The Issue of Ambush Marketing: Need for a Specialized Legislation
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The Issue of Ambush Marketing: Need for a Specialized Legislation

Two-time Indian Olympic medallist P.V. Sindhu was in the news recently and not just for her Bronze medal run at the Tokyo Olympic, 2020. After the historic win, some companies used her feat to promote their brand by using her name and image. This practice was later frowned upon by her marketing firm. Baseline Ventures, which represent Sindhu, are considering legal action against brands such as Pan Bahar, P&G among others for putting up such advertisements using her name and image without authorization.

This article comments on the need for a specialized legislation to regulate and curb such unethical advertising practices, since there is no specific relief available to the aggrieved party.

Ambush Marketing- A Revisit

Ambush Marketing is an infringement in disguise. It’s a promotional marketing technique where brands jump the bandwagon of a monumental sports event to promote themselves by using footage from the event. These brands are not official sponsors of the event but they disguise themselves to be one. Consumers are misguided and enable such entities to cash in on the opportunity. All this is done without having to pay for sponsorship or even being remotely associated with the event.

Over the years, brands have been constantly engaging in such ‘malpractice’. In 2018, when Prithvi Shaw became the youngest Indian to score a test century on the debut, Freecharge and Swiggy were served with cease and desist notice by Shaw’s management company regarding ambush marketing.

In July of 2021, the Advertising Standards Council of India (ASCI) said that they will be sending a notice to the captain of the Indian Men’s Cricket team over the social media posts he made praising an educational institution for the Indian athletes participating in the Tokyo Olympics.

Issues

  • Deceiving the Customers

The celebrities/sports personalities are often trusted by the viewers regarding the brands they endorse. This trust exists as these people are well respected in their domains. They are often held at the highest of regards and are idolised and looked up to by millions. Celebrities convert this admiration into monetary form when they associate themselves with a brand name and do advertisements for them. When a brand, rival or competitor to the one promoted by the sportsperson takes on the opportunity and involves itself in ambush marketing, it creates an environment of deception for the consumers.

  • Competition in Bad Faith

We often come across a celebratory advertisement every time there is something great happening in the sports world. Amul is the biggest example of such a practice. But what Amul does is that they add a twist to the event, merging their products with the athletes’ names and presenting it in a doodle. This is done without actually mentioning names or actual pictures. This makes it different from the other advertisements.

Ambush marketing not only hurts the celebrity’s brand value but also causes monetary damage to the celebrity and the brands they promote. Such practice is a competition in bad faith; when a competitor jumps on their moment to milk money and makes an opportunity of their own. For such instances, it will be only fair that the celebrity is being fairly compensated from it.

Advertising policies to curb ambush marketing

  • Rule 40 of the International Olympic Committee (IOC)

The Olympic Charter’s “Rule 40” prohibits athletes participating in the Games from permitting their name, image, or sporting performance to be used in advertising during a “blackout period” (the period right before and during the Games) without the IOC’s approval. The rule exists to protect the sponsors. There is no (or very little) in-stadium branding for Olympic sponsors, and no sponsor logos are allowed on the athletes’ uniforms (save for a small identification for the team’s kit manufacturer). As a result, the value of an Olympic sponsorship is derived mostly from advertising associated with the Games. Because the athletes are the Games’ “face”, being able to associate with Olympians exclusively during the Game time distinguishes sponsors from their competition and adds greatly to their worth.

For the 2020 Olympics, the IOC defined Non-Olympic Partners (at Page 6) as those brands, companies or other organisations which are not Olympic Partners. Under Principle 2(b), Non-Olympic Partners are permitted to use Participant Images for Advertising during the Games Period subject to obtaining any necessary consents from the Participants featured. Such partners must also adhere to other compliances placed by the IOC.

Even under general advertising, such partners must ensure to use the Participant’s image which is in the market for at least ninety (90) days (at page 8) before the Games Period, and which is run consistently and not materially escalated during the Games Period.

  • Advertising Standards Council of India Code (ASCI Code)

ASCI is committed to the cause of self-regulation in advertising and seeks to ensure that advertisements conform to its code for self-regulation, which requires advertisements to be legal, decent, honest, truthful, and not hazardous or harmful while observing fairness in competition.

