Iconic luxury car maker Ferrari’s recent victory in a trademark dispute against a group of car enthusiasts, while notable as a landmark one in Italian trademark law, also provides pointers for trademark counsel on how they should approach enforcement when the infringement is by fans.

NCTM Studio Legale Associato assisted Ferrari in its action against an unofficial Ferrari owners’ club before the Italian Supreme Court, which found the Ferrari Club of Milan – a non-profit organisation – had infringed Ferrari’s various trademarks, including the ‘prancing horse’. The Supreme Court decision, analysed previously on WTR Daily, upheld an appeal brought by Ferrari, stating that a non-profit organisation can be held responsible for trademark infringement. Paolo Lazzarino, partner at NCTM Studio Legale Associato who assisted Ferrari, told WTR that “it is an important case as it clarifies two aspects (on acquiescence and commercial use of a trademark) that were previously unclear.”

One interesting aspect to the dispute is that the action came against a group that actually celebratesFerrari’s product. In this instance, the iconic nature of the Ferrari brand was the over-riding concern, with Lazzarino explaining: “Ferrari is not against the fact that there are car owners gathering, uniting and doing associated activities, that is not the point. The point is respecting the use of the logo. The use of the ‘prancing horse’ is something that is very valuable to Ferrari. There is no challenge against the association,per se, or against people owning a Ferrari – the problem is how such associations use the trademarks of the company. I think that it is a very basic principle of trademark law. For example, if I want to establish a group of Coca-Cola fans, I would be quite circumspect when it comes to using their logo in public events and trips, where an admission fee is charged.”

However, Lazzarino notes that “Ferrari does not treat this kind of unauthorised activity in the same manner as that of a common infringer, at least in the non-contentious initial stage,” tailoring its approach to take account of the buy-in and affinity that the infringers have to the brand. While Lazzarino is reluctant to answer questions specifically on Ferrari’s strategy for brand enforcement, he does note that that, generally speaking, there should be a balance when dealing with fans who infringe upon trademarks: “There must be a healthy balance between the exclusive rights of the trademark owner and the uses by third parties that cannot free ride on the goodwill attached to it. I understand that it is a difficult and delicate balance, but trademark owners cannot simply waive their rights because a group of fans want to organise public events.”

It’s clearly a tricky balancing act. In an exclusive interview for the upcoming edition of WTR, the chief in-house trademark counsel of Jack Daniels Properties Inc, David Gooder, explains that he is all too familiar with fans infringing upon registered trademarks, noting: “We will always try to be reasonable with people and to do everything in the same voice and spirit of the brand. There is nothing worse than a brand that speaks one way to its consumers via its marketing messages, but then turns around to deal with an infringer – especially one who is essentially a fan – and takes a very aggressive, belligerent attitude”.

Gooder continues: “We handle hundreds of infringements a year – many from fans who have done something that they thought would be fine, but then discover it is actually harmful to the brand. Usually, they are then willing to stop. That kind of volume creates a management challenge, even if the legal substance might not. But either way, we handle these matters in a way which will protect the brand and keep the fan as a ‘friend of Jack’, if at all possible.”

Of course it is not always possible to avoid legal action but, when handled the right way, and in line with the brand’s perceived character, the results can be positive. In this instance, Lazzarino observes that the Italian media have given this case a “good echo”. Perhaps this is proof – if any were needed – that dealing with fans differently from the common infringer will not just protect the trademarks but also the image of the brand.

This blog was first published in World Trademark Review on 17 December 2013

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