Case Review of the 5Pointz Appeal: Castillo et al. v. G&M Realty L.P. (2020)

March 2, 2020

By Louise Carron.

February 20, 2020 will be known in legal art history as the day that street art was affirmed as “a major category of contemporary art.”^[1] In Castillo v. G&M Realty L.P., which put an end to a 7-year long dispute over the whitewashing of the Long Island City-based “graffiti mecca” known as 5Pointz, the U.S. Court of Appeals for the Second Circuit upheld Hon. Frederick Block’s February 2018 ruling for the District Court for the Eastern District of New York (E.D.N.Y.). Judge Block awarded $6.75 million in statutory damages to 21 aerosol artists whose works were destroyed without prior notice by the owner of the building where the artists had been authorized to create for a decade.^[2]

In addition to being a great win for the plaintiffs, this case helps legal practitioners understand the Visual Artists Rights Act of 1990 (“VARA”)^[3] and pays deference to graffiti as an art form. This federal law takes its roots in the European moral rights theory of protecting art as an expression of the artist’s personality.^[4] Among the rights awarded to visual artists is the protection against the willful destruction of works of “recognized stature.” VARA outlines two mechanisms for enforcing these rights:

1. Unremovable works incorporated in a building cannot be removed without the artist’s consent, unless the artist waives his or her rights in a writing signed by both the artist and the building owner.^[5]
2. Authors of removable works are entitled to 90-days written notice to enable them to salvage the works.^[6]

However, VARA does not explain how to reach the threshold of “recognized stature,” so the task of defining its boundaries has been left to the courts, litigants and their attorneys. In Castillo, the Court of Appeals determined whether temporary artworks possessed moral rights and specifically, whether they could achieve recognized stature. The court concluded that “the temporary nature of [street] art is not a bar to recognized stature.”^[7]

Facts and Chronology

Starting in 2002, real estate developer Gerald “Jerry” Wolkoff allowed aerosol artist Jonathan Cohen, a/k/a Meres One, to turn his 200,000-square-foot warehouse into a residency and exhibition space for graffiti artists. Since then, Cohen renamed the site “5Pointz” and became the curator of an artistic forum where writers from all over the world had an opportunity to create art on the walls on a rotating basis. 5Pointz, which was located near MoMA PS1 and could be directly seen from the 7 train in Queens, evolved into a “graffiti mecca” through the efforts of Cohen, co-curator Marie-Cécile Flagueul and other volunteers. The site attracted thousands of artists, locals, and tourists and quickly gained extensive media coverage. It really became part of the NYC landscape. In 2013, as Long Island City became gentrified, Wolkoff announced his plans to destroy the building and erect a luxury rental complex on the site. The plans sparked the efforts of artists to preserve the site, the art, and the community that it represented.^[8]

The legal proceedings are detailed chronologically as follows:

