Hackney Council couldn’t quite believe it when it saw its 40 years old logo on a range of Nike sportswear. Nike said it was celebrating Hackney Marshes as all that was great about amateur football. Have the London Borough’s rights been infringed?
Who: Hackney Council and Nike
Where: May 2006
Using the heading "On Your Bike Nike!", the website of the London Borough of Hackney makes it clear the Council feels aggrieved by Nike and it all stems from the use of logos…..
Hackney Council's logo is a round letter 'H' surrounded by the words 'The London Borough of Hackney'. It has been used by the Council since its creation in 1965 on public buildings, council vans, staff uniforms and street signs. To Hackney Council's dismay, Nike are currently using the logo on a new range of t-shirts, vests, trainers and footballs to celebrate the history of Hackney Marshes, widely considered to be the home of the English Sunday League. Nike feels the logo acts as a symbol of all that is great about amateur football and its use coincides with the 2006 World Cup. Hackney Council alleges Nike never sought permission to use its logo in this way so has threatened the sports giant with litigation.
Hackney Council have asked Nike to withdraw all merchandise using the logo until the parties can reach a settlement about this issue. In Hackney Council's opinion, the way to settle this matter would be for Nike to provide financial compensation which the Council could use for the development of sport within the borough. Hackney's Mayor Jules Pipe has said that one way for Nike to compensate the Council would be for it to provide them with a fair percentage of the retail price of the clothing range and to provide sportswear for every school child in the borough.
At the time of going to press it is understood from conversations with the Council that the parties held an initial meeting to discuss this matter and they are shortly due to enter into further discussions. Hackney Council has hinted that it hopes Nike will make a fair offer of settlement to prevent the matter having to reach the courts.
Why this matters:
Hackney Council has never sought to register its logo as a registered trade mark but this does not mean it is without grounds to take action against Nike for their use of the logo. Other potential claims the Council could rely on include:
1. Passing off – As confirmed by the Eddie Irvine/Talksport case in 2002, the courts have recognised that a false claim of endorsement constitutes passing off. To succeed with such an action, the Council would need to prove it has a significant reputation and goodwill in commercial activity carried on under the branding in question and that Nike's action of creating sportswear featuring its logo constitutes a misrepresentation resulting in Nike's market believing the sportswear is endorsed, recommended or approved of by the Council. This would have to be at least likely to cause the Council financial loss. Here the Council, by reason of its public body status, may have difficulties on the issues of whether it has actually carried on business under the brand and also whether Nike's activities are likely to cause them financial loss.
2. Copyright – Assuming that the Council is the legal owner of any artistic copyright vesting in the logo design (as opposed to any third party commissioned to create it), it may be that the Council has a potential claim for copyright infringement due to Nike's act of reproduction without consent.
This dispute acts serves as a good reminder to all marketers and manufacturers that they must always stop and think when they want to make any use of images or logos used by a third party. Just because a logo has not been registered as a trade mark does not necessarily mean you can use it as you please. Trade marks are just one of many rights that must be considered when clearing a marketing campaign and associated merchandise. Proceed with caution if you are going to imply that a third party is somehow associated with your product or campaign.
Osborne Clarke London