Trademark Law | Sony Walkman | FIFA | Pepsi

Lawless Branding: Recent Developments in Trademark Law

Sony Loses Exclusive Walkman Rights

Austria's supreme court has ruled that the word "Walkman" is now a generic term and the common trade name for portable cassette players. As a result, Sony loses its exclusive monopoly right to the name "Walkman" in Austria in respect of portable cassette players, and further challenges may result in similar court decisions.

The case began in 1994 when Sony sued Time Tron Corporation for trademark infringement. In its sales brochure, the Austrian company described portable cassette players made by several different manufacturers as "Walkmans." Sony claimed this activity infringed on its registered trademark.

In reaching its decision, the Austrian court was persuaded in part by the fact that "Walkman" was defined in a German dictionary as "any portable stereo player." This indicated that the "Walkman" brand had become a victim of its own success and become the common term for portable cassette players.

Following the decision, a spokesperson for Sony said that "Walkman" was not a common noun to be used by anyone, adding, "We are not satisfied with the ruling and we will continue to seek ways to protect the name."

It is always a question of fact as to whether a trademark has become the common name in the trade for a product or service. It will depend on substantial evidence from the trade showing the mark in use as the common name for a relevant product or service. The recent Austrian decision highlights the importance of ensuring that a trademark is used as a "badge of origin," that is an indication that goods sold under it are produced by or with the authority of the brand owner rather than as a description of the nature of the goods.

To protect against such devastating court decisions, businesses often go to great lengths to police the use of their registered trademarks, whether the use is with their consent or by those that would take advantage of their intellectual property rights. The most basic method of indicating that a mark is being used as a trademark is by the use of the letters "TM." Where a mark is registered, the "®" symbol can be used. However, claiming that a mark is registered when it is not is illegal in some countries, such as the UK, and is punishable by a fine.

Businesses can draw up guidelines to advise manufacturers or distributors on the correct use of their trademarks. These might include identifying trademarks in marketing materials with the "TM" letters or "®" symbol. If the mark has a color, the guidelines might state the correct Pantone number that must be used. The guidelines may also provide that failure to implement the guidelines may result in the termination of any agreement between the parties.

Fifa Defends World Cup Against Pepsi Ambush Marketing

While football fans have been enjoying the World Cup, off the pitch FIFA has been cracking down on companies and individuals attempting to "ambush" the 2002 FIFA World Cup through various activities infringing its intellectual property rights.

Since the conclusion of the 1998 World Cup in France, FIFA has been using a specialized "anti-ambush" team, comprising trademark specialists, commercial lawyers and sports marketing specialists. Their strategy for this World Cup began with a worldwide trademark registration program of "FIFA World Cup," the official mascots, the official emblem and the FIFA World Cup Trophy. These measures were taken to ensure that FIFA is in strong position to protect and enforce its intellectual property rights and the rights of the official partners, the official suppliers and licensees.

One of the highest profile examples of FIFA's enforcement activities involves the soft drink manufacturer Pepsico. Although Coca-Cola is one of the FIFA World Cup's official partners, rival Pepsico has produced advertisements that suggest a sponsorship relationship between it and the FIFA World Cup.

On 5 June, an Argentinean court ordered Pepsico to immediately cease the use of an advertisement. The court found that the prohibited advertisement would cause confusion among consumers as it suggested a "presumed sponsorship relationship" between Pepsico and the FIFA World Cup. The advertisement in question combined the use of the phrase "Tokyo 2002," famous footballers and other football imagery in association with the logo of Pepsico. The court ordered Pepsico not to use the advertisement on TV, in printed media or by any other means.

Had FIFA decided not to act, its inactivity would have diminished the value of its trademarks as well as the exclusivity of agreements with official partners such as Coca-Cola. Patrick Magyar, CEO of FIFA Marketing, commented, "FIFA regrets that corporations engage in ambush marketing activities, and is particularly disappointed to see a global company like Pepsico employing these below-the-belt techniques that harm the FIFA World Cup - they should know better. Pepsico knows full well that all marketing rights and benefits of the FIFA World Cup are exclusively granted to the official partners, official suppliers and licensees, whose significant financial support helps stage this great event and enhances the FIFA World Cup experience for fans in Korea and Japan and throughout the world."

The Argentinean court order comes on the heels of Pepsico's claims earlier in the week that their advertising will not mention the FIFA World Cup. However, this is not the only promotion related to the FIFA World Cup which has caused Pepsico to be in hot water with FIFA: in Ecuador, FIFA has also instructed counsel to initiate legal proceedings against Pepsico as a result of similar TV commercials; and in Mexico, Pepsico is in the midst of negotiations with FIFA to settle a case involving the unauthorized use of FIFA's trademark-protected emblem of "2002 FIFA World Cup."

Businesses spend considerable time and substantial sums of money devising brands and marketing their products or services. This investment should be protected whenever possible by registering trade names, logos, strap-lines and other trademarks. If a trademark is registered, the registration gives the owner a monopoly right in that country to use the mark in respect of the goods or services in which it is registered and provides protection against infringement.

[24-Jun-2002]

Ed Meikle is an intellectual property solicitor at Dickinson Dees, a UK law firm based in Newcastle upon Tyne. He specializes in contentious and non-contentious intellectual property law, relating principally to trade marks, copyright, designs and patents. He advises extensively on the commercialization, protection and enforcement of all such rights.


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