Commercial Law International

By: Ainsley Brown

So what is brand management law?

The best definition that I can give is the law or legal practice that facilitates a company or companies managing their band or brands. Yes, I know, I know the definition is a bit circular but hey what do you expect, I am a lawyer after all.

Then what is brand management?

Brand management according to BusinessDictionary.com is: the process of maintaining, improving, and upholding a brand so that the name is associated with positive results…Brand management is built on a marketing foundation, but focuses directly on the brand and how that brand can remain favorable to customers.

Brand management law (BML) is thus defined as the legal facilitation of the above process. It is a multi-disciplinary practice area and brings together many differing areas of law (Intellectual property (IP), litigation, contracts, tax, etc) but more importantly by its very nature also encompasses the non-legal (marketing, public relations, consumer care, business sensibility/sensitivity, etc).

BML is not just a simple matter of commercial awareness or knowing your clients business – both of which are important very important aspects of this area of law, however BML goes beyond either of them. That is to say it is not just a matter of discerning what the client’s interests are, then moving to put in place the requisite legal instruments that establish some right “to” or “in” and then defending said right or rights. Take for example a client that has expended millions on research and development, this client clearly has an interest in seeing a return on this expenditure, a lawyer would move to protect the client’s work product by intellectual propertizing it as much as possible (e.g. registering patents and trademarks), the lawyer would then act as a kind of sentinel, safeguarding the client’s IP through the threat (real or potential) of legal action.

BML is this but much more. Its is practice area that requires a lawyer to be able to keep the legal and non-legal in sync – always remembering that it is the brand that matters.

This practice area requires from a lawyer certain degree of intellectual flexibility. From the nature of our profession lawyers are problem solvers – some might beg to differ – to be more specific we are legal problem solvers. To put it succinctly we will find the legal solution to your business problem. And here lays the problem for many a lawyer when it comes to BML.

Lawyers are good at finding legal solutions to business problems; well that’s what we were trained to do after all. However, BML requires a lawyer to go beyond this and to realize that some times what is in fact needed is a business solution to a legal problem.

What is the difference between these two approaches, isn’t it just matter of semantics? Well, you will just have to stay tuned.

By: Omar Ha- Redeye and posted on Slaw on March 23, 2010. 

Luxury good maker Louis Vuitton Moet Hennessy (LVMH), who produces Moet & Chandon champagne and Dior perfume, claimed that Google’s advertising polices violated their trademark.  The practice in question was the use of key words related to brand names by counterfeiters, who would then link to online stores.

Based on reported coverage of the case, the European Court of Justice made several main findings in a decision released this morning:

1. Google has not infringed copyright simply for allowing companies to purchase trade mark key words
2. Google cannot be liable for advertising requests if it removes them when informed that a trade mark has been abused
3. Trade mark owners have the right to stop their use in AdWords when they suggest they are linked to the owner or create confusion about the owner
4. Companies can still claim compensation if a court rules that the misuse of trade mark damages the brand
5. Google will be liable for infringement if it does not act quickly to stop the misuse of trade mark

Both sides are claiming victory.

A copy of the decision can be found here, and a summary of the case by the court here.  Google’s blog post in response to the case can be found here, and a press release by LVMH can be found here.

By: Ainsley Brown

When it comes to the hype around a new product no body does it better than Apple. In fact you could even say that Apple has made the hype surrounding a new product a large part of its advertising and marketing campaign.

However, the key to such marketing is maintaining such levels of secrecy that would make the CIA proud. This same approach was taken with all its “i” products – the iPod, the iPhone and now the iPad. With the importance of secrecy such high levels of secrecy it’s only a matter of time before the lawyers get involved.

And yes, they did get involved.

In the lead up the release of the iPad this week, Apple’s lawyers Orrick, Herrington & Sutcliffe LLP sent out a stern warning letter to a website that offered a cash bounty to any one that could produce pictures of the then unnamed iPad. The Silicon Valley gossip website, Valleywag received the warning after it offered $10,000 for a photo, $20,000 for a video and $50,000 for a video with Apple co-founder/CEO Steve Jobs holding the iPad.

