Kicking Goals in Ambush Marketing

With the FIFA World Cup fast approaching, the issue of ambush marketing is again at the forefront of discussion. Forming a key concern for event organisers, partners, sponsors and fans, ambush marketing is an attempt by a third party to create a direct or indirect association with a sport event or its participants without their permission. Major sports events, including the upcoming FIFA World Cup, present excellent opportunities for international brand exposure, so it comes as no surprise that entities engage in ambush marketing in an attempt to reap the associated commercial benefits of such coverage.

Image: Dirk Vordestrasse

The last decade has seen a broad range of ambush marketing techniques come into play around major sporting events, with non-official sponsors striving to have their brands in the limelight. Colourful examples include the 2006 FIFA World Cup which left official sponsor, Budweiser outraged after the mass provision of bright orange lederhosen by Bavarian Brewery to fans attending games, or the more recent targeting of professional athletes by Beats Electronics at the London Olympics, where the recognisable oversized Beats headphones were given to athletes for free and as a result appeared extensively in Olympic television coverage.

The popularity of ambush marketing lies in its cost effectiveness. A successful ambush marketing campaign after all, will leverage a popular major event by suggesting an association with it, thereby achieving its intended marketing objectives – be it to attain exposure, increase brand profile or gain credibility through an implied relationship with the targeted event – and do so for a fraction of the cost of actually sponsoring or being otherwise aligned with the targeted event.

New legislative steps: Major Sporting Events (Indicia and Images) Protection Bill 2014 (Cth)

Recognising the commercial concerns over ambush marketing practices, Australian legislators introduced the Major Sporting Events (Indicia and Images) Protection Bill 2014 (Cth) earlier this year. The Bill, enacted on 27 May 2014, embodies the Australian Government’s desire to provide statutory protection to the organisers and sponsors of major Australian-Pacific sporting events. It will commence on 1 July 2014.
The Act is consistent with previous legislative moves prior to the Sydney 2000 Olympic Games and again at the Melbourne 2006 Commonwealth Games in that it is event specific. It offers protection for three upcoming major sporting events: the Asian Football Confederation (AFC) Asian Cup 2015, the International Cricket Council (ICC) Cricket World Cup 2015; and the Gold Coast 2018 Commonwealth Games. However, unlike previous Commonwealth attempts, the explanatory memorandum of the Bill indicates that there is potential for the scope to be widened to account for future major events.

Under the legislation, use of “protected indicia or images” of a major sporting event for “commercial purposes” is prohibited for non-authorised bodies and persons.

The Act indicates the Commonwealth support for “staging of the events to showcase Australia as a host of world class major sporting events and build trade, tourism and event legacy opportunities” (Major Sporting Events (Indicia And Images) Protection Bill 2014: Outline). Recognising the importance of commercial rights protection as being integral to the success of major sporting events, the Act is an attempt to more thoroughly protect the commercial interests of sponsors, upholding their rights and preventing other entities from unfairly cashing in on associations with major events. The Act also requires the online publication of a Register of authorised entities for each major event by the event-holders, which provides added transparency and openness to the procedure.

Key features of the Act include:

Each listed event having a list of agreed words and phrases.
The Act will exempt the use of certain indicia and images for each event where the use is for the purpose of the provision of information, or the purpose of criticism or review.
The Act provides a range of potential remedies including injunctions, damages, corrective advertisement and the seizure of goods.
It will be based on existing provisions within the Trade Marks Act 1995 (Sections 131-144) that relate to the importation of goods infringing Australian trade marks to avoid confusion for business, consumers and those administering the measures.
The measures in the Act will protect the existing contractual agreements between the relevant for State and Territories and the authorising bodies.
It is proposed that the Act will not include any criminal offence provisions as these can be dealt with through existing legislation such as the Trade Marks Act 1995 and the Copyright Act 1968.

