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Michael Jordan’s victory in the dispute about the unauthorised usage of his name in an advertisement by a supermarket shows once again the potential pitfalls that can be faced in advertising campaigns.
Michael Jordan’s case
One of the most famous quotes from Michael Jordan is
I play to win, whether during practice or a real game. And I will not let anything get in the way of me and my competitive enthusiasm to win.
Despite of this “warning” message, a supermarket chain published in 2009 an advertising page on Sports Illustrated promoting a product by using Michael Jordan’s name without his permission.
The matter did not please MJ that brought a claim against the supermarket chain and the Federal Court of Chicago now held that the owner of a supermarket chain must pay Michael Jordan $8.9 million in damages. The amount of damages was so high because a sports economist testified that Jordan’s fair market value for the advertisement was $10 million.
When can you use third parties’ brands?
The episode involving Michael Jordan was quite unusual, but it is surprising that often promoters believe to have the liberty to quote or refer to other brands to advertise their products with no restriction. A typical example is when branded products are offered as prizes during a prize promotion or when it is necessary to refer to a social media because this is the channel through which the product is advertised.
In such cases a reference to the offered prizes/brand is necessary, but legal restrictions may apply to the usage of trademarks and images of products as part of marketing initiatives.
The two main intellectual property principles to consider in assessing the legality of such practice are:
1.Principle of exhaustion of trademark rights
The principle of the exhaustion of the rights conferred by a trademark provides that a trademark owner is not entitled to prohibit the usage of his trademark in relation to goods which have been put on the market in the European territory under that trademark by the owner or with his consent.
2.Principle of usage of trademarks with descriptive purposes
The principle of usage of third parties’ trademarks with descriptive purpose prescibes that trademark rights shall not entitle the owner to prohibit a third party from using it where it is necessary to indicate the intended purpose of a product or service which might include also the advertising channel through which it is distributed or promoted such as a social media.
Is your advertising campaign in safe hands?
It depends…
The main issue pertains to the restrictions applicable to the above mentioned principles that shall be assessed on the basis of the peculiarities of prize promotions and of the relative advertising campaign. These complications are coupled in Italy with formalities required for the organization of prize promotions outlined here and become even more burdensome for prize promotions run on social media that however as stressed in this post might be challenged.
And the right answer depends also on the jurisdiction since apparently Michael Jordan lost a trademark dispute against a Chinese sportswear company appropriating his name and brand as showed in the image in this blog post…
This is a very interesting area of disputes and if you found this article interesting, subscribe to my newsletter so you will not miss next blog posts!
