Brands can succeed or fail following a catchy or clever advertising campaign. Increasingly this includes social media in addition to more traditional media such as TV, magazine or newspaper adverts or slogans emblazoned on other promotional material.

All of these attract rights in intellectual property such as trade marks for slogans or copyright in an image.

So, before launching an advertising campaign, brands need to make sure that they either own the rights or the right to use them. Not only is it important to have clear ownership of the rights to stop competitors copying their ideas, but it is also important to make sure that brands do not open themselves up to claims of infringement by third parties for failing to clear rights.

What brands want to avoid

The risks of not doing background checks are increasingly extending to bad press and social comment – earlier this year British Airways flew into the firing line when artist MadC claimed that they had used her artwork for an advertising billboard in Shoreditch without her permission.

BA are not the only ones to suffer. Last year, Porsche were steered into a US court claim in relation to the music it used in a TV advert for its 718 model – rock band, X Ambassadors, accused the car manufacturer of creating a “fake” copy of the song “Jungle” to avoid paying royalties. Another global brand to find themselves in hot water was Starbucks who were accused by artist Maya Hayuk of using her artwork in their Mini Frappuccino campaign.

Does the brand own the rights?

Some rights are easy to protect – for example, trade marks can be registered and, provided you are the registrant and there are no issues such as third parties having pre-dating identical or confusingly similar marks, brands can clearly use a trade name or slogan.

The position can be less clear where the material in question is an image or film or is in sound media. If this is created by an employee in the creative marketing team of a brand, provided it was created in the employee’s work time, the rights in the creative content should be transferred to the brand.

However, it is often the case that brands commission third party consultants to assist with their marketing campaigns. Unless there is an agreement transferring the rights to the brand, the consultant will retain ownership in the content. As a minimum, brands will need a licence to use the content created. Obviously the terms of the licence will be important as they would dictate the scope, territory and duration for which the brand could use the material.

Mitigating risks further

There are further issues to consider.

Brands should make sure that the creator of content gives warranties and representations that it is the author of the content and that it is original and does not copy any third party rights or material. To the extent that any third party rights are involved, the creator should provide that it has obtained all necessary approvals. Brands should ensure that they have an indemnity so that if any of the warranties or representations are found to be false, they can claim back any losses suffered as a result. Such losses may include damages or legal costs of an infringement claim.

In addition, the agreement should detail what happens in the event of a dispute by a third party. Ideally for brands, the marketing consultants responsible would provide all necessary assistance and contribute to the costs of resolving the dispute. In terms of ensuring that brands own the rights and can enforce them against third parties, a further assurance clause which requires the consultants to assist the brand in providing any information or documentation required would be important.

Other advertising risks

There is also the possibility in relation to adverts to get on the wrong side of the Advertising Standards Authority – any factual content must be capable of being verified. This includes online marketing and advertising.

Also, if a brand is planning a comparative advertising campaign, where its products or services are compared to that of another brand, care must be taken to ensure that it complies with a number of conditions, including that the content must not be misleading, it compares goods or services meeting the same need and the comparison is objective.

Loud noises

These days, with the rise of social media, it is easy for artists and creators of material and content to bark loudly when their art or material is being used by brands in their advertising without permission. It is important for brands to maintain their reputation by reducing this risk.

To reduce the risks, brands should:

  1. have suitable agreements with third party marketing consultants to reduce the likelihood of such situations and provide recourse against a third party consultant should the unfortunate happen;
  2. make sure all rights are cleared. Search public trade mark and design right databases to make sure no-one has registered anything identical or similar and register rights before going live with campaigns; and
  3. check the content of the advert to make sure it is correct, verifiable and objective, and then check it again.

The Fox Williams IP team can help with the preparation of suitable agreements to transfer IP rights in content and have experience of undertaking due diligence checks and advising on situations where disputes surrounding IP rights occur.

For further information, please contact a member of our IP team.


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