Ambush Marketing in Major Sporting Events: Why Intellectual Property Protection Needs to Be Stronger

Introduction

In the world around, you might have witnessed an advertisement taking place without being in official association with the organisers or the owners, but pretends in such a way that it is officially associated with the event. This type of marketing practise is known as ambush marketing practise. At the first instance this practise may look harmless, Since the brand does not officially associate with the organisers, it may pretend to believe as there is no use or direct infringement of the logo or name of the event. So, it may feel harmless but it does not, as they are stealing the attention of the official sponsors who have paid for the rights to use the name and logo of the event, as well as decreases the market value of the brand name of the event.

Ambush marketing creates a major hindrance and an upbringing challenge in various industries; to understand it better, we shall consider the sports industry. This type of marketing strategy is not easy to tackle as it works in the legal grey zone. In this blog, we shall discuss about how this marketing threatens, works and steps needs to tackle such marketing strategies.

What Is Ambush Marketing?

When a brand, a company, or a firm does not have official rights, To associate itself, with an event, usually a major event, Presents or positions itself that creates a sense of belief among the audience As if they are associated with or have rights to associate themselves with the event, Causing a sense of ambiguity among the audience, until  Verified by the official means, It is practiced to gain advantage and attention by not being the official associate or getting rights by paying the organizers.

This type of marketing can be performed using, Subtle product placement advertising during broadcasters’ coverage or leveraging event related keywords in online advertisements. Where the offending brand does not directly breach intellectual property rights of the rightful but they create a sense of ambiguity by exploiting the events visibility and media coverage to gain commercial benefits.

How Ambush Marketing Affects Intellectual Property Rights

To gain the official rights to associate, Brands, needs to pay a premium for the exclusive advertising rights, including trademarks associated with the events. In return of the money, they are granted the legal right to associate themselves with an event through logos advertisements and product placement.

However, ambush marketing can lose trust and decrease the value of these sponsorships, potentially leading to the financial losses for the event organisers and the sponsors. Brands using ambush marketing usually avoid using logos and trademarks directly, but they exploit the event’s identity without the permission of the organisers, creating an unfair competition. This practise seems as a violation of implied rights and causes economic harm to the parties who have been invested Securing sponsorship an exclusive advertising right.

The Legal Gray Area: Does IP Law Fully Protect Against Ambush Marketing?

Intellectual property law, particularly trademark law and copyright laws, are designed in such a way to protect brands, logos and other distinctive identifiers from any unauthorised use by any unauthorised particular but in case of ambush marketing, theoretically, there is no or lack of direct infringement on these registered trademarks Complicates the enforcement.

Brands in these practises usually avoid using exact trademark, but their action creates a sense of Association of their brand with the event (not being associated), which could lead to ambiguity among the audience.

Laws governing the infringement of these rights does not completely deal with ambush marketing, hence creates a challenge of legal complexity between legitimate and non-infringing marketing actions That is strategically designed with an intention to mislead consumers into believing in association which actually does not exist.

Legal provisions: Provisions like the trademarks act 1999, sections 29(Infringement of registered trademark),30(Limits on effect of registered trademark
),135(Relief in case of infringement).

The Copyright Act, 1957, Sections 14 (exclusive right of copyright owners),51 (infringement of copyright).

Does not directly deal with ambush marketing but primarily focused towards direct infringement, where ambush marketing focuses on indirect infringement without taking or using name, logos and anything that represents about the event or the organisers without being associated with them, Creating a sense of ambiguity among the audience.

But the new consumer Protection Act 2019 brings a ray of hope, where section 2 subclause 47 deals with misleading advertisement, but still does not directly focus on ambush advertisements.