Now if this was simply a joke by Valleywag, and I don’t know if it was or wasn’t, Apple and their lawyers certainly weren’t laughing. In the letter to Valleywag, Orrick, Herrington & Sutcliffe warned: “While Apple values and appreciate vibrant public commentary about its products, we believe you and your company crossed the line by offering a bounty for the theft of Apple’s trade secrets. Such an offer is illegal and Apple insists that you immediately discontinue the Scavenger Hunt.”

There is no word of if Valleywag was moved by the warning but it is important to note that the iPad was released without incident to the joy of Apple.

By: Ainsley Brown

“Old pirates, yes they rob I.”

The opening words to Redemption Song are as hard hitting now as they were when first bellowed by the iconic musical legend – Bob Marley - years ago. These words however may be taking on a new meaning in this era digitization and globalization where information is king. This era is all about IP – Intellectual Property – and the right to access, control and exploit for ones own benefit the concepts encapsulated within creativity.

As a matter of course the Brand – how you package and sell your IP, in fact branding itself becomes a form of IP – in this era becomes of great import. In fact one could argue that brand is not the everything but is the only thing. Consumers no longer simply buy a product or service – no, no – rather they are buying a brand.

Now this brings me to the House of Marley. The heirs of Bob Marley – the holders of the exclusive rights to the reggae superstar’s image – are drawing clear battle lines in the IP war on whom can access, control and exploit Marley’s iconic status. They have enlisted the aid of Canadian private equity firm Hilco Consumer Capital to package, manage, market, sell, monitor and protect the IP that is Bob Marley through the products sold under the new House of Marley brand.

Rather than attack the hawkers of existing wears, which would result in a multiplicity of protracted legal battles spread-out across the globe, Hilco and the House of Marley have instead embarked on a branding campaign. It is quite simple, the House of Marley will be authentic and all other comers will only be imitators – a potentially very lucrative strategy, if it can be pulled off.

According to reports, the Marley brand – name, sound and image – are estimated to generate $USD 600 million in a year and this is on the bootleg side alone. On the legal side, the brand generates a profitable but substantially smaller $USD 4 million a year.

With numbers like those no wonder the Marley heirs sought out and gained a partner like Hilco with a proven reputation in IP generally and branding specifically?

While I applauded this new venture, I can’t help but how long will it be before we see a court case or two? Maybe a few Anton Piller orders – best described but somewhat inaccurately as a civil search warrant, that feature so prominently in IP cases – or maybe the odd Mareva injunction – a court order freezing assets -?

The reason why I am thinking this is that it is impossible to escape the fact that branding – intellectual propertization – eventually means not only the allocation of exclusive rights but also the enforcement of those rights.

By: Ainsley Brown

Imagine being told that you could no long buy a BlackBerry or being told that the services of the one you already own will be restricted, just imagine. Think it can’t happen; well think again for this has now entered the range of possibility in the United States.

The Canadian company, Research In Motion Ltd (RIM), the maker of the ubiquitous BlackBerry, could be banned in the US if it receives and adverse ruling by the International Trade Commission (ITC). Please, please don’t panic, your BlackBerry is still safe, please note I said “if”.

Let me be perfectly clear here, it is only a slim possibility, for now, as the ITC has to date not initiated an investigation of RIM. However, there has been a complaint made to the ITC by Prism Technologies LLC (Prism) that RIM has infringed its intellectual property.

The complaint made by made by Prism is its latest move to force a settlement from RIM. The two are embroiled in hotly contested patent case since last year in federal court in Nebraska were Prism claims that RIM through its BlackBerry has violated its patents held on desktop software and servers and an authentication system. In September of this year Microsoft settled its portion of the case with Prism.

In filing the ITC complaint what Prism is in effect trying to do is force RIM to settle the patent infringement case. But how, you might ask.

Well there are two reason and all of them having to do with the characteristics of the ITC. The ITC is a quasi-judicial federal agency set up to investigate and enforce US laws as they pertain to unfair trade practices. The agencies mandate extends from anti-dumping and countervailing duties to patent infringement.

