It would work in
SL the same as it works everywhere else for every other career that produces an intangible, copyable, result.
Suzy swimsuit seller does exactly what she does today, she builds a brand. When I want clothes in
SL, I go to Simone's store. I don't go shopping at random crappy Brazilian malls.
The community is also stepping up to publicly ridicule and call out infringement. This should continue, and is probably more effective than any lawsuit ever will be. It's how most open source license violation enforcement is done, and has been effective there.
Linden Lab needs to fix their glacial pace. The DMCA requires timely takedowns. "the service provider [must respond] expeditiously to remove, or disable access to, the material that is claimed to be infringing upon " (Chapter 5 Section 512). LL actually loses protection under the DMCA if they don't do this.