Feature

Viva Brazil: Protecting the Propriedade Industrial of Rights Holders at the 2016 Rio Olympic Games

Len Glickman, Stephen J. Henderson, and Sophie H. Moher

©2016. Published in Landslide, Vol. 8, No. 6, July/August 2016, by the American Bar Association. Reproduced with permission. All rights reserved. This information or any portion thereof may not be copied or disseminated in any form or by any means or stored in an electronic database or retrieval system without the express written consent of the American Bar Association or the copyright holder.

Hosting the 2016 Summer Olympics will be a major undertaking for Rio de Janeiro, Brazil. Brazil has the advantage of having hosted the 2014 FIFA World Cup—an event comparable to the Olympics in size and global stature. The World Cup shone a spotlight on Brazil’s policies and legal framework around intellectual property protection, and the Olympics will pose yet another challenge to Brazil’s intellectual property regime. Brazil has implemented event-specific legislation for the Olympic Games, but only time will tell whether these protections are sufficient to address the trademark infringements and ambush marketing that will undoubtedly occur. Ambush marketing is a strategy used in advertising to lead consumers to believe that a company is an official sponsor of an event—in this case, the Olympics—when in reality the company is acting deceitfully and is not a sponsor.1

The International Olympic Committee (IOC) identifies the Olympic Games as “one of the most effective international marketing platforms in the world.”2 The infrastructure budget for Rio 2016 is 24.1 billion Brazilian reais (approximately US$10.76 billion). With an event of this size and capacity reaching billions of people in over 200 countries, Brazil has the daunting task of making sure its intellectual property regime allows for proper enforcement by IOC sponsors, the IOC itself, and the local organizing committee. This will involve close surveillance of merchants for counterfeit Olympic products, increased border control, education about the disadvantages of buying and selling counterfeit products, and continued adoption of effective methods to target ambush marketers. To adequately enforce intellectual property protections, Brazil must take an interdisciplinary approach that includes law enforcement, security, education, and an efficient legal framework.

Olympic Marks

There is a general need to protect Olympic marks and sponsors from ambush marketers, who do not pay sponsorship fees but associate themselves with Olympic events nonetheless. With the proliferation of online marketing and social media use, protecting Olympic marks has become an increasingly complex task. As evidenced in the 2014 FIFA World Cup, the unofficial use of marks can take away from the integrity of the event and change how the global community views the event and its organizers.3 This summer, Rio and all of Brazil will be “on trial,” as we watch to see how well Brazilian officials can protect Olympic sponsors and enforce Brazilian intellectual property laws.4

Brazil’s Legal Framework

Prior to being awarded the 2016 Rio Olympic Games and the 2014 FIFA World Cup, Brazil’s traditional legal framework regarding intellectual property did not specifically protect official sponsors against ambush marketers. Many previous infringement concerns related to the unauthorized production and sale of counterfeit versions of the yellow jerseys of the Brazilian national soccer team—perhaps the most famous shirt in the world. The Brazilian Industrial Property Law,5 the Copyright Law,6 unfair competition laws, and the Civil Code7 provided some applicable protections to intellectual property owners, but the creation of specific legislation protecting Olympic marks and sponsors was necessary.

In anticipation of the 2014 FIFA World Cup, Brazil passed the Brazilian General Law of the World Cup (World Cup Law)8 in June 2012, which specifically addressed ambush marketing. The legislation protected trademarks, images, and sounds related to FIFA, in recognition of the special protections necessary for the 2014 FIFA World Cup.9 FIFA had control over promotional activities and commerce surrounding FIFA events and on main access roads. This included food and beverage sales, distribution of advertising and promotional materials, and the use of balloons, aircraft, and watercraft for marketing purposes. The World Cup Law prohibited ambush marketing “by association” (where the ambush marketer confuses the public into believing its brand is associated with the event) and “by intrusion” (where the ambush marketer displays its brand on billboards near event venues). Sanctions for violations under the World Cup Law included fines and imprisonment.10

