How can brands protect both their intellectual property and reputation when disputes are increasingly played out in public?
A few months ago, Hotel Chocolat founder Angus Thirlwell took Waitrose to task on social media over the infringement of a Registered Design relating to the brand’s curvy chocolate slabs. Hotel Chocolat made all the right moves: they sought legal advice, sent a cease and desist letter, and entered into discussions with the retailer. Meanwhile, they maximised their publicity by appealing to Waitrose customers with a product amnesty, encouraging them to exchange their copycat slabs for the real thing, and – not insignificantly – took the high ground on social media.
It paid off, as two weeks later Waitrose agreed to discontinue the range, rather than enter into a lengthy and expensive legal battle whose outcome would have been far from clear.
The role of social media
Whereas a ‘strongly worded’ and formal legal letter used to be par for the course when it comes to trade mark challenges, the nature of social media means that potential disputes and legal exchanges can be made public and shared around the world in seconds, often garnering support for the underdog. When a family-run Birmingham pub found itself at odds with craft beer brand BrewDog, for instance, it was buoyed by a wave of support on social media channels.
When a company follows the right trade mark process to protect their brand, it is obviously going to smart when they get word of an infringement. The temptation to go in all guns blazing is high, but they increasingly have to consider the overall impact of both the infringement and any potential PR their reaction might cause. Companies are increasingly taking non-traditional approaches when it comes to raising their concerns and thinking more carefully about what a win actually looks like.
Social media context
Context is everything. Unfortunately, the brevity and immediacy of social media means that often there is little room or time to give the right frame of reference to more complex issues. In the heat of the moment, a tweet accusing a competitor of intellectual property infringement can be sent – and shared – in seconds.
This might not be detrimental to a brand’s reputation if the accusation turns out to be correct, but much will depend on how the dispute is reported. The speed of today’s news does not always allow for accuracy, and the risk of serious brand damage is even greater if an IP threat turns out to be unjustified or if the language and approach is at odds with the brand’s values.
Hotel Chocolat and Waitrose both operate at the higher end of their respective markets. During the two-and-a-half week dispute, Hotel Chocolat played its hand cleverly and managed to stay true to its brand, using the slab amnesty to turn the disagreement into a positive customer experience. It also emphasised the superiority of its product without resorting to below-the-belt social media punches. The ‘underdog’ was right from the outset and emerged as the clear brand victor on every front.
In the BrewDog case above, however, things were very different. The rebellious craft beer brand threatened legal action against a family-run pub called Lone Wolf, arguing that the name would lead to confusion with BrewDog’s own vodka brand of the same name.
Regardless of whether the ‘punk’ brewery had a legitimate claim or not, its actions were at odds with its own brand values – in fact, it had previously been scornful of “petty pen pushers” launching claims against it, as when the estate of Elvis Presley took issue with the name of BrewDog’s Elvis Juice beer – leading to accusations that the brewery was acting like just another callous corporate machine. Following a strong online backlash, BrewDog backed down and issued an apology in a blog post.
Aside from the risk of damaging their brand, companies also need to be aware of the potential legal risks when issuing threats of infringement. In legal terms, a “threat” is any communication that would cause a reasonable person to understand that the claimant holds a registered IP right and intends to initiate an infringement action against the other party. It can be private and direct to the party, or a mass public message – such as a social media post, an advert, or a media statement. A threat is “unjustified” if the IP right in question does not actually exist, if it has expired, or if no infringement of the right has actually occurred.
Brands will sometimes use unjustified threats to pressure others into removing products from sale – harming their business in the process – as a proxy for bringing legal proceedings against the other party when they in fact have no intention of actually starting legal action.
However, thanks to the UK “threats provisions” (most recently the Intellectual Property (Unjustified Threats) Act 2017, which came into force last October), the recipients of unjustified threats can themselves bring proceedings against the IP owner to put a stop to such practices. A successful claimant can obtain an injunction preventing further threats, damages and their legal costs. Any request to cease selling or using a product, any reference to legal proceedings, or any dramatic “See you in court!” posts on social media should therefore be considered very carefully in case it constitutes an actionable unjustified threat.
Such cases are rare, but can be used strategically to create a lot of damage if used in the right way. That’s why it’s always worth seeking expert professional legal advice before launching in – however tempting it may be!
Should you take action just because you can?
The BrewDog example illustrates the point perfectly. Is it worth pursuing supposed infringements by small, independent brands that are clearly not providing any real competition or confusion? Taking legal action might result in a win, but if it causes significant brand damage in the process it might not be worth it. A David vs Goliath narrative is a media favourite but could be disastrous in PR terms. Before proceeding, brands must always weigh up their options and decide what they can put up with and what constitutes a dealbreaker.
If you are going to take action, it’s worth thinking creatively about how best to tackle the problem and whether a traditional “cease and desist” letter is even the best option these days.
Netflix’s “cease and desist” to an unauthorised bar called “Stranger Things” – of the same name as the highly popular Netflix Original drama – was a stroke of genius. Instead of legal speak, the letter said Netflix didn’t want to come across as a “wastoid” and asked the bar owners not to make them “call your mom”, but left the recipients in no doubt as to their intentions. The letter went down an absolute storm on social media, boosting both Netflix’s legal position and their kudos in a single masterstroke.
It is therefore always advisable to seek professional legal counsel when it comes to IP infringements. Talking through the legal (and creative!) options available before posting angry accusations on Twitter will give everybody some thinking time. More importantly, it gives brands a chance to decide what ‘winning’ really looks like and prevent an unjustified threats action that could lead to potentially damaging repercussions. Who knows, you might even get some good publicity out of it if you play your cards right!