Trademarks and Their Applicability in Various Avenues of the Sporting World

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Trademarks and Their Applicability in Various Avenues of the Sporting World

Author: Sachit Ram

3rd Year B.A.L.L.B.-A,
 School of Law, Christ University

Trademarks and their Laws:

Trademark law governs the use of a device (including a word, phrase, symbol, product shape, or logo) by a manufacturer or merchant to identify its goods and to distinguish those goods from those made or sold by another. Service marks, which are used on services rather than goods, are also governed by ‘Trademark law.’ In the United States, certain common law trademark rights stem merely from the use of a mark. However, to obtain the greatest protection for a mark, it is almost always advisable to register the mark, either with the federal government, if possible, or with a state government. A mark which is registered with federal government should be marked with the ® symbol. Unregistered trademarks should be marked with a “tm”, while unregistered service marks should be marked with a “sm”.

A mark is infringed under U.S. trademark law when another person uses a device (a mark) so as to cause confusion as to the source or sponsorship of the goods or services involved. Multiple parties may use the same mark only where the goods of the parties are not so similar as to cause confusion among consumers. Where a mark is protected only under common law trademark rights, the same marks can be used where there is no geographic overlap in the use of the marks. Federally registered marks have a nation-wide geographic scope, and hence are protected throughout the United States[1].
With regard to India, trademark law conforms to its obligations under the TRIPS Agreement[2]for protection of trademarks, i.e., include protection to distinguishing marks, recognition of service marks, indefinite periodical renewal of registration, abolition of compulsory licensing of trademarks, etc.

With the globalization of trade, brand names, trade names, marks, etc. have attained an immense value that require uniform minimum standards of protection and efficient procedures for enforcement as were recognised under the TRIPS. In view of the same, extensive review and consequential amendment of the old Indian Trade and Merchandise Marks Act, 1958[3]was carried out and the new Trade Marks Act, 1999[4]was enacted. The said Act of 1999, with subsequent amendments, conforms to the TRIPS and is in accordance with the international systems and practices.

The Trade Marks Act provides, inter alia, for registration of service marks, filing of multiclass applications, increasing the term of registration of a trademark to ten years as well as recognition of the concept of well-known
marks, etc. The Indian judiciary has been proactive in the protection of trademarks, and it has extended the protection under the trademarks law to Domain Names as demonstrated in landmark cases of Tata Sons Ltd. v. Manu Kosuri & Ors,[5]and Yahoo Inc. v. Akash Arora[6].

India, being a common law country, follows not only the codified law, but also common law principles, and as such provides for infringement as well as passing off actions against violation of trademarks. Section 135 of the Trade Marks Act[7]recognises both infringement as well as passing off actions[8].

Article 6 of the Paris Convention Treaty states:
MARKS: CONDITIONS OF REGISTRATION; INDEPENDENCE OF PROTECTION OF SAME MARK IN DIFFERENT COUNTRIES
(1) The conditions for the filing and registration of trademarks shall be determined in each country of the Union by its domestic legislation.
(2) However, an application for the registration of a mark filed by a national of a country of the Union in any country of the Union may not be refused, nor may a registration be invalidated, on the ground that filing, registration, or renewal, has not been effected in the country of origin.
(3) A mark duly registered in a country of the Union shall be regarded as independent of marks registered in the other countries of the Union, including the country of origin[9].
The aforementioned Convention is permissible only for those Unions/countries that have ratified the Convention as specified under Article 20[10].
This illustrates the regulations and basics when it comes Trademark Law both in India and internationally.

Trademarks in Sports and the Relevant Laws:

The Sports industry has always been a massive sector across the world bringing together entertainment, games, culture and monetary business, right from the barbaric era through the glorious days of Caesar to the twenty first century money making sports industry. Sporting games have always been encouraged by rulers, governments, private individuals and entities interested not only in the games themselves but more in the monetary business quotient that sports entail.

The sporting events are no more what they used to be. Cash-rich globalization has acquired an enormous role in all sporting events. Corporatization of sports has become monumental. Marketing through franchising, as well as brand building of the sports, sportsmen and the event has gained gigantic importance, surpassing all other major aspects of a game.

With the business angle of sports growing by the day, dormant intellectual property rights (IPRs) vested in almost every component of the sports industry are being tapped into and capitalized.

Trademarks in sports play an important role in the sports business. With the inception of branding of sports events through the presence of features like a logo, captions, taglines, slogans and team names etc. (collectively referred as trademarks), brand value is created in sporting teams, clubs, players, merchandise etc. Team names and symbols create a level of association with the public and fan following helping the popularity ratings of any given team, club, player etc. Even the names of the players have acquired the status of trademarks due to their celebrity status. This popularity and brand image eventually converts into monetary profit through advertisements, brand ambassadors, goodwill and reputation of the sponsors etc.[11]

 Interestingly enough, violation of a trademark is a cognizable offence in India and criminal proceedings against the accused can be initiated. Such enforcement mechanisms are initiated, to enhance the protection of trademarks in India and minimalize infringement and contravention with respect to trademarks.

The Madrid System:

The Madrid System of registering Trademarks is one of the most efficient in the world when it comes to convenience and cost. You can apply and pay fees for a trademark and register it in 116 countries.

If you have a personal/business connection to one of the members, you can use the System. Thus, the requisite is to be domiciled, possess a commercial establishment in, or have citizenship in one of the 116 countries encapsulated within the system.

An international trademark registration costs a basic fee of 653 or 903 Swiss Francs, based on color. There are additional costs on the basis of where the mark is wished to be protected and the number of classes of goods and services that shall be covered through registration.