Ambush Marketing

There are many types of ambush marketing, including a company buying advertising time leading up to the Olympic Games in the hope of consumers creating an association between the brand and the event, giving away tickets to Olympic events through marketing campaigns or events, or advertising near Olympic sites and events.11 Another example of ambush marketing is a company holding a press conference, at which Olympic athletes speak, where the ambush marketer company’s logo is present and visible to consumers and viewers.12

With respect to the 2016 Olympic Games, some companies cannot afford to or do not wish to be official Olympic sponsors. Through ambush marketing, these companies will associate themselves with the event on an unauthorized basis. The benefits to the ambush marketer of avoiding the sponsorship fee are often at the expense of the official sponsor, its brand, and its image.13

“Direct” ambush marketing describes a company’s improper use of Olympic trademarks or logos that falsely represent the company’s official association with the Olympic Games.14 Brazil’s passing of legislation protecting Olympic intellectual property will help to combat these direct infringements. “Indirect” ambush marketing is often more difficult to combat, because some companies develop very creative, innovative ways to create associations and take advantage of visitors and consumers without any obvious misrepresentations or infringements of protected marks or products.15

Previous Examples of Ambush Marketing at Major Sporting Events

Beats by Dre Headphones

Neymar, the famous Brazilian soccer player, starred in a YouTube clip called “The Game before the Game” by headphone maker Beats by Dre. The five-minute clip filmed famous soccer players listening to music on Beats by Dre headphones in preparation for the 2014 World Cup. Despite not being an official sponsor, Beats by Dre generated significant publicity as the clip received more than 30 million views on YouTube.16

To combat this media exposure, Sony, an official sponsor and Beats by Dre competitor, sent all World Cup participants a free set of headphones. Further, FIFA banned Beats by Dre headphone usage at the World Cup. Much to Sony’s dismay, some players held on to their Beats by Dre headphones. When the German team won the World Cup, Beats by Dre congratulated them with a pair of gold headphones each.17

Paddy Power

Online gambling company Paddy Power famously engaged in ambush marketing during the 2012 London Olympics. The company advertised on billboards that it was the “Official Sponsor of the Largest Athletics Event in London This Year.” The advertisements referred to an egg and spoon race in London, France, rather than London, England.

While Brazil has enacted laws and policies to enforce anti–ambush marketing legislation and regulations, it is evident that the myriad of ways a company can influence consumers makes controlling such tactics extremely difficult.18 For the 2012 Olympic Games in London, the United Kingdom enacted special event legislation that strictly prohibited false suggestions of a company’s association with the Olympic Games. The test for determining whether a violation had taken place included use of terms such as “Games,” “2012,” “London,” and “Sponsors” combined together.19 It was not the generic use of these words that amounted to infringement, but rather the combination of them.20

Bavaria Beer

During the 2010 FIFA World Cup in South Africa, 36 young women were hired by Bavaria, the second largest Dutch beer company after Heineken, to sit together wearing bright orange—the official Dutch color—for the Holland versus Denmark match. The outfits these young women wore had allegedly been used in a promotional event for Bavaria in the past, and the activity violated South Africa’s Merchandise Marks Act.21 The young women were ejected from the match, and two were arrested. Despite these negative consequences, the ensuing global media coverage likely benefited Bavaria’s brand.

Pepsi in China

An example of ambushing official sponsors without infringing any established laws was Pepsi’s use of red cans instead of its typical blue ones during the 2008 Beijing Olympic Games. Pepsi’s reasoning for doing so was to demonstrate the company’s respect for the “year of China”—a motive difficult to counter.

Regimes to Protect Intellectual Property at Previous Olympic Games/International Sporting Events

Recent Olympic Games: Vancouver, London, and Sochi

The last three Olympic Games have all seen host countries pass legislation to protect Olympic marks.