While this Act formally recognises and seeks to curb ambush marketing surrounding major events, it must be noted that this sort of practice always potentially been subject to existing Australian laws. Ambush marketing has had (and continues to have) the potential to fall within the scope of the legal action of passing off (which can arise where a trader’s reputation has been detrimentally affected by a misrepresented association with another trader or brand) and/or breach Section 18 of the Australian Consumer Law (which centres upon consumer protection), as misleading or deceptive conduct and generally under the Trade Marks Act 1995.

Ambush Marketing and the FIFA 2014 World Cup

Later this month, the FIFA 2014 World Cup will take place across twelve host cities in Brazil. With 32 countries participating, there is no doubt that the World Cup forms one of the biggest global sporting events on the calendar, expected to be broadcasted to billions of viewers worldwide. Naturally a sporting event of this scale is extremely attractive to a wide range of businesses as a platform to promote their brand. However, sponsorship is a pricey option and at this level, is simply out of reach of many promoters. Thus, marketing strategies (including various ambush marketing tactics) have come into play for those companies wishing to profit from the popularity and pervasiveness of the World Cup. As established above, this is no new trend.

FIFA are correct in their assertion that the “World Cup” brand is an integral part of their financial success but equally, this should not give the FIFA brand complete control over all football / soccer related activities in 2014. Thus, a market balance needs to be created which recognises the extent of the FIFA brand without limiting the rights of others involved. Naturally this involves a respect for the official FIFA trade marks – which there are many, ranging from “2014 FIFA World Cup Brazil” and “Copa 2014” to “Mundial de Futebol Brasil 2014,” ensuring that they are not used for marketing purposes without the consent of FIFA.

Australian Position

The Major Sporting Events (Indicia and Images) Protection Bill 2014 (Cth) makes no reference to the FIFA 2014 World Cup, instead choosing to offer protections for major events in the Australia-Pacific region. Thus, this will offer no specific protections for FIFA in an Australian context. However, there are existing protections in Australian law which protect FIFA’s commercial rights.
Consumer protection laws

Pursuant to the Australian Consumer Law in Schedule 2 of the Competition and Consumer Act 2010 (Cth), which replaces the Trade Practices Act 1974 (Cth) as well as certain provisions of State and Territory fair trading legislation, any marketing activity that falsely or deceptively suggests or implies an association, sponsorship or affiliation between a brand and an event may constitute misleading or deceptive conduct (section 18) and/or contain false or misleading representations (section 29).
The distinction must however be made between a marketing activity that indirectly implies an affiliation with an event, which may only lead to confusion and may not give rise to a cause of action under the Australian Consumer Law, and a marketing activity that makes direct and misleading claims of association with an event, which may result in deception or a misrepresentation under the Australian Consumer Law.

Additionally, ambush marketing may be actionable under the common law action of passing off if it causes damage to the reputation or goodwill of an official sponsor or supplier to an event or wrongful appropriation in the sense of causing potential customers to associate the product or business of an official sponsor or supplier with that of the marketed brand, where no such connection exists.

Intellectual property laws

Ambush marketing may infringe the intellectual property rights of an official sponsor or supplier to an event, such as the unauthorised use of logos, names, symbols or imagery as part of the overall marketing campaign. For instance, copyright infringement may arise if the marketing activity substantially reproduces original components of the branding of an official sponsor or supplier or of the event itself, for instance its logo, tagline or theme song.

Trade mark infringement may also arise where a marketing activity contains a sign that is substantially identical or deceptively similar to the registered mark of an official sponsor or supplier or of the event itself, if the sign is used as a trade mark to indicate the origin of goods or services that fall within or are similar to the classes of goods or services in which the trade mark of the official sponsor or supplier or of the event itself is registered.

Looking ahead…

Ambush marketing has always been a risky practice, but as specific legislation is introduced to curb its popularity, it is becoming even more risky. While exposure, risk and controversy can sometimes be inherent aspects of a brand’s marketing strategy, the new legal intervention in Australia is likely to cause marketers to rethink their existing approaches to this form of marketing to overcome these new legal challenges. With controversial ambush marketing strategies historically an entertaining feature of major sporting events, we eagerly anticipate what strategies will emerge later this month.