AMBUSH MARKETING: AN UNFAIR COMPETITION REGIME
Author: Ananya P Muralidhar,
3rd Year B.A. L.L.B Course,
School Of Law, CHRIST (Deemed To Be University).
Ambush marketing refers to an effort by a corporation to capitalize on the success of a well known property or occurrence, without the appropriate parties’ permission or authorization. It ia a marketing stratergy in which a rival brand is synonymous with major sporting events without paying sponsorship fees. This can be by an attempt by a third party to create a direct or indirect association with an event or its participants which results in direct or indirect unauthorized use of the trademark and copyright of the organizers of the event. This can be by the use by the third parties of the registered event logo or goods, false declarations to be official vendors of a specific team etc. In recent years, Ambush marketing has emerged as an important, if contentious, tool in marketing departments’ arsenal. To manipulate international events such as the Olympics, the Football World Cup, or the Commonwealth Games, numerous companies have indulged in ambush marketing. This can be by the use by third parties of the licensed event logo or products, misleading statements to be official suppliers of a given team, etc. Explicit violations in certain forms of ambush marketing can be resolved by existing laws, but there is no clear cut off solution under existing laws in cases where there is indirect ambush marketing.
Another reason for the existence of the practice of ambush marketing activity is that competitions such as World Cup, Super Bowl or Olympics are short-lived, making it difficult for event organizers to use their legal option to curb these practices. In comparison, there are such few case laws dealing with the same on in India and only a handful of cases have currently passed through the judicial system as so far very few promoters or sponsors have brought prosecutions against ambush marketers, for example, misappropriation of the league domain. Additionally, the lack of any Intellectual Property Legislation to tackle the same makes it extremely difficult to bring these lawsuits within the framework of current copyright trademark law. This has resulted in the event organizers seeking legal recourse as there is a lack of case laws on ambush marketing, and a court ruling in favour of an ambush company could set a precedent that could be used by any other organization carrying out an ambush operation.
The issue surrounding Ambush marketing are twofold, one being the business issue involving the sponsors’ involvement and other being the issue of trademark and copyright. The expense in international sporting event. So when advertisers buy the right to use the “event logo”, they search for demand to be generated in order to get compensation from that investment. This necessitates regulatory interest in avoiding deceptive selling in countries where these activities are coordinated to ensure that consumer rights are protected. Ambush marketing associated with trademark issue is distinctive. Various words used during such international sporting events could be symbolic in definition, such as “World Championship” in the case of FIFA, and in these cases there is a need for special protection to shield these participants from others who will be free riding on them.
In order to have a legitimate claim against ambush marketers, the event organizer would need to show that, (i) it has an established reputation or goodwill with reference to the event in question (ii) the third party has made a misrepresentation by way of its marketing, which has led the public to believe that there is a connection with that party and the event organizer (iii) it has suffered or is likely to suffer damage as a result of this confusion.
In the case of ICC Development International Ltd v Arvee Enterprises and Anr.,16 ICC Development (International) Ltd had filed a suit for injunction pleading that the plaintiff company was formed by the members of International Cricket Council to own and control all its commercial rights including media, sponsorship and other intellectual property rights relating to the ICC events. The appellant had created a distinct ‘logo’ for the case and a ‘mascot’, members of the public specifically identified the same with the mascot. It had filed applications in several countries for approval of its trademark. In India, it had applied for the registration of the words “ICC Cricket World Cup South Africa 2003” and “Dazzler” logo and mascot ICC events were pleaded to have gained their own “persona” or “identity”. The official sponsors of the World Cup were : (i) Pepsi, (ii) Hero Honda, (iii) LG Electronics, (iv) South African Airways, (v) Hutch- Orange, (vi) Standard Bank-South Africa (vii) Toyota- South Africa (viii) South African Breweries (ix) MTN.
Arvee Enterprises was the authorised dealer for sale and service of electronic goods manufactured by the second defendant-Philips India Ltd. They misrepresented their affiliation with the plaintiff and the World Cup, through advertising ads like newspapers, tv, internet, and magazines and through the use of said offending logos with the purpose of unfairly deriving commercial advantage from connections with plaintiff and World Cup, thus attempting to piggyback on the plaintiff’s credibility.