Prior to the 2010 Vancouver Olympic Games, Canada passed the Olympic and Paralympic Marks Act, which provided protection for Olympic marks and included anti–ambush marketing provisions primarily for the benefit of official Olympic sponsors.22

While the United Kingdom had trademark legislation to protect Olympic marks well before London was the host city of the 2012 Olympic Games—the Olympic Symbol etc. (Protection) Act—it was amended to expand its scope prior to the 2012 Olympics.23 The amended statute prevented unauthorized individuals from suggesting to the public an association with the London Olympic Games by means of their goods, services, or activity.24

Federal Law No. 310, the Olympic Law passed by the Russian government, granted IOC officials and the organizing committee for the 2014 Sochi Olympic Games exclusive rights over protected Olympic marks.25 The legislation also provided a list of and usage procedures for Olympic and Paralympic marks.26

2014 FIFA World Cup in Brazil

The World Cup Law,27 passed in 2012, was similar in kind to pieces of legislation adopted by other World Cup hosts in the past. The purpose of the World Cup Law was to target ambush marketers, control advertising in and around official FIFA World Cup venues, and crack down on piracy online.

The World Cup Law protected the rights of intellectual property owners and went much further than any Brazilian law had in the past—including the Pelé Law discussed below—in protecting rights owners’ interests. Under this piece of legislation, only the official broadcaster could capture and broadcast event images. Noncommercial use was permitted but limited to 3 percent of a match, or 30 seconds of a ceremony.28

To protect the event’s trademarks, the World Cup Law did not allow unauthorized association with World Cup marks, and created expedited infringement proceedings during the World Cup.29

Notably, under the World Cup Law, ambush marketing became a criminal offense. Under the statute, FIFA was able to expedite trademark applications to the Brazilian National Institute for Industrial Property (Instituto Nacional da Propriedade Industrial), so long as the trademarks related to the World Cup. To make companies aware of the law, third-party infringers around Brazil were sent cease and desist letters. This implementation was controversial, in part because hundreds of marks were registered without descriptions or distinctiveness, yet regarded with importance because of their connection to the World Cup.30

Under the World Cup Law, the “clean stadium policy” only permitted publicity related to official sponsors. Television advertising slots before, during, and immediately following matches were saved for official FIFA sponsors, and if these sponsors did not wish to advertise, the televisions networks could sell the space to noncompetitors only.31 FIFA was afforded this control over ambush marketers under the World Cup Law.

The legal provisions in place for the 2014 FIFA World Cup were very helpful before, during, and after the event. Brazilian officials were able to enforce these provisions against both Brazilian and foreign ambush marketers.

Brazilian Efforts Ahead of the 2016 Rio Olympics

With respect to customs control and anticounterfeiting, the Brazilian Customs and Federal Police have invested in anticounterfeiting programs and training. Brazil has also created the National Directory to Combat Trademark Counterfeiting, which contains information about trademark owners that can be used by government agents engaged in fighting trademark infringement.32

The official website of the 2016 Rio Olympics features information about Olympic marks, including specific guides for marketers and the tourism, hotel, and leisure sectors.33 By providing this information, the Rio 2016 Olympic and Paralympic Games Organising Committee (Rio 2016 Committee) can communicate the value of the Olympic marks while providing examples of how the Games can be referenced factually without improperly implying a promotional connection.

Brazil has also created a legal framework for the 2016 Olympics that builds on the experiences of authorities during the 2014 FIFA World Cup.

The Sports Law

The Sports Law, also known as the Pelé Law, guarantees the protection of Olympic signs and symbols.34 In response to a dispute between media organizations and the organizers of the 2007 Pan American Games, the Pelé Law established media organizations’ rights to access venues and capture and use images. During the 2014 FIFA World Cup, the World Cup Law governed the access to and use of World Cup images.35 However, the Brazilian Olympic Act (as discussed below) is silent in terms of broadcasting rights despite regulating intellectual property surrounding the 2016 Olympic Games.36

The Pelé Law complements the trademark protections outlined under the Brazilian Industrial Property Law, which prohibits unauthorized registration of reproduced, imitated, or authentic names and symbols of official sporting events such as the Olympic Games.37 Under the Pelé Law, Brazil protects the names and symbols of certain sports administration entities even if they have not yet been formally registered.38