Two of the Principles (at page 12) of  ASCI’s Self-Regulation Code are:

  1. To ensure the truthfulness and honesty of representations and claims made by advertisements, and to safeguard against misleading advertisements; and
  2. To ensure that advertisements observe fairness in competition so that the consumer’s need to be informed of choices in the marketplace and the canons of generally accepted competitive behaviour in business is both served.

As per the ASCI Code, advertisements shall not, without prior permission, contain any reference to such person which confers an unjustified advantage on the product advertised or tends to bring the person into ridicule or disrepute. Further, advertisements shall neither distort facts nor mislead the consumer through implications or omissions. These principles are there to provide truthful and honest representation to the consumer.

Based on the above two codes, the non-Olympic partners or non-sponsored corporations are wrong for using the image of any athlete without appropriate approvals.

Escaping a Potential Infringement due to absence of law

Canada’s National Hockey League (NHL) et al v. Pepsi-Cola Ltd. is among the most notable cases addressing the ambit of ambush marketing. The licensing body of the NHL, National Hockey Services League (NHSL) entered into a contract with Coca-Cola for the official sponsorship of the event in 1989. Therefore, Coca-Cola had the rights to the NHL symbols for promotional events in the USA and Canada. However, Coca-Cola did not obtain the rights to advertise during the broadcast in Canada during the televised NHL games. Television rights were controlled by NHL and not the NHSL and the same was sold to Molson Breweries of Canada Ltd. in 1988 in a 5-year long contract. Molson Breweries further sold the contract to Coca-Cola’s biggest competitor, Pepsi-Cola. Pepsi released an advertisement campaign on television, without using the NHL symbols but the advertisement was about a hockey contest.

The court said that even though aggressive, the advertisement by Pepsi is not unlawful and the NHL is at fault for not protecting its official sponsor. No infringement of registered trademarks was found. However, this judgement latently favours ambush marketing because as long as trademark and trade name infringement is not there, you can do pretty much anything.

There is not much protection available against ambush marketing in India. In the case of ICC Development International ltd. v. Arvee Enterprises and Anr., Arvee Enterprises was an authorised dealer for sale and service for electronics goods that were manufactured by the second-defendant, Philips India Ltd. They were misrepresenting the association with the plaintiff through advertisements by using slogans. As per the court, since the logo was not used in the said case, the purchasers were not misguided into believing in the association and the application was rejected.

The above cases demonstrate that most of the time, the only redress available to authorised organisers is in circumstances when their intellectual property is infringed which is not directly related to ambush marketing. Therefore, there is a need for specific legislation to safeguard the organizer’s interest.

The Way Forward: Need for a legislation

There is no such legislation in India that protects consumers from ambush marketing. The aggrieved party has some remedy only when ambush marketing is combined with other IP infringement. The aggrieved party can use passing off to demonstrate that the established reputation and goodwill have been squandered. Similarly, under Section 29 of the Trademarks Act, 1999, and Section 51 of the Copyright Act, 1957, the parties could claim trademark and copyright infringement.

In the present scenario, brands and companies put a lot of thought and cunning into their marketing strategies before engaging in ambush marketing. As a result, the majority of ambush marketing can be carried out while remaining within the bounds of Indian law. It is critical to address ambush marketing by enacting new legislation with the entities adopting innovative digital ways to indulge in unethical ambush marketing. New legislation is crucial as it is difficult for a plaintiff to claim speedy remedies when there is a regulatory void on the issue.

 

Prateek Singh is a student at Institute of Law, Nirma University, Ahmedabad, Gujarat.

 

Rajat Chawda is a student at Institute of Law, Nirma University, Ahmedabad, Gujarat.

 

Suggested citation: Prateek Singh and Rajat Chawda, The Issue of Ambush Marketing: Need for a Specialized Legislation, JURIST – Student Commentary, October 7, 2021, https://www.jurist.org/commentary/2021/10/singh-chawda-ambush-marketing/.


This article was prepared for publication by Sambhav Sharma, a JURIST Staff Editor. Please direct any questions or comments to him at commentary@jurist.org

Opinions expressed in JURIST Commentary are the sole responsibility of the author and do not necessarily reflect the views of JURIST's editors, staff, donors or the University of Pittsburgh.