Case laws:

ICC Development (International) Ltd. v. Arvee Enterprises and Ors. (2003)

Jurisdiction: India
Key Issue: Ambush marketing and unfair association

Facts: The ICC development (international) limited was the organiser of 2003 cricket World Cup had exclusive rights to the event’s logos add other intellectual property. Arvee Enterprises, without being an official sponsor, ran an advertising campaign with slogans like “Be a part of the World Cup” and cricket imagery, creating the impression that the brand was officially associated with the tour

Decision: The honourable Delhi High Court ruled that while the advertisement does not directly infringe ICC’s Trademarks but they have harmed the economic interests of the official sponsors The court emphasised that the ambush marketing exploited the goodwill of the whole of the event and this advertisement misleads the public even if it does not violate explicitly IP rights of the organisers.

Bavaria Brewery v. FIFA (2010 FIFA World Cup)

Jurisdiction: South Africa
Key Issue: Unauthorized association and trademark infringement

Facts: During the 2010 World Cup, FIFA World Cup, Bavaria brewery, A Dutch company, distributed bright orange dresses to the audience of the match between Netherlands and Denmark featuring its logos. The fans with the orange dresses featuring the logo of the brand, this move became instant to hit and viral sensation despite Bavaria not being an official sponsor of the event. Later, FIFA, whose official sponsor was Budweiser claimed that a stunt violates its trademark and marketing agreements.

Decision: FIFA, initiated a legal action, and the 2 women who were representing Bavaria’s dress were arrested under the South African, anti ambush marketing laws. This case was later settled, out of the court, but sparked a widespread debate over the legality and the ethics of ambush marketing.

Famous instances which do not face legal actions, Coca Cola versus Pepsi co. (1996 cricket World Cup), Nike versus Adidas (1996 Atlanta Olympics), American Express versus Mastercard (1994 Winter Olympics).

The Need for Stronger Enforcement of IP Rights in Sports

To deal with the increasing rate of ambush marketing instances, we need and stronger enforcement mechanism. Some of them could be considered as:

• Tighter Regulations Around Marketing at Sporting Events: Event organisers can enter into contract with sponsor, ensuring with more robust terms and conditions regarding ambush marketing.
• Legislative Action: Government and sporting organisations may need to push for an updated intellectual property law that can specifically target these legal grey areas created by ambush marketing, Despite the fact, with a new consumer Protection Act, 2019 deals with misleading advertisements but to tackle this ambush marketing, we need a proper legislative action.
• Stronger IP Protections for Event Brands: There should be a proper copyright and trademark protection for the event’s brands, such as their official merchandise, intellectual property or anything that is associated with the event. This could help in combating ambition marketing.

Conclusion: Why IP Law Needs to Adapt to the Digital Age of Sports Marketing

Ambush marketing strategy or technique is a significant challenge to the traditional understanding of intellectual property laws. It also exposes and opens up the door for laws adapting according to the new challenges. In digital arena, brands get the access of new platforms, used for, marketing and advertising. They can target audience in more subtle, indirect ways that fall outside of the scope of the current IP provisions and protections.

By strengthening the intellectual property enforcement, protecting sponsors, organisers and integrity of official partnership, the new adapted legal framework can work much better and support the commercialization and its related activities. It will also support the value of exclusivity in advertising industry.

Author: Ashish kumar, in case of any queries please contact/write back to us at support@ipandlegalfilings.com or IP & Legal Filing

References

• Ambush Marketing in Sports – Sports Law Journal, 2021
• Intellectual Property Rights and Sponsorships in Major Sports Events – IP & Sports Law Review, 2020
• Nike and Adidas: The Ambush Marketing War – Sports Marketing Weekly, 2015
• ICC Dev. (Int’l) Ltd. v. Arvee Enters. & Ors., 2003 (26) PTC 245 (Del).
• FIFA v. Bavaria Brewery, Case No. 10/2010, High Ct. of Gauteng Prov., S. Afr. (unreported, settled out of court).
• David L. Kurtz, Contemporary Marketing, 3rd ed. 1997
• Aaron Smith, The Battle for the Cricket World Cup: Ambush Marketing and the Pepsi-Coke Rivalry, 10 & L.J. 45 (1997).