After obtainment of an international mark registration, additional fees could be paid to extend geographical scope of coverage, modification or renewal of our portfolio.[12]

The Importance of Trademarks:

      ·       They are valuable assets
      ·       Thy build confidence, trust and loyalty in products
      ·       They represent a promise, if successful

The magnanimous display of trademarks at massive, prestigious sporting evnts, increases the sales, by its appeal to the emotions and aspirations of sporting fans who are attracted to associations with the club or the sport. These marks can also become symbols of a certain behaviour or a certain lifestyle. Thus, sponsorship of such prestigious events can causally link it to the youth and dynamism of the event.

The financial health of most sports organizations, clubs, and individual athletes is hugely dependant on this brand advertising that uses these spots teams. The brand has proportionally more value, with the success of the team, leading to a higher income and spending power. This additionally enhances the entertainment value of the matches because the club has the financial resource to invest in infrastructure and quality players. Successful examples are that of the NBA (National Basketball Association) in the U.S., and the English Premiere League in the U.K.[13]

We now see many sportspeople wearing their kit with emblematic mark signs. Many players have even become advertising icons for a product or service mark, and many in fact obtain more income from the lucrative contracts which they sign with sponsors to advertise their products and services than they do for their sporting or professional activity.

This shows us the importance which trademarks have in sport. This importance is neglected when the trademarks are not registered, when registration is considered as an administrative expense, and not as an investment which may protect the company from bankruptcy[14].

Examples of Trademark Infringement:

Lucky 13 v. Taylor Swift:
Taylor Swift recently settled a lawsuit brought by Blue Sphere, a clothing company that owns the “Lucky 13” trademark. The organization filed when Swift began selling fan merchandise marked “Lucky 13,” and launched a “Lucky 13” swe
epstakes among other activities.
While Swift insisted that 13 was just a lucky number to her and claimed “harassment” by the plaintiff, the results of the lawsuit were not released publicly. A confidential agreement was reached out of court, and Swift has begun proactively trademarking other phrases and lyrics she uses often to avoid future issues.Verdict Out-of-Court, Confidential.
Starbucks v. Freddocino[15]:
In January 2016, Starbucks filed a lawsuit against the parent company of New York’s Coffee Culture Cafe for launching a drink called the “Freddocino” The lawsuit’s documents allege not only does the drink appear similar to the Frappucino, the structure of the name contains enough similarities to cause “confusion in the marketplace” and diminish “Starbuck’s brand equity.”
Starbucks does own the trademark for the term Frappucino, and additionally alleged that Coffee Culture has created deceptive packaging to make it appear the term “Freddocino” is trademarked when it is not. While Coffee Culture Cafe has changed the name of the drink to a “Freddo,” Starbucks is proceeding with the lawsuit. Coffee Culture could have avoided the issue by avoiding infringement on a closely-guarded trademark, with an annual value of approximately $1.5 billion.
American Eagle v. Pantaloons[16]:
The parent company of clothing retailer American Eagle, Retail Royalty Company, has filed in the Delhi high court against Pantaloons Fashion & Retail. The lawsuit alleges that the “brand and logo are deceptively similar to its American Eagle Outfitters brand and logo.”
While Retail Royalty Company is US-based, this case is far from the first example of international retail copyright infringement. Fashion United reports that Gap has also recently filed against India-based brands selling under the name “Gap Two” Even for organizations that are not international, it can be critical to monitor your trademarks on an international scale.
In most cases discussed here, the outcomes could have been completely avoided with more effective trademark research. There’s no question that a trademark search can be time-intensive and confusing, especially if it’s done right. Human error and incomplete searches can open your brand to enormous risks, such as those seen in these lawsuits[17].
Conclusion:
This research paper has tried to accomplish a comprehensive overview of trademarks. It first deals with the fundamentals of trademarks, the various Conventions and laws governing it and its importance in today’s global sphere of sports. It has also pointed out how trademarks, when misrepresented and unclear, can lead to serious Intellectual Property damage and financial loss as seen in the cases referred to in this paper. This paper has also illustrated the easiest and most cost-efficient methods of trademarking in sports.

[1] https://www.bitlaw.com/trademark/index.html


[2] TRIPS Agreement

[3] Indian Trade and Merchandise Marks Act,1958

[4] Indian Trade and Merchandise Marks Act,1999

[5] [90 (2001) DLT 659]

[6] [1999 PTC 201]

[7] Sec. 135, Trademarks Act, 1999

[8] Article by Vijay Pal Dalmia, Advocate Partner & Head of Intellectual Property Laws Division, Vaish Associates Advocates, New Delhi India, updated 31 march 2011

[9] Art. 6, Paris Convention for the Protection of Industrial Property amended 1979

[10] Id, Art. 20

[11] Article by Vijay Pal Dalmia, Advocate, Supreme Court of India and Delhi High Court, Partner & Head of Intellectual Property Laws Division, Vaish Associates Advocates, India and Christine Chiramel, Advocate, updated 7 Feb,2011

[12] http://www.wipo.int/madrid/en/

[13] http://www.wipo.int/ip-sport/en/branding.html

[14] http://clarkemodet.com/en/news/blog/2010/06/Trademarks-and-Sport-the-importance-of-their-protection.html#.WpvDy2pubIU

[15] Case 1:16-cv-00029 Document 1 Filed 01/11/16

[16] (CS(OS)2872/2015)

[17]TrademarkNow.  September 6, 2016. https://www.trademarknow.com/blog/9-nasty-trademark-infringement-cases-and-how-to-avoid-them
                                                       

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