Nairobi Treaty

The Nairobi Treaty, of which Brazil is a signatory, refers solely to the protection of Olympic symbols.39 The Nairobi Treaty existed before Rio was awarded the 2016 Olympic Games; it was ratified by decree.40

Federal Olympic Act

The Olympic Act (Lei do Ato Olímpico) was passed in 2009 to protect Olympic symbols, mascots, flags, and trademarks.41 The legislation grants the Rio 2016 Committee, the IOC, and official sponsors exclusive rights to Olympic and Paralympic marks. Unauthorized third parties are prohibited from using any of the symbols on the protected list, unless such parties have obtained express prior approval from the Rio 2016 Committee or the IOC. Despite these protections, the legislation does not prohibit indirect ambush marketing. The structure of the Olympic Act is quite different from the World Cup Law. Most significantly, criminal provisions are not included in the federal Olympic Act as they were in the World Cup Law.42 This legislation resembles the Canadian Olympic and Paralympic Marks Act, discussed above, which essentially created a Canadian legal framework specific to Olympic trademarks.43 Unlike the Canadian Act, the Brazilian Olympic Act does not directly restrict ambush marketers from trying to benefit from an affiliation with the Olympic Games in an unofficial capacity.44

Other Regional and Municipal Laws

Similar to other host cities, the state of Rio de Janeiro and other municipalities and states where Olympic events are taking place have passed relevant pieces of legislation. These laws include:

  • The Rio de Janeiro State Olympic Act;45
  • The Rio de Janeiro Municipal Olympic Act—Municipal Decree 30, 379/2009;46
  • The Minas Gerais Olympic Act;47
  • The Belo Horizonte Olympic Act;48
  • The Bahia Olympic Act;49
  • The Salvador Olympic Act;50
  • The São Paulo State Olympic Act;51 and
  • The São Paulo Municipal Olympic Act.52
  • The purpose of these regional and municipal laws is to protect intellectual property and signage associated with the Rio Olympics.

Looking Forward

It is clear from past experience that counterfeiters and ambush marketers will attempt to utilize the 2016 Rio Olympic Games to their benefit despite not having the right to do so. Even so, Olympic sponsors and other rights holders can take some comfort that the Brazilian government is not sitting on the sidelines. Rather, the government has taken active steps to pass new legislation to deal with intellectual property theft during the Olympics. The adoption of new enforcement tools to assist in combating counterfeiting and the experience of recently hosting the World Cup (and the institutional knowledge it developed) should enable Brazilian authorities to better deal with intellectual property issues as they arise. Olympic sponsors and rights holders should stay engaged with their Rio 2016 Committee contacts and keep their in-house legal department and outside counsel up to date on their efforts and any intellectual property infringements of which they become aware.

After this summer’s Olympic Games in Rio, the 2018 Winter Olympic Games will be held in PyeongChang, South Korea. Interestingly, while the Report of the IOC 2018 Evaluation Commission praised the legislative regimes of both Germany and France—Munich and Annecy were bidding alongside PyeongChang—as “provid[ing] significant protection of Olympic intellectual property rights,”53 it did not describe Korean legislation as providing significant protection. Rather, the report noted: “The ‘Special Act’ to be passed should PyeongChang be elected would include provisions to further enhance the ability to protect intellectual property rights.”54 This act, the Special Act on Support for the PyeongChang 2018 Olympic and Paralympic Winter Games, was passed at the end of 2011.55 Nevertheless, it has been said that the Special Act is not sufficient to prevent ambush marketing and so additional laws will be needed.56 Hopefully, Korean authorities will reflect on the experiences of Brazil in hosting the Olympics and ensure that rights holders are protected at the 2018 Olympic Games in PyeongChang.

