IP Views

A Threat To Goals and Glory: Ambush Marketing in the Philippines

May 22, 2012
By Jefferson Wilfredo P. Ferrer

Rebirth of Philippine Sports and Athletes’ Publicity

Over the recent years, Filipinos have taken an exceptional interest in sports, particularly in football. This is largely due to the unprecedented success of the country’s Philippine football team, more popularly known as the Azkals.

With their growing popularity, the Philippine Azkals have become marketers’ budding choice for brand endorsers. They are offered sponsorship deals left and right. Individual players are racking up offers for a variety of endorsement stints. Brothers James and Phil Younghusband, Team Captain Aly Borromeo, Anton Del Rosario and homegrown talent Chieffy Caligdong are among the Azkals who have signed individual endorsement contracts with a wide variety of brands.

Though the Azkals’ careers as brand endorsers have only just begun, it may well be under threat of an early finish following the growing threat of what is termed “ambush marketing.”

The threat of ambush marketing

Ambush marketing has been defined as “the practice whereby another company, often a competitor, intrudes upon public attention surrounding the event, thereby deflecting attention toward themselves and away from the official sponsor”. 1 Authors are in agreement that it can be accomplished in an indefinite number of ways. 2

The first reported incident of ambush marketing happened during the 1984 Los Angeles Olympic Games.3 Fuji was the worldwide film sponsor of that year’s edition of the games. However, Kodak, Fuji’s rival film brand, was able to obtain sponsorship rights over the live television broadcast of the games on the ABC channel.

In another example, Nike was accused of ambushing the official sponsorship rights of Adidas during the 1996 Atlanta Olympic Games.4 Nike filled up all billboards of the city of Atlanta with its own advertisements and built the Nike village just beside the official athlete’s accommodation. 5

In a more recent incident, Coca-Cola put up an online site where it made it appear that animated polar bears were reacting in real time to the 2012 Super Bowl while chatting with the site’s subscribers.6 Pepsi was this year’s official Super Bowl drink sponsor.

Ambush marketing threatens the rights of events organizers, athletes and their official sponsors. For one, ambush marketers are unjustly enriched, to the detriment of official sponsors. They enjoy, without spending anything, the goodwill of an event that the organizers were able to build up through sponsorship agreements. Second, ambush marketing breaches the contractual right of official sponsors to exclusive representation during events and in relation to their athlete endorsers. This could result in substantial loss to the sponsors considering that their investments, in one example, could reach up to as much as $125 million for the right to be exclusively affiliated with the event as its official presenter.7 In another example, it could reach as much as $50 million for signing up a Manny Pacquiao for endorsements.8

Lastly, by making it appear that their brands and products are associated or affiliated with a major event or an athlete as a sponsor, ambush marketers commit trademark infringement of the rights of events as a brand in themselves.9 They cause “confusion as to sponsorship”10 – that is, as to affiliation, connection, or association of the goods or services of a person to another as to its origin, sponsorship, or approval. 11

Given the economic repercussions to events and official sponsors, ambush marketing may lower the willingness of companies to invest in their athlete endorsers.

The Philippines’ response

In one of the regional patent attorneys’ conferences, it was reported that like many of its regional counterparts, the Philippines has yet to pass specific legislation to arrest the threat of ambush marketing.12 But it was pointed out that a variety of broad coverage laws may to some extent present a viable solution to the threat.13

Examples of such laws are the following:

articles 19 , 20 and 21 of the Civil Code of the Philippines (collectively known as the abuse of rights doctrine)
article 22 of the Civil Code of the Philippines (on unjust enrichment)
article 110 of the Republic Act No. 7349 also known as the Consumer Act of the Philippines
section 169.1 of the Intellectual Property Code of the Philippines

Especially notable among these laws are Article 22 of the Civil Code in the Philippines and section 169.1 of the Intellectual Property Code. This writer finds that these provisions are more relevant and provide more viable protective measures against ambush marketing as compared to the other provisions of law previously mentioned.

Section 169.1 of the IP Code guards against the likelihood of confusion as to affiliation, connection, or association of the goods or services of a person to another as to its origin, sponsorship, or approval. The ultimate objective of ambush marketers is to make it appear that their brands and products are associated/ affiliated with a major event as a sponsor or at the very least, have been permitted to make a similar connection. They desire to “free load” on the popularity of the major event. Given the premises, the case of ambush marketing seems to fall within the purview of the Section 169.1 of the IP Code.

In the same vein, ambush marketing may well constitute unjust enrichment. As earlier discussed, events attain popularity and prestige through the long years of its existence along with the sizeable investments made upon it. Ambush marketers are able to hinge on the publicity built up by events organizers and on the “airtime” rightfully owned by official sponsors to little or no cost at all.

A Harder Hit

We could only imagine the sense of accomplishment that Manny Pacquiao is enjoying from his triumphs as an athlete and from an extensive assortment of other roles. Expected to gross as much as $50 million from endorsement deals alone, all that he should be worrying about is his future encounters inside the boxing ring. But given the many-sided damage that ambush marketing potentially causes to endorsers and sponsors alike, the Pambansang Kamao may just have to deal with more than a suckerpunch to the gut.