The first of the two reasons is that the ITC unlike in a lawsuit, which could drag on for year, can complete its investigation in about 15 months. If an investigation is actually launched, RIM and its lawyers will have to weigh on the one hand the probability of an adverse finding with the finding surviving the subsequent appeals that are sure to come and on the other hand settling its issues with Prism so that any ITC investigation would be rendered a moot point. The speed with which the ITC can move will defiantly put RIM a weakened negotiating position – well played Prism lawyers, well played.

The second reason is that the ITC unlike courts do not have the authority to order royalties but they do have the power to stop any importation of any new devices; prohibit the sale of devices already imported; and even bar the transmission signals originating from another country. Here again Rim and its lawyers will have to do some business-legal analysis and determine what’s in its best interest – is it better to settle now ( with only an ITC complaint) or is it better to wait and let a potential ITC investigation or even adverse finding force its hand?

The good news for RIM is that it still has time, for now there is only an ITC complaint, no investigation.

By: Ainsley Brown

EBay was fined yesterday €1.7 million by the Paris Commercial for violating an injunction prohibiting the sale of LVMH products on the online auction site.

The injunction was imposed on eBay last year after it was taking to court by LVMH for allowing the sale of its products on its site. LVMH, the world’s largest luxury good group, with such brands as Louis Vuitton, Christian Dior, Moet Hennessy, and Givenchy, to name a few, had  exclusive sales and marketing contacts with specialist retailers.  In an effort to protect its brands, including of course its exclusive sales arrangements LVMH – and other luxury band companies such as L’Oreal – has taken aggressive steps against eBay and others.

These legal battles are not just simply about LVMH or L’Oreal wanting to prevent counterfeits of their brand entering the market, though this is part of the story. No! It is also, if not more about brand management – who has the right to develop, market, sell and ultimately who right to profit from such efforts.  All of this, it must not be forgotten, is being done in the context of the era of globalization and the internet.

By: Ainsley Brown

A 47 year old former engineer from the Ford Motor Company has been charged with stealing some of the company’s trade secrets.

The engineer, a one Xiang Dong Yu, also known as Mike Yu, was charged last week after traveling from China to the US. Mr. Yu is accused of unauthorized computer access; theft, and attempted theft of trade secrets.

But what exactly is he accused of steeling?

It is alleged that he copied thousands of electronic documents containing designs for power systems, mirrors, doors, steering wheel assembles, wipers and other vehicle components. Authorities, say that much of what Mr. Yu is accused of doing occurred in December 2006, just before he quit to take up a post with a Chinese competitor.

If found guilty Mr. Yu could face a maximum sentence of 10 years in person.

By: Ainsley Brown

Anheuser-Busch, along with Labatt Brewing Co – both companies are owned by Anheuser-Busch Inbev NV – have filed suit against Brick Brewing Co claiming that Brick is violating its intellectual property.

The dispute centers on the use of the colour green and limes on the labels of Brick’s Red Baron Lime Beer.  Anheuser, the maker of Budweiser, is alleging the Waterloo, Ontario, Brick has violated the intellectual property on its own lime beer – Bud Light Lime. The suit will be essentially an exercise in  compare and contrast; like one of those games where you are given two similar images and you have to find and circle the differences.

The primary question that that has to be answered during this is whether or not any similarities between the two beer is likely to lead to confusion in the eyes of the public? Put another way is there enough of a difference between the two beers so that the consumer may make a conscious decision to chose one brand over the other?

So, how similar/different are they?

Both are sold in clear glass bottles; both labels have green and silver colours; both depict a slice of lime; Bud Light lime has BL written on it; and Red Baron Lime has its name spelt in different font than that of BL. I invite one and all go out to your nearest Beer Store or LCBO and you be the judge, alternatively you can do the same by visiting both websites.

Is this really the crux of the dispute or is there something else afoot?

I believe there is. I think the real issue here is the 25% cost differential in Ontario between the two beers. Does Anheuser – seeking to prevent Brick from using limes and beautiful scantily clad people in its advertising; unspecified monetary damages; along with $500, 000 in punitive damages – have a valid claim? I don’t know but what do know is that Red Baron Lime being 25% cheaper than Bud Light Lime in these tough economic times will be sufficient inducement to many a beer drinker to at least give it a try. That being the case Red Baron Lime could represent a substantial threat to Bud Light Lime, well at least in Ontario.