Endnotes

1. Carlos E. Bacalao-Fleury, Brazil’s Olympic Trials: An Overview of the Intellectual Property Challenges Posed by the 2016 Rio de Janeiro Games, 2011 U. Ill. J.L. Tech. & Pol’y 191, 197.

2. Id. at 192 & n.9.

3. Ambush Marketing: Lessons from the World Cup, World Intell. Prop. Rev. (Sept. 22, 2014), http://www.worldipreview.com/article/ambush-marketing-lessons-from-the-world-cup.

4. Sion Clwyd Roberts, How Will Brazil Tackle the World Cup Ambush Marketers?, Guardian (June 11, 2014), http://www.theguardian.com/media-network/media-network-blog/2014/jun/11/world-cup-football-brazil-ambush-marketers.

5. Lei No. 9.279, de 14 de Maio de 1996, Diário Oficial da União [D.O.U.] de 15.5.1996 (Braz.).

6. Lei No. 9.610, de 19 de Fevereiro de 1998, Diário Oficial da União [D.O.U.] de 20.2.1998 (Braz.).

7. Código Civil [C.C.] [Civil Code] (Braz.); Lei No. 10.406, de 10 de Janeiro de 2002, Diário Oficial da União [D.O.U.] de 11.1.2002 (Braz.).

8. Lei No. 12.663, de 5 de Junho de 2012, Diário Oficial da União [D.O.U.] de 6.6.2002 (Braz.).

9. Dickerson M. Downing, Rodrigo Azevedo & Mary R. Bram, Ambush Marketing: Coming Soon to a Stadium Near You, Ass’n of Corp. Couns., (Jan. 22, 2013), http://www.acc.com/legalresources/quickcounsel/amcstasny.cfm.

10. Id.

11. Bacalao-Fleury, supra note 1, at 197 & n.53.

12. Id. at 210 & n.158.

13. Downing, Azevedo & Bram, supra note 9.

14. Id.

15. Id.

16. Beats by Dre, The Game before the Game: Film Presented by Beats by Dre, YouTube (June 5, 2014), https://www.youtube.com/watch?v=v_i3Lcjli84.

17. Ambush Marketing, supra note 3.

18. Downing, Azevedo & Bram, supra note 9.

19. Id.

20. Ambush Marketing, supra note 3.

21. See Merchandise Marks Act 17 of 1941 §§ 15, 15A (S. Afr.); Second 2010 FIFA World Cup South Africa Special Measures Act 12 of 2006; General Notice 683 in GG28877 of 25 May 2006 (S. Afr.).

22. Olympic and Paralympic Marks Act, S.C. 2007, c. 25 (Can.).

23. Olympic Symbol etc. (Protection) Act, 1995, c. 32 (U.K.).

24. Leonard Glickman & Evan Eliason, Brand Protection, Trademarks, and the Event That Shall Not Be Named: Event-Specific Legislation and the Olympic Games—Part 3 of 3, LawInSport (Sept. 9, 2013), http://www.lawinsport.com/articles/intellectual-property-law/item/brand-protection-trademarks-and-the-event-that-shall-not-be-named-event-specific-legislation-and-the-olympic-games.

25. Federal’nyi Zakon RF ob Organizatsii i o Provedenii XXII Olimpiyskikh Zimnikh Igr i XI Paralimpiyskikh Zimnikh Igr 2014 Goda v Gorode Sochi [Federal Law of the Russian Federation about the Organization and about Carrying Out the XXII Olympic Winter Games and the XI Paralympic Winter Games of 2014 in the City of Sochi] No. 310-FZ, Sobranie Zakonodatel’stva Rossiiskoi Federatsii [SZ RF] [Russian Federation Collection of Legislation] 2007, No. 49, Item 6071.

26. Glickman & Eliason, supra note 24.

27. See supra note 8.

28. Rafael Ferraz Vazquez, Sport and Broadcasting Rights: Adding Value, WIPO Mag. (Apr. 2013), http://www.wipo.int/wipo_magazine/en/2013/02/article_0005.html.

