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Advertising used to be about informing consumers where the
products they purchased came from and which person or corporation
was responsible for their manufacture. However, over the past
50-60 years, advertisers have been striving to give brands an image
or identity, which induces consumers to buy the brand as much as
the underlying product to which it is affixed. Brands have
therefore become valuable economic assets in their own right.
Whilst the words and logos that are protected by trade mark
registration represent a very small part of the overall branding
strategy of a corporation, trade mark law is still an obvious
starting point for protecting a corporation's brand.
Trade mark law has traditionally focused on preventing second
uses of a trade mark where a consumer is likely to be confused into
thinking that the second user's goods originate from the trade
mark owner. In other words, according to early trade mark
law, trade marks only functioned as indicators of origin.
However, the developments in branding outlined above, mean that
consumers no longer care who manufactures their products as long as
they are "official" products.
Part I of this paper looks at how trade mark
law in the US and Europe has started to take into account this
shift in the way that consumers interact with brands and to protect
the brand image/equity that brand owners create in their
marks. In particular we shall see how the US legal
commentator Schechter called for a change in the law, as early as
the 1920s. In fact, Schechter claimed that preserving the
distinctiveness that a mark acquires through advertising was the
"only rational basis for trade mark
protection."1
Part II will go on to consider how the Court
of Justice of the European Union (CJEU), in its eagerness to
recognise the changed interaction between consumers and trade
marks, has developed its own concept of marks have
advertising/communication/investment functions in addition to their
essential (origin) function. Whilst this is an exciting
development for brand owners, it is unclear from the CJEU's
dicta when these functions are infringed. It seems that the
Court could benefit from delving a little deeper into exactly what
these functions represent and the rationale for protecting
them.
Part III considers how consumers interact with
modern marks and shows that the
advertising/communication/investment functions are at least partly
attributable to the fact that consumers are vulnerable to corporate
selling messages contained in advertising. In some cases,
consumer loyalty to particular brands may be described as being
irrational (at least in the psychological sense of the word).
Therefore, the CJEU needs to ensure it does not protect the new
non-origin functions absolutely, as this would be far from being
the rational basis for protection that Schechter
envisaged.
Having performed the above analysis, part IV will look at three of the most common
models proposed for trade mark protection: misappropriation,
property and harm-based theories. It will then consider which
of these models is best suited to protecting the brand value/equity
that modern marks have acquired and will examine how having a
concrete legal basis for trade mark law could assist the CJEU in
future cases.
Footnote
1. F. Schechter, 'The Rational Basis of Trademark
Protection' (1926-277) 40 Harv. L. Rev. 813, 831
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