On a side note, this is not the first time that these two have tangled. In June of this year the two settled an intellectual property dispute after Labatt claimed that Brick’s Red Baron packaging was too similar to Labatt’s Brava beer. The dispute was settled after Brick agreed to change its label.

However, this time there does not seem to be any room  for such a settlement, the vitriol coming from Brick is to be believed.

By: Ainsley Brown

The Swiss pharmaceutical giant Novartis has launched suit in the English High Court against Glaxo Smith Kline (GSK) claiming that GSK has violated its intellectual property.

This new action is far from being the opening salvos of this drug war; the two have already locked horns over the same matter. GSK last year sued Novartis in both England and Belgium – the outcomes of which are yet to be decided – in an attempt to get Novartis’ patent revoked. Now interestingly enough Novartis rather than launching a counter claim has chose to bring a fresh action before the English courts.

All a bit confusing isn’t it? Don’t worry, I was confused at first myself – let me break it down for you.

This saga is more than just about patent protection or even brand protection, both of which are of great importance in and of themselves. No! This is about much more. This story goes far beyond that to include commercial awareness; business strategy; profitability; and continued sustainability.

No my friends this is no exaggeration. What this story is reveals is the growing importance of vaccines to big pharma. Yes, vaccines.

Vaccines have become the new life blood for the drug giants as they have increasingly moved away from blockbuster big name magic pills to a more diversified portfolio. This diversification has included a soften stance on generic drugs – going as far as either doing it themselves or entering into joint ventures with smaller specialist generic makers – and consumer goods. However, the cornerstone of the diversification has been a move back into the steady income generation of vaccines with investments being made in new and old diseases alike.

At the heart of this battle are a set of vaccines used to prevent childhood diseases such as meningitis. More specifically, the techniques used in making these said vaccines. According to GSK it registered its patents covering such techniques as far back as 1981 and therefore beats the Novartis patent by being the first to register. As aforementioned, GSK launched suit in both England and Belgium in an attempt to get what it claims as Novartis’ weak patent revoked. In response Novartis launched suit against two GSK subsidiaries – Smithkline Beecham and GSK Biologicals – claiming that not only is its patent firmly placed but that GSK was the one infringing on its intellectual property.

It will definitely be interesting to watch this clash between these two Titians unfold.

By: Ainsley Brown

First France, now the UK. The L´Oreal v eBay counterfeiting war goes on with yet another victory for eBay, this time in the English High Court.

In L´Oreal Takes eBay To Court I mused: While I will admit that I do not have the full particulars of the case, I just have a feeling that L’Orèal is going to win this one. But eh you never know… There is just no such thing as: a sure thing in litigation. I could not have been more wrong, well in part. I guess it’s a good thing I did the lawyerly thing by first admitting that I did not know the particulars of the case and secondly leaving open the possibility that pronouncement (read: lawyer´s educated guess, though we rare admit this point) could indeed be incorrect.

At the end of the day it would seem that eBay´s argument that it is merely a trading platform and is in no way directly involved in the sale of the goods, won the day over L´Oreal´s counterfeiting and consumer danger one. However (hey its law, there almost always is an however), if this is all you read from this judgment, you have missed two very important inter-related points.

The first is that while Judge Richard Archer did rule that eBay cannot be held responsible for its users´ actions, he did agree with L´Oreal that eBay could do more to prevent the sale of counterfeit goods. The judge went as far as suggesting, that is suggested not ordered, ten measures that eBay could take to beef up its anti-counterfeiting measures. These include requiring sellers to disclose their name and addresses in all listings and filtering auction lots before they are put on the site.

The second point, which flows from the first, is that any new anti-counterfeiting measures implemented by eBay would require a degree of co-operation from L´Oreal and other brands to be of any success. Just look at the measures suggested by the judge to see my point. This seems to be a consentient theme with these cases, as in their French skirmish, the French judge suggested this very thing.

The question now is, will L´Oreal and eBay kiss and make up or will they continues their war fought out in battles in courts all over the world?

This does not seem like a promising prospect any time soon, no matter how much the legal and better yet commercial sense it makes. Evidence: legal proceedings continue in both Spain and Germany.