• May 2013: A community board meeting hearing was held at PS1 to discuss the variance application.
• August 20, 2013: The Landmark Preservation Commission denied the request to designate 5Pointz as a landmark because the site was not in existence for the required 30 years. 
• August 21, 2013: The City Planning Commission (“CPC”) issued a permit to demolish the 5Pointz buildings. CPC additionally allowed Wolkoff to build on site two towers containing 800 luxury rentals and 200 affordable units. Artists residing at 5Pointz received eviction notices, giving them until December 2013 to vacate the premises.
• October 10, 2013: Seventeen artists, including Cohen, filed a petition under VARA to enjoin the demolition.^[9]
• October 17, 2013: The E.D.N.Y. issued a ten-day temporary restraining order against Wolkoff, which enjoined him from altering the building while the court considered the plaintiffs’ motion and encouraged the parties to settle the dispute.^[10]
• October 28, 2013: The court extended the temporary restraining order until 5 p.m. on Tuesday, November 12, 2013.^[11]
• November 12, 2013: In a minute order, Judge Block lifted the restraining order, denied the Plaintiffs’ request for preliminary injunctive relief, and indicated that a written opinion would follow.
• November 12-20, 2013: Wolkoff denied artists access to 5Pointz and ordered 5Pointz whitewashed overnight, without any notification to the artists. 
• November 20, 2013: The E.D.N.Y. issued an opinion,^[12] where Judge Block concluded that, “although some of the 5Pointz paintings may have achieved recognized stature, resolution of that question was best reserved for trial.”^[13]
• June 17, 2014: Jonathan Cohen and seventeen artists filed an amended complaint before the E.D.N.Y. (“Cohen lawsuit”), claiming (1) intentional destruction of artworks protected under VARA, (2) intentional infliction of emotional distress, (3) conversion, and (4) property damage.^[14]
• March 2014: Wolkoff applied for a demolition permit.
• August 2014: Wolkoff demolished the building.
• June 3, 2015: Maria Castillo and nine other artists initiated a separate lawsuit (“Castillo lawsuit”) against Wolkoff, based on the same four claims as in Cohen.^[15]
• March 31, 2017: On summary judgment, the court consolidated the Castillo and Cohen lawsuits for trial, which would primarily address whether the artworks had achieved “recognized stature” and, if so, what was the value of the art which Wolkoff destroyed.^[16]
• October 17, 2017: The trial began in federal court and was presided over by Judge Block. The 21 plaintiffs introduced a 1,000-page report and 29 witnesses to prove that the 49 artworks destroyed had attained “recognized stature.”^[17]
• November 15, 2017: Since all parties waived their right to trial by jury, an advisory jury found that, out of the 49 works at issue, 28 artworks achieved recognized stature and eight had been mutilated or distorted, thus harming the artists’ reputations. The jury recommended $545,750 in actual damages and $651,750 in statutory damages.
• February 12, 2018: Judge Block issued a 100-page decision containing color reproductions of all the artworks, finding that (1) 45 works were of recognized stature; (2) Wolkoff had intentionally destroyed all 45 works; and (3) Wolkoff must pay the affected artists $6.75 million in statutory damages.^[18]
• February 21, 2018: Wolkoff filed a notice of appeal and argued that Judge Block abused his discretion and that the findings of fact he made were clearly erroneous. Specifically, Appellant raised the following arguments:
  • The great majority of the works in question were of a temporary nature and therefore could not meet the recognized stature requirement.
  • The artists were aware that the 5Pointz buildings would eventually be torn down, so they should have expected their work to be destroyed.
  • Recognized stature must be assessed at the time of the work’s destruction, not at the time of trial.
  • An expert as to recognized stature must base their conclusions upon actually seeing the works, not based on images.
  • Cohen’s curatorial choices are irrelevant to proving recognized stature, as he reviewed plans for the 5Pointz works before they were painted.
  • The lower court focused on the stature of the site, rather than on the stature of the individual works at 5Pointz.
  • Most importantly, Wolkoff challenged the District Court’s award of damages, claiming Judge Block was biased when he awarded the artists with highest amount possible under copyright law.
• March 15, 2018: Wolkoff filed a motion to vacate the judgment and for a new trial.
• June 13, 2018: Defendant’s motion to vacate the judgment was denied.
• August 30, 2019: Oral arguments on the appeal were held.
• October 3, 2019: Queens’ Local Community Board 2 approved Wolkoff’s development plans for “5Pointz Towers,” which include a 5,000-square-foot library, affordable units, and artist studio and exhibition space.^[19]
• February 20, 2020: A panel of three federal judges, Hon. Barrington D. Parker, Hon. Reena Raggi, and Hon. Raymond J. Lohier, Jr., unanimously affirmed Judge Block’s ruling on every count.

Discussion

1. What is a work of “recognized stature”?

Under the VARA cases of Carter v. Helmsley‐Spear, Inc.^[20] and Martin v. City of Indianapolis,^[21]the court confirmed that a work of recognized stature is “one of high quality, status, or caliber that has been acknowledged as such by a relevant community, [which will] typically be the artistic community, comprising art historians, art critics, museum curators, gallerists, prominent artists, and other experts.” Further, the court stated that “since recognized stature is necessarily a fluid concept, we can conceive of circumstances under which, for example, a ‘poor’ work by a highly regarded artist—e.g., anything by Monet—nonetheless merits protection from destruction under VARA.”^[22]

2. Can a temporary work ever attain recognized stature?

Answering this question with a resounding “YES”, the court underlined that “nothing in VARA that excludes temporary artwork from attaining recognized stature.”^[23] The court explained that VARA does distinguish between temporary and permanent works but it does not require that works be permanent to receive protection. It would therefore violate the balance of power between the legislature and the judiciary to add such a requirement into a federal law. Interestingly, the court used the Appellant’s own expert witness against him, who, during the trial, “acknowledged that temporary artwork can achieve recognized stature.”^[24]

3. How to demonstrate recognized stature?

Recognized stature, undoubtedly the most fundamental question of law in this case, may be proven through the following:

• “Expert testimony or substantial evidence of non‐expert recognition will generally be required to establish recognized stature.”^[25]
• Recognized stature may be assessed after destruction: “the quality of a work, assessed by an expert after it has been destroyed, can be probative of its pre‐ destruction quality, status, or caliber.”^[26]
• “An artist whose merit has been recognized by another prominent artist, museum curator, or art critic is more likely to create work of recognized stature than an artist who has not been screened.”^[27]
• “Appearance at a major site—e.g., the Louvre or the Prado—ensures that a work will be recognized, that is, seen and appreciated by the public and the art community.”^[28]

