kind work of art" it will be fine before. However, I do not want to have to pay a lawyer, and go to court to find out if this is true.

And last, my take on the profit: I agree w/all who say once you figure out time, supplies, research, etc. You make very little if any money per hour at all. I do sell my figures on the Bay and I make enough to pay for some of the supplies, and buy an autograph or two a month. I would never dream of making this a full time job. 1. I don't think you could ever pay all your bills, 2. making this a job rather than a hobby would take all the fun out of it. That's what it's supposed to be. A hobby.


BTW
very nice article mcfara

thanks for the compliments guys, it's much appreciated

What if you sold the picture of the custom, that included the custom for free. Kind of like when someone advertise's a $5000 dog that comes with a free car - don't ask I seen it on Jay Leno one time

[rafprop]

It doesn't really matter if it's a violation of trademarks/copyrights or not. If one of the teams or schools contacts Ebay about it, Ebay will pull the auction. You can put that you aren't affiliated with the team/player/league or you can try selling a hat with the custom free, but if the team complains, Ebay will pull the auction. If the team contacts you directly, you can make any argument you want, but if the team wants to pursue it, is any customizer really going to spend the money to argue it in court? The customizer might win, noone knows for sure, but they might lose too and the costs to pursue it and the possible damages if you lose would be more than any sane customizer would want to risk. Especially since the profit in customs isn't really all that much.

[EDBSIP]

then everyone on eBay and the customizers here should be punished appropiately if that was the case, which I dont agree with

[darth_crosby87]

Originally Posted by mcfara

So is this quote from T.J. Schwartz in Tuff Stuff not true?

“I’ve interviewed most of the big licensors during the past 15 years of this column. Original artwork of anyone is fine and does not require a license as long as there is only one of them. In other words, if an artist paints a picture of anyone famous, he/she can sell it without paying that person any royalties or licensing fees. As soon as there is more than one, the licensing kicks in. The rights of the person in question, also kicks in. This spells cash owed to someone.”

My overall stance is still to proceed with caution, but that quote makes it seem to me like it's legal.

Found this on the topic of Derivative works... I believe this to the most clear cut answer I have found regarding custom work.

DERIVATIVE WORK RIGHTS

When an artist creates a work of art, the copyright comes into existence automatically. No registration is required, though it may be necessary to protect some remedies if the artist ever plans to sue for infringement (REGISTERING) . The copyright provides the owner with a number of exclusive rights, including the right to make new versions of the original work, called derivative works.

Such a derivative work would include the adding new artistic elements to a past work, i.e. putting the Mona Lisa in a halter top and pigtails while smoking a cigarette. This concept also protects an artist from having his/her original work reproduced in a different media by another artist, without the consent of the first artist.

Here is the original link (that includes a couple example cases as well)
http://www.artslaw.org/DERIV.HTM


quoting mcfara's article (very informative ... thanks!):

In the September 2004 issue of Beckett Hockey, Todd says “I think that it’s cool and interesting that our fans are using our figures as a base for their own creativity.” He goes on to talk specifically about selling customs “In general, I have no problem unless someone is trying to pass a custom off as some sort of official McFarlane action figure.”

Is it safe (legal) to assume Todd's feelings haven't changed over time? I would love to see the whole article.

[nucksfan]

It's a tough call, but I see it as art, instead of it painted on a canvas it's three dimensional on plastic and if an artist can claim "artistic liberty", why can't we? I have never once claimed that my customs are McFarlanes or McFarlane products and I know that most of us on here steer clear of using McFarlane logos on our inserts, although I have warned several guys on here about that. On the other hand, when I delivered the Spencer Machacek figures to him, several of the Giants front office and management happened to see the figures, in package with Giants, CHL and WHL logos on the inserts and had no issues at all with them......like I said, it's a tough call.

[mgratton]

Originally Posted by darth_crosby87

Found this on the topic of Derivative works... I believe this to the most clear cut answer I have found regarding custom work.

DERIVATIVE WORK RIGHTS

When an artist creates a work of art, the copyright comes into existence automatically. No registration is required, though it may be necessary to protect some remedies if the artist ever plans to sue for infringement (REGISTERING) . The copyright provides the owner with a number of exclusive rights, including the right to make new versions of the original work, called derivative works.