29. Id.

30. Ambush Marketing, supra note 3.

31. Id.

32. Pedro Tavares, BRAZIL Creation of a “National Directory to Combat Trademark Counterfeiting, 69 INTA Bull., no. 1, Jan. 1, 2014, http://www.inta.org/INTABulletin/Pages/BRAZILCreationofaNationalDirectorytoCombatTrademarkCounterfeiting%E2%80%9D.aspx.

33. Branding: Use Rights, Rio 2016, https://www.rio2016.com/en/brand (last visited May 9, 2016).

34. Lei No. 9.615, de 24 de Março de 1998, Diário Oficial da União [D.O.U.] de 25.3.1998 (Braz.).

35. See supra note 8.

36. Vazquez, supra note 28.

37. See supra note 5.

38. Downing, Azevedo & Bram, supra note 9.

39. Nairobi Treaty on the Protection of the Olympic Symbol, Sept. 26, 1981, 1863 U.N.T.S. 367.

40. See Decreto No. 90.129, de 30 de Agosto de 1984, Diário Oficial da União [D.O.U.] de 31.8.1984 (Braz.); Brand Protection Guidelines: Advertising Market and Advertisers: Version 2, at 44, http://www.rio2016.com/sites/default/files/users/flavio/brand_protection_guideline_for_advertising_market.pdf.

41. Lei No. 12.035, de 1 de Outubro de 2009, Diário Oficial da União [D.O.U.] de 2.10.2009 (Braz.).

42. Downing, Azevedo & Bram, supra note 9.

43. Glickman & Eliason, supra note 24.

44. Id.

45. Decreto No. 41.839, de 29 de Abril de 2009, Diário Oficial do Rio de Janeiro [D.O.E.R.J.] de 30.4.2009 (Braz.).

46. Decreto No. 30.379, de 15 de Maio de 2009, Diário Oficial do Rio de Janeiro [D.O.E.R.J.] de 16.5.2009 (Braz.).

47. Lei No. 18.184, de 2 de Junho de 2009, Diário Oficial do Minas Gerais [D.O.E.M.G.] de 3.6.2009 (Braz.).

48. Lei No. 9.763, de 1 de Outubro de 2009, Diário Oficial do Belo Horizonte [D.O.M.B.H.] de 2.10.2009 (Braz.).

49. Lei No. 11.472, de 14 de Maio de 2009, Diário Oficial do Bahia [D.O.E.B.] de 15.5.2009 (Braz.).

50. Lei No. 7.720, de 2009, Diário Oficial do Salvador [D.O.M.S.] de 2009 (Braz.).

51. Lei No. 13.987, de 26 de Março de 2010, Diário Oficial da São Paulo [D.O.C.S.P.] de 27.3.2010 (Braz.).

52. Lei No. 14.870, de 29 de Dezembro de 2008, Diário Oficial da São Paulo [D.O.C.S.P.] de 30.12.2008 (Braz.).

53. Int’l Olympic Committee, Report of the IOC 2018 Evaluation Commission 35, 70 (2011), available at http://www.olympic.org/Documents/Commissions_PDFfiles/Evaluation_Commission/FINAL_DRAFT_2018_EV_COM-ENG.pdf.

54. Id. at 104.

55. Special Act on Support for the PyeongChang 2018 Olympic and Paralympic Winter Games, Act No. 11226, Jan. 26, 2012, as amended (S. Kor.); see Laura Walden, Special Act to Support PyeongChang 2018 Allows for Personnel and Budget Provisions, Sports Features Comm. (Jan. 21, 2012), http://www.sportsfeatures.com/olympicsnews/story/49284/exclusive-special-act-to-support-pyeongchang-2018-allows-for-personnel-and-budget-provisions.

56. Protecting Intellectual Property against Ambush Marketing, Grey Market and Counterfeiting: Korean Perspective, ABA (Mar. 2015), http://www.americanbar.org/content/dam/aba/events/international_law/2015/03/2015%20Asia%20Forum/protecting4.authcheckdam.pdf.