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Fast fashion retailer Shein has been accused by independent designers of infringement-related racketeering activities in a new lawsuit. According to The Fashion Law, a lawsuit was filed on Tuesday (11 July) in California federal court that accused the clothing giant of using a “secretive algorithm” to identify trending art and allegedly reproducing the independent designs for its fast fashion website. The three independent artists suing Shein – Krista Perry, Larissa Martinez, and Jay Baron – claimed both Shein and its parent company, Zoetop Business Company, Ltd, engaged in “produc[ing], distribut[ing], and selling exact copies of their creative works,” which they allege is “part and parcel of Shein’s ‘design’ process and organizational DNA.” In the suit, Perry, Martinez and Baron claim Shein replicated “truly exact copies of [their] copyrightable graphic designs” such as Berry’s artwork titled “Make It Fun” and Blintz’s “Orange Daises” design. Barron’s “Trying My Best” artwork, which they claim was also copied by Shein, is not only a registered copyright but the phrase was also trademarked by Barron. As a result, the plaintiffs argue that they “have suffered and will continue to suffer substantial damage” to their businesses and “a diminishment in the value of their designs and art, their rights, and their reputations”. In the complaint, the plaintiffs allege that Shein created a “secretive algorithm” to identify growing fashion trends and “produce very small quantities of [its] item for sale” – as 100-200 units per SKU – in the case that an artist claims “the design was stolen”. “The brand has made billions by creating a secretive algorithm that astonishingly determines nascent fashion trends – and by coupling it with a corporate structure, including production and fulfillment schemes, that are perfectly executed to grease the wheels of the algorithm, including its unsavory and illegal aspects,” the artists argue in the suit. “When Shein copies a small or independent designer, the most likely outcome (without brand protection specialists and specialized software on the lookout) is that the infringement will go unnoticed,” the complaint reads. The lawsuit named Chris Xu as the maker behind the algorithm, a “mysterious tech genius” who has allegedly made Shein “the world’s top clothing company through high technology, not high design.” While Shein has faced many lawsuits in recent years, the newest complaint is notable for its Racketeer Influenced and Corrupt Organizations Act (RICO) claim. RICO is a federal law designed to combat organized crime in the United States, and individuals or organisations can use the RICO Act to file civil claims against racketeering activities performed as an ongoing criminal enterprise. Another requirement to file a RICO claim is that the offending party is not just an individual or business but a criminal organization, as the suit claims Shein’s alleged infringement activity is “committed not by a single entity, but by a de-facto association of entities.” The plaintiffs claim that Shein’s “confusing corporate structure” allows the company to “avoid liability” in the case of intellectual property infringement, adding that the brand’s “first line of defense” when facing a copyright or trademark cease and desist is “removing the product from its sites with blaming the misconduct on another [Shein entity] actor (implying such actor is independent).” As a result, the artists have accused Shein of “multiple acts of racketeering and criminal copyright infringement” and are seeking past and future damages, as well as compensation for legal fees and injunctive relief to “prevent further racketeering activity”. This is not the first time Shein has faced accusations of infringement. In May, artist Maggie Stephenson settled with Shein for an undisclosed amount after she filed a $100 million lawsuit last year. That same month, Italian fashion designer Giuliano Calza claimed the retailer stole shoe designs from his streetwear label, GCDS. The new lawsuit comes after a Shein-sponsored influencer trip made headlines for promoting Shein’s factory in Guangzhou, China. The influencers were invited to tour Shein’s “innovation factory”, as they posted videos showing a clean, brightly lit factory with automated bots assisting in processing and packaging orders. However, the influencer trip faced backlash as many pointed out the fast fashion company’s accusations of labour abuse and its negative impact on the environment. The Independent has contacted Shein for comment. Read More Italian designer launches scathing attack on Shein over ‘stolen ideas’: ‘Maybe I am the fool’ Influencers face backlash for promoting Shein factory during PR trip in China Parent company of fast-fashion brand Shein to pay New York state $1.9m for data breach Shein accused of racketeering and copyright infringement in lawsuit Barbie premiere: All the best pink carpet looks as Margot Robbie film shows in London Why these women are – and aren’t – shaving their armpits this summer

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Hollywood’s actors and writers have both gone on strike for the first time since 1960 to protest against a number of decisions by major studios that include not just job cuts but also a potentially unsettling future in which they could be replaced by artificial intelligence. The leaders of SAG-AFTRA, the Hollywood union representing 160,000 television and movie actors, went on strike on Thursday, joining the industry’s screenwriters who have already been picketing for over 70 days. Among the many issues flagged by both the writers and actors in the protests has been how generative AI tools could replace their roles in the industry. Over the last decade, AI has found several uses in the movie and television industry, from de-aging actors, analysing patterns and behaviours of viewers on streaming platforms, bringing back the voices of late actors and even helping stitch together entire movie trailers. One of the proposals, as explained by SAG-AFTRA’s national executive director and chief negotiator Duncan Crabtree-Ireland, feels like it is straight out of dystopian science fiction series Black Mirror. During a press conference on Thursday, Mr Crabtree-Ireland alleged that a proposal from Hollywood studios was to use “groundbreaking AI” to scan background performers and only offer them a day’s pay while the companies get to own the scans and use them for any project they want. “This ‘groundbreaking’ AI proposal that they gave us yesterday, they proposed that our background performers should be able to be scanned, get one day’s pay, and their companies should own that scan, their image, their likeness and should be able to use it for the rest of eternity on any project they want, with no consent and no compensation,” the executive said. “If you think that’s a groundbreaking proposal, I suggest you think again,” Mr Crabtree-Ireland said. A statement from the Alliance of Motion Picture and Television Producers (AMPTP), that represents the studios, claims the “groundbreaking AI” proposal “protects actors’ digital likenesses for SAG-AFTRA members”. “We are being victimized by a very greedy enterprise... The entire business model has been changed by streaming and AI If we don’t stand tall right now, we are all going to be in jeopardy,” the actors’ guild president Fran Drescher said on Thursday. Follow along here for real-time updates on the SAG-AFTRA strike Writers who have already been protesting since May have also sought assurances from studios that their jobs would not be threatened by AI. With the steady rise of online streaming services looking to rack up user subscriptions by churning out endless amounts of digital content, writers on strike have sought new pay structures, guaranteed periods of work as well as better discussions on the limits of AI use. Members of the Writers Guild of America (WGA) shared concerns that producers may seek to use AI to write scripts or at least use the technology to complete unfinished screenplays, and have also urged production houses to agree to safeguards around its usage. Screenwriters fear AI could be used to churn out a rough first draft with a few simple prompts and writers may then be hired after this initial step to punch such drafts up – albeit at a lower pay rate. Without further dialogue with studios, writers have raised concerns there could be a number of new ways that AI could be used to craft outlines for stories, fill in scenes and even come up with mock-up drafts. “There are ways it can be useful. But too many people are using it against us and using it to create mediocrity. They’re also in violation of copyright. They’re also plagiarizing,” Michael Winship, president of the WGA East, said in May. With these risks in mind, the WGA seeks more safeguards on how AI can be applied to the screenwriting process. Read More Hollywood actors and writers strike after ‘disgusting’ studios turn down deal. Here’s what it means for you Hollywood in historic shutdown as actors union joins writers strike: ‘The eyes of the world are upon us’ Cast of Oppenheimer walk out of UK premiere ahead of actors’ strike announcement What happens next as striking actors send Hollywood into meltdown? Issa Rae and Jamie Lee Curtis lead A-listers voicing support for actors strike Hollywood in historic shutdown as actors union joins writers strike

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