Such a derivative work would include the adding new artistic elements to a past work, i.e. putting the Mona Lisa in a halter top and pigtails while smoking a cigarette. This concept also protects an artist from having his/her original work reproduced in a different media by another artist, without the consent of the first artist.

Here is the original link (that includes a couple example cases as well)
http://www.artslaw.org/DERIV.HTM


quoting mcfara's article (very informative ... thanks!):

In the September 2004 issue of Beckett Hockey, Todd says “I think that it’s cool and interesting that our fans are using our figures as a base for their own creativity.” He goes on to talk specifically about selling customs “In general, I have no problem unless someone is trying to pass a custom off as some sort of official McFarlane action figure.”

Is it safe (legal) to assume Todd's feelings haven't changed over time? I would love to see the whole article.

Actually, what you have quoted doesn't provide an answer to the customizing issue, because the biggest legal issues to custom figures are trademarks (team logos) and rights to privacy (players). The derivative works doctrine only applies to copyrights and does not address these issues.

[darth_crosby87]

Originally Posted by nucksfan

It's a tough call, but I see it as art, instead of it painted on a canvas it's three dimensional on plastic and if an artist can claim "artistic liberty", why can't we? I have never once claimed that my customs are McFarlanes or McFarlane products and I know that most of us on here steer clear of using McFarlane logos on our inserts, although I have warned several guys on here about that. On the other hand, when I delivered the Spencer Machacek figures to him, several of the Giants front office and management happened to see the figures, in package with Giants, CHL and WHL logos on the inserts and had no issues at all with them......like I said, it's a tough call.

Your work is superior ... they probably assumed it was done by a major toy company
Actually those guys probably have bigger issues on their minds than action figure licensing. As you say its a tough call.

[darth_crosby87]

Originally Posted by mgratton

Actually, what you have quoted doesn't provide an answer to the customizing issue, because the biggest legal issues to custom figures are trademarks (team logos) and rights to privacy (players). The derivative works doctrine only applies to copyrights and does not address these issues.

Are the original figures copyright? The packaging says yes. If I paint them completely white with no logos/trademarks is the 3-D sculpt still copyright by McFarlane. I assume yes. If so the rights to this 'derivative' work are still controlled by McFarlane, even without any logos/trademarks. So a very basic custom like this.... yes, is an original.... yes is art, but technically is still under the legal reigns of McFarlane Toys, since it is their sculpt.
Your right... its not the biggest issue, but probably the most fundamental ....

[jlangendorf]

Originally Posted by darth_crosby87

Are the original figures copyright? The packaging says yes. If I paint them completely white with no logos/trademarks is the 3-D sculpt still copyright by McFarlane. I assume yes. If so the rights to this 'derivative' work are still controlled by McFarlane, even without any logos/trademarks. So a very basic custom like this.... yes, is an original.... yes is art, but technically is still under the legal reigns of McFarlane Toys, since it is their sculpt.
Your right... its not the biggest issue, but probably the most fundamental ....

Does that mean that it is ok for people to sell the figures in the 100 count plastic cases or as ornaments?

[rafprop]

Originally Posted by darth_crosby87

Are the original figures copyright? The packaging says yes. If I paint them completely white with no logos/trademarks is the 3-D sculpt still copyright by McFarlane. I assume yes. If so the rights to this 'derivative' work are still controlled by McFarlane, even without any logos/trademarks. So a very basic custom like this.... yes, is an original.... yes is art, but technically is still under the legal reigns of McFarlane Toys, since it is their sculpt.
Your right... its not the biggest issue, but probably the most fundamental ....

Your analysis is off.

The U.S. Copyright Act grants certain exclusive rights to the owner of a copyright in a work. These exclusive rights are different from the rights given to a person who merely buys/owns a copy of the work.

For example, when a collector purchases a figure from TMP, they have received a property right in a copy of a copyrighted figure. The collector may then resell the figure, repaint it, or even destroy it, since they own the figure. However, the collector did not receive any copyright rights when they purchased the figure. All copyright rights are held by TMP. So, the collector may not make any copies of the figure, since the right to copy a figure is one of the exclusive rights granted to the copyright holder (TMP) under the Copyright Act. This distinction allows TMP to sell copies of their figures, or even the original work itself, without forfeiting her rights under the Copyright Act.

So basically, a customizer can customize a figure without violating TMP's copyright. They just can't use the figure to make additional copies.