The court also validated the testimony of Renée Vara, the artists’ “highly regarded expert,”^[29] who testified as to the recognized stature of all the individual works and established a methodology for doing so. Wolkoff sought to set aside her testimony on the grounds that she had never seen the works in person, to which the court replied: “We see nothing wrong and certainly nothing clearly erroneous with this approach.”^[30]

4. How to calculate damages?

At the heart of the appeal was Judge Block’s decision to award $6.75 million in statutory damages to the artists (but no actual damages), which was five times more than the total amount recommended by the advisory jury. The Copyright Act of 1976 fixes statutory damages between $750 and $30,000 per work and up to $150,000 per work, if a litigant proves that a violation was willful.^[31] The most surprising part of Judge Block’s decision was his award of $150,000 for each of the 45 works, totalling $6,750,000. Feeling unduly punished because the artists did not suffer any “actual loss,” Wolkoff argued that Judge Block was unfairly biased in favor of the artists––perhaps because Judge Block, as a jazz musician, always had a passion for art.^[32]

In reviewing the decision of the District Court, the Court of Appeals considered two factors.

First, in assessing the willfulness of the act, the decision pinpointed several facts. Twice in the decision, the court emphasized that Wolkoff testified to the District Court that he “would make the same decision today.”^[33]The timeframe of the whitewashing was also particularly relevant. The court stated that “Wolkoff could have allowed the artwork to remain visible until demolition began, giving the artists time to photograph or to recover their work. Instead, he destroyed the work immediately after the District Court denied the preliminary injunction and before the district court could finalize its promised written opinion.”^[34] In justifying his actions, “Wolkoff testified that he whitewashed the work to prevent the artists from illegally salvaging their work. However, he […] testified that the artists had always behaved lawfully.”^[35] It is also noteworthy that the court also commended the plaintiffs for doing everything in their power to save their works “legally” by seeking landmark status and offering to purchase the site before resorting to bringing the case in court.

Second, the court considered the amount of statutory damages ordered by Judge Block. Under Bryant v. Media Right Prods., Inc., courts must weigh 6 factors when calculating statutory damages.^[36]

1. The infringer’s state of mind. In concluding that this factor cut in favor of the artists, both the District Court and the Court of Appeals highlighted that Wolkoff “whitewashed the artworks without any genuine business need to do so. It was simply, as the District Court found, an ‘act of pure pique and revenge’ toward the artists who had sued him.”^[37] Additionally, “Wolkoff set out in the dark of night, using the cheapest paint available, standing behind his workers and urging them to ‘keep painting’ and ‘paint everything.’”^[38] The court also took the artists’ perspective into account, by mentioning that the “sloppy” cheap paint used by Wolkoff reminded “the artists on a daily basis of what had happened to them.”^[39] The courts also mentioned that “the mutilated artworks were visible to millions of people passing the site on the subway.”^[40] This was likely emphasized to show that Wolkoff’s actions had consequences beyond the street art community as 5Pointz had become a “landmark” in the NYC urban scene.
2. The expenses saved, and profits earned, by the infringer. This factor was not assessed by the court.
3. The revenue lost by the copyright holder. The Court of Appeals agreed that the Appellees’ loss was significant, for purposes of statutory damages, but not compensable through actual damages.^[41] Nonetheless, both courts noted that “[t]he value of 5Pointz to the artists’ careers was significant, and its loss, though difficult to quantify, precluded future opportunities and acclaim.”^[42]
4. The deterrent effect on the infringer and third parties. Again, Wolkoff’s confession that “he had no remorse for his actions” helped the court determine that a “maximum statutory award could serve to deter Wolkoff from future violations of VARA.”^[43] Beyond the facts of this particular case, the court felt that an award of maximum damages “could further encourage other building owners to negotiate in good faith with artists whose works are incorporated into structures and to abide by the 90‐day notice provision set forth in VARA.”^[44] Here, the court addressed the concerns of the legal community that the outcome from this case would discourage property owners from lending concrete canvases to street artists.^[45]
5. The infringer’s cooperation in providing evidence concerning the value of the infringing material. This factor was not assessed by the court.
6. The conduct and attitude of the parties. Wolkoff’s conduct and attitude was a decisive element in the court’s opinion. The court stated “[i]f not for Wolkoff’s insolence, [the maximum statutory] damages would not have been assessed.”^[46] The Court of Appeals confirmed that “the evidence at trial established that Wolkoff had not even applied for a demolition permit until four months after the whitewashing, and he admitted that he suffered no loss for the delay.”^[47] In contrast, Judge Block noted that the artists “conducted themselves with dignity, maturity, respect, and at all times within the law.”^[48]

Therefore, the U.S. Court of Appeals saw no abuse of Judge Block’s discretion and affirmed the lower court’s decision on all counts. At most, Block’s choices could be “debatable,” but were certainly not wrong.