The court rejected the appeal on the grounds that the ICC emblem was not misused and therefore there was no room for any inference among the purchasers of the defendant’s products that there was any link between the defendant and the official sponsors of the events. However, in the case of ICC Development vs. EGSS, injunction was granted against the misuse of the ICC logo by the defendants. The logo was held to be an artistic work under the Indian Copyright Act.
Hence, it becomes very clear that the current intellectual property regime is only partially suited to combat ambush marketing and therefore, there is a serious need for legislation in India.
Freedom of speech and expression under Article 19(1)(a) of the Constitution of India lays down certain restriction which can be imposed on fundamental rights guaranteed under this Article. Commercials that are descriptive, unfair, misleading and untruthful and would be guarded by this Article. The third parties practicing ambush marketing can easily get away and escape liability by proving that they were merely conveying some information through the advertisement. While competition law attempts to ensure that the legislation of competition in the market place by giving fair chance to everyone to compete, intellectual property right tries to anticipate others from interfering in the rights of intellectual property owners. The interference of competition law with anti-ambush marketing measures can broadly focus on two types of issues, those relating to the restrictions on product and services in and near the venue. It raises two questions, whether the event-specific legislations and other regulations against ambush marketing are anti-competitive in nature and whether the anti-ambush marketing measures and legislations pave way for the abuse of a dominant position by the event organizers.
India can bring about certain legislations by looking into the actions taken by other Nations. In South Africa, Section 9(d) of the Trade Practices Act, 1976 states that ‘no person shall, in connection with a sponsored event, make, publish or display any false or misleading statement, communication or advertisement which represents, implies or suggests a contractual or other connection or association between that person and the event or the person sponsoring the event, or cause such statement, communication or advertisement to be made, published or displayed’. Thus, during FIFA 2020 World Cup which qualified as a sponsored event, any ‘association’ that would have suggested ambush marketing would have breached the Trade Practices Act. The Merchandise Marks Amendment Act, 2002 defines ‘event’ and ‘protected event’ and authorizes the Minister of Trade and Industry to protect certain events. The 2010 FIFA World Cup was designated a ‘protected event’ under Section 15A of the Merchandise Marks Act, 1941. Under this section ‘for the period during which an event is protected, no person may use a trademark in relation to such event in a manner which is calculated to achieve publicity for that trademark and thereby to derive special promotional benefit from the event without the prior authority of the organizer of such event’. Several such special legislations have been adopted by China, New Zealand , England and Australia to face the issue ambush marketing during the Sporting Event Seasons.
Thus, this shows that due to the absence of principle legislations and case precedents, corporations indulging in ambush marketing are able to get away scot-free. To overcome this problem, various countries such as South Africa, New Zealand, Australia, China, England, Brazil and Canada have brought out amendments or legislations defining ‘ambush marketing’ as a specific type of IPR infringement and fixing liability for the same. It is time that India considers introducing such a legislation not just because its peers have taken such a step but because in the light of large scale events being organized in the country, there is a need to protect legitimate sponsors.
· Rukmani Seth, Ambush Marketing – Need for Legislation in India, 15 JOURNAL OF INTELLECTUAL PROPERTY RIGHTS pp 455-463, November 2010.
· National Hockey League v Pepsi- Cola Ltd, 92 DLR 4th 349.
· Hugh C. Hansen, “Event-Driven Marks and “Ambush” Marketing.” INTELLECTUAL PROPERTY LAW AND POLICY, Volume 11 pp. 561–586, Ed. London: Hart Publishing, 2010. Bloomsbury Collections.
· ICC Development (International) Limited v Arvee Enterprises and Anr, (2003) Indlaw DEL 300, 2003 (26) PTC 245.
· ARUL GEORGE SCARIA, AMBUSH MARKETING – GAME WITHIN A GAME, (Oxford Publication, 2008).