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1 Tony Meenaghan, Point of view: Ambush marketing - Immoral or imaginative practice? Journal of Advertising Research, (1994) p. 79

2 Rico V. Domingo, Philippines: Special Topic for Discussion, Anti-Counterfeiting Committee 55th Asian Patent Attorney’s Association (APAA) Council Meeting Singapore, available at http://www.apaaonline.org/pdf/APAA_55th_council_meeting/anticounterfeitingcommittee/ Special_Topics_Report_of_Philippines_Anti-Counterfeiting_Group.pdf (last accessed 21 May 2012) ; See e.g. Oxford University Press (OUP), Ambush Marketing, available at http://fds.oup.com/www.oup.com/pdf/13/9780199696451_chapter1.pdf (last accessed 16 May 2012)

3 Bayless Ambush Marketing is Becoming A Popular event at Olympic Games. The Wall Street Journal, 8 February 1988

4 Why Ambush Marketing Is Winning, available at http://www.managingip.com/Article/3025211/Why-ambush-marketing-is-winning.html (last accessed 17 May 2012)

5 Oxford University Press (OUP), Ambush Marketing, available at http://fds.oup.com/www.oup.com/pdf/13/9780199696451_chapter1.pdf (last accessed 16 May 2012) citing Matthew Davis, Games Eagle-Eyed Sponsor Police, available at http://news.bbc.co.uk/2/hi/europe/3565616.stm (last accessed 14 August 2004)

6 Why Ambush Marketing Is Winning, available at http://www.managingip.com/Article/3025211/Why-ambush-marketing-is-winning.html (last accessed 17 May 2012)

7 Lynn Adler, Olympics – From Torches to Arena Floors, UPS Delivers, Reuters (2012) available at http://uk.eurosport.yahoo.com/22032012/2/olympics-torches-arena-floors-ups-delivers.html (last accessed 21 May 2012)

8 Meegnahan supra note 1

9 To the author, ambush marketing cannot be an act of unfair competition. Among the various ways by which unfair competition is carried out, Infringement of the right to publicity seems to be the most relevant and applicable to the case of ambush marketing. Author Thomas J. McCarthy cites the case of Eagle’s Eye Inc. v. Amber Fashion Shop Inc. in explaining that the said right to publicity applies only to natural persons and not to “corporations, partnerships or institutes”. Hence, ambush marketing against the Olympic Games cannot be an act of unfair competition.

10 4 RUDOLF CALLMAN, CALLMANN ON UNFAIR COMPETITION, TRADEMARKS AND MONOPOLIES 22-84 (2004)

11 An Act Prescribing the Intellectual Property Code and Establishing the Intellectual Property Office, Providing for its Powers and Functions, and for Other Purposes [IP CODE] Republic Act no. 8293, sec. 169.1 (a) (1997)

12 Domingo supra note 5

13 Id.

14 “Article 19 - Every person must, in the exercise of his rights and in the performance of his duties, act with justice, give everyone his due, and observe honesty and good faith”

15 “Article 20 - Every person who, contrary to law, wilfully or negligently causes damage to another, shall indemnify the latter for the same”

16 "Article 21 - Any person who wilfully causes loss or injury to another in a manner that is contrary to morals, good customs or public policy shall compensate the latter for the damage”

17 “Article 22 - Every person who through an act of performance by another, or any other means, acquires or comes into possession of something at the expense of the latter without just or legal ground, shall return the same to him”

18 “Article 110 - False, Deceptive or Misleading Advertisement. — It shall be unlawful for any person to disseminate or to cause the dissemination of any false, deceptive or misleading advertisement by Philippine mail or in commerce by print, radio, television, outdoor advertisement or other medium for the purpose of inducing or which is likely to induce directly or indirectly the purchase of consumer products or services. “An advertisement shall be false, deceptive or misleading if it is not in conformity with the provisions of this Act or if it is misleading in a material respect. In determining whether any advertisement is false, deceptive or misleading, there shall be taken into account, among other things, not only representations made or any combination thereof, but also the extent to which the advertisement fails to reveal material facts in the light of such representations, or materials with respect to consequences which may result from the use or application of consumer products or services to which the advertisement relates under the conditions prescribed in said advertisement, or under such conditions as are customary or usual”

19 “Section 169. False Designations of Origin; False Description or Representation xxxSection 169.1 - Any person who, on or in connection with any goods or services, or any container for goods, uses in commerce any word, term, name, symbol, or device, or any combination thereof, or any false designation of origin, false or misleading description of fact, or false or misleading representation of fact, which: (a) Is likely to cause confusion, or to cause mistake, or to deceive as to the affiliation, connection, or association of such person with another person, or as to the origin, sponsorship, or approval of his or her goods, services, or commercial activities by another person xxx”

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