Takeaways

Irina Tarsis, the Founder of the Center for Art Law, said: “We are proud of our colleagues who contributed to this seminal ruling.” Beyond the legal issues at stake, this decision is noteworthy for examining street art through the lense of art history and acknowledging that it has become “a major category of contemporary art.” The Second Circuit Court references famous visual artists such as Monet, Christo and Jeanne-Claude, along with Shepard Fairey and Banksy, the latter two known for their “illegal” works and whose pieces sell for millions of dollars at auction. This decision elevates street art to the same level as “high art,” which is exactly what the community has been fighting for for decades, specifically to go beyond the “vandalism” label that authorities coined in the 1970s.

However, it must be stressed that this decision is of limited scope, as it deals with authorized/sanctioned/legal art and is unlikely to be extended to unauthorized works which have not achieved recognized stature. Also noteworthy, the court’s evaluation of the Appellant’s behavior, testimony, and experts were all used against him. This shows how this ruling is particularly fact-specific and sui generis: Jerry Wolkoff engaged in a disrespectful pattern against the artists, which the courts acknowledged and did not allow such behavior to go unpunished.

Therefore, street and graffiti artists (and visual artists more broadly) have rights against the willful destruction of their artworks so long as: (1) they had permission from the building owner, (2) the owner destroyed their works without following the legal requirements, and (3) their destroyed works had achieved recognized stature, a seemingly high threshold to reach.

Such a lengthy and painful litigation illustrates the relevance of VARA waivers, signed by property owners and commissioned artists at the time of the work’s installation and specifying that the work may be subject to destruction, distortion, mutilation or other modification by reason of its removal. Negotiation in good faith confirmed in writing can go a long way.

Hopefully, the outcome of this long dispute will lead the general public, including building developers, advertising companies, fashion brands, and the like to be more respectful of the artistic process and community that generate graffiti and street art.

Endnotes:

1. Castillo v. G&M Realty L.P., Nos. 18-498-cv (L), 18-538-cv (CON), 2020 U.S. App. LEXIS 5228 (2d Cir. Feb. 20, 2020). ↑
2. Castillo v. G&M Realty L.P., No. 18‐498‐cv (2^nd Cir. 2020), aff’ing Cohen v. G&M Realty L.P., No. 13-CV-05612 (E.D.N.Y. Feb. 12, 2018). ↑
3. Visual Artists Rights Act of 1990, 17 U.S.C. § 106A. ↑
4. See L. Carron, Street Art: Is Copyright for ‘Losers©™’? A Comparative Perspective on the French and American Legal Approach to Street Art, 30 N.Y.S.B.A. Ent., Arts & Sports L. J. 1 (2019). Republished, 91 N.Y.S.B.A. J. 8 (2019). ↑
5. VARA § 113(d)(1). ↑
6. VARA § 113(d)(2). ↑
7. Castillo v. G&M Realty L.P., Nos. 18-498-cv (L), 18-538-cv (CON), 2020 U.S. App. LEXIS 5228, at *18 (2d Cir. Feb. 20, 2020). ↑
8. The Art Law Podcast, “Moral Rights in Street Art: The 5Pointz Story” (Ap. 9, 2018), http://artlawpodcast.com/2018/04/09/5pointz-and-the-moral-rights-of-artists/. ↑
9. Cohen v. G&M Realty L.P., No. 13-CV-05612 (E.D.N.Y. filed on Oct. 10, 2013). ↑
10. Cohen v. G&M Realty L.P., No. 13-CV-05612 (E.D.N.Y. Oct. 17, 2013). ↑
11. Cohen v. G&M Realty L.P., No. 13-CV-05612 (E.D.N.Y. Oct. 28, 2013). ↑
12. Cohen v. G&M Realty L.P., 988 F. Supp. 2d 212, 214 (E.D.N.Y. 2013). ↑
13. Castillo v. G&M Realty L.P., Nos. 18-498-cv (L), 18-538-cv (CON), 2020 U.S. App. LEXIS 5228, at *5 (2d Cir. Feb. 20, 2020). ↑
14. Cohen v. G&M Realty L.P., No. 13-CV-05612 (E.D.N.Y., filed on June 17, 2014). ↑
15. Castillo v. G&M Realty L.P., No. 15-CV-3230 (E.D.N.Y., filed on June 3, 2015). ↑
16. Cohen v. G&M Realty L.P., No. 13-CV-05612 (FB) (RLM), 2017 U.S. Dist. LEXIS 50943 (E.D.N.Y. Mar. 31, 2017). ↑
17. Laura B. Richardson, The Making of the Moral Rights Case: The Factual and Legal Background of the 5Pointz Cases, Center for Art Law (Nov. 5, 2017), https://itsartlaw.org/2017/11/05/the-making-of-the-moral-rights-case-the-factual-and-legal-background-of-the-5pointz-cases/. ↑
18. Cohen v. G&M Realty L.P., 320 F. Supp. 3d 421 (E.D.N.Y. 2018). See Lise Berichel, Around the Block Ruling in 5Pointz, Center for Art Law (April 10, 2018), https://itsartlaw.org/2018/04/10/around-the-block-ruling-in-5pointz/. ↑
19. Christine Chung, LIC Community Board Changes Colors On ‘5pointz’ Towers After Library Added, The City (Oct. 4, 2019), https://thecity.nyc/2019/10/long-island-city-5pointz-towers-okayed-after-library-added.html. ↑
20. Carter v. Helmsley‐Spear, Inc., 861 F. Supp. 303, 324‐25 1 (S.D.N.Y. 1994), aff’d in part, vacated in part, rev’d in part, 71 F.3d 77. ↑
21. Martin v. City of Indianapolis, 192 F.3d 608, 612 (7th Cir. 1999). ↑
22. Castillo v. G&M Realty L.P., Nos. 18-498-cv (L), 18-538-cv (CON), 2020 U.S. App. LEXIS 5228, at *13 (2d Cir. Feb. 20, 2020). ↑
23. Castillo, at *16. ↑
24. Id. ↑
25. Castillo, at *15. ↑
26. Castillo, at *22. ↑
27. Castillo, at *23. ↑
28. Castillo, at *24. ↑
29. Cohen v. G&M Realty L.P., No. 13-CV-05612, at *30 (E.D.N.Y. Feb. 12, 2018). ↑
30. Castillo, at *22-23. ↑
31. 17 U.S.C. § 504. ↑
32. Frederick Block, Disrobed: An Inside Look at the Life and Work of a Federal Trial Judge (Thompson Reuters Westlaw, July 2017), ISBN 0314606629. ↑
33. Castillo, at *27 and *30. ↑
34. Castillo, at *27. ↑
35. Id. ↑
36. Bryant v. Media Right Prods., Inc, 603 F.3d 135, 144 (2d Cir. 2010). ↑
37. Castillo, at *29, citing S. App’x at 44. ↑
38. Castillo, at *29, citing J. App’x at 2423. ↑
39. Castillo, at *29. ↑
40. Id. ↑
41. Castillo, at *30. ↑
42. Id., citing S. App’x at 48. ↑
43. Castillo, at *30. ↑
44. Id. ↑
45. See e.g., William Charron, Painting Your Way to a Lifetime Tenancy Through the Visual Artists Rights Act, Bloomberg Law (Dec. 13, 2017), https://news.bloomberglaw.com/ip-law/painting-your-way-to-a-lifetime-tenancy-through-the-visual-artists-rights-act. ↑
46. Cohen v. G&M Realty, 2018 WL 851374, at *19 (E.D.N.Y. Feb. 12, 2018). ↑
47. Castillo, at *31. ↑
48. Id., citing S. App’x at 49. ↑

Additional sources:

• Laura B. Richardson, The Making of the Moral Rights Case: The Factual and Legal Background of the 5Pointz Cases, Center for Art Law (Nov. 5, 2017), https://itsartlaw.org/2017/11/05/the-making-of-the-moral-rights-case-the-factual-and-legal-background-of-the-5pointz-cases/.
• Lise Berichel, Around the Block Ruling in 5Pointz, Center for Art Law (April 10, 2018), https://itsartlaw.org/2018/04/10/around-the-block-ruling-in-5pointz/.

About the Author: Louise Carron is an attorney and the Executive Director of the Center for Art Law. Louise holds a Master’s of Law (LL.M) from the Benjamin N. Cardozo School of Law and a Master’s degree in Comparative Business Law from Université Paris Nanterre. Louise’s bilingual Master’s thesis on the comparative legal approach to Street Art in France and in the U.S. was published by the New York State Bar Journal (30 N.Y.S.B.A. Ent., Arts & Sports L. J. 1 [2019], republished in 91 N.Y.S.B.A. J. 8 [2019]).