United States: Clearing Advertising And Promotion - Cutting Edge Creative

The most successful promotions gain awareness from creative exploitation of the brands and properties of the partners in your promotion. One of the keys to reducing the risk of being sued over your promotional materials is to make legal review an integral part of the creative process. Dealing with the legal issues up front --before money is spent toward production --will allow you to take necessary (and often easy and inexpensive) steps to avoid costly and embarrassing situations later on.

Before the creative process begins, make sure that you have a signed contract that clearly defines who is responsible for what. Then, as you consider different creative executions and you identify the rights that need to be obtained, it should be clear who will be responsible for obtaining any necessary permissions. Keep in mind that it has become increasingly more difficult to clear rights because of the exponential increase in copyright and trademark rights and the number of individuals and businesses registering and policing such rights, particularly sports and entertainment celebrities who may also pursue their expanding rights of publicity.

The Legal Rights Which May Affect Content Include:

1. Copyright
2. Trademark including trade dress, and anti-dilution rights
3. Unfair Competition/Passing off
4. Right to Publicity
5. Right to Privacy
6. Contract rights previously granted affecting one of the above. (For example, an exclusive right to use a trademark has been previously granted to another.)
7. Special rules regarding the use of "the Olympics" trademarks, national symbols and currency.
8. Special rules for web sites.

The Elements Which Implicate These Rights Include:

1. Artwork Do you own the copyright rights or have you obtained the necessary releases for the recognizable artwork that you are using? You may even need releases for the contents of the artwork, for artwork that is only partially visible, or artwork embodied in packaging.
2. Endorsements And Testimonials. Have consumer endorsements been obtained before the consumers were told that they would appear in advertising, i.e. are they impartial? Have you obtained endorser's certificates?
3. Film Footage. Have you obtained a release from the copyright owner? Have you obtained any necessary releases for the contents people and music) of the footage? Have you dealt with any applicable union issues?
4. Flags And Governmental Materials. Does the use of a flag or other governmental materials (seals, insignias, money, stamps, and monuments) falsely suggest the endorsement or authorization of a government entity? Are the materials being used in accordance with applicable law?
5. Locations. Have you obtained location releases? Does the use of a building in the background falsely suggest the endorsement or authorization of the owner or tenants of that building?
6. Look-Alikes Sound-Alikes And Impersonations. Do you have permission from the impersonator? Have you determined whether it is advisable to obtain permission from the person being impersonated as well?
7. Music Do you have the necessary permissions to use the composition, the master, and the principle performers? Have you dealt with any applicable union issues?
8. Names Or Likeness Of People Have you obtained all of the necessary releases? Does new computer technology raise issues not previously addressed, such as sampling? If you take one feature from a face, a nose or an ear of a celebrity and construct a new face is that an invasion of their rights to privacy or publicity?
9. Organization Names Or Insignias. Does the use falsely suggest the endorsement or authorization of a third party? Are any permissions necessary? Are you using trademarks properly?
10. Parodies. Have you determined whether the parody could subject you to a claim of trademark or copyright infringement? Are you using the parody to comment on another work? Are you copying only what is necessary? Does the parody falsely suggest the endorsement or authorization of a third party?
11. Photographs. Have you obtained releases both from the owner of the copyright (e.g. the photographer) and from the people pictured?
12. Props. Prop releases may be needed or advisable if the use of the prop newspapers, books, maps, toys, products, and distinctive clothing or jewellery) could subject you to a claim of trademark or copyright infringement or to a claim that the use falsely suggests the endorsement or authorization of a third party .
13. Disclaimers. Are the disclaimers adequate, are they clear and conspicuous? Are they in close proximity to the claim they explain?
14. Quotations. Have you obtained the necessary releases? Are you using a quote that fairly represents the entire work quoted from?
15. Titles Of Movies. Books. Periodicals. Songs Etc. Does the use fairly suggest the endorsement or authorization of the author, producer, singer, etc?
16. Trademarks And Identifiable Products. Does the use fairly suggest the endorsement or authorization of the owner/ manufacturer? Are you .using the products in a disparaging manner? Are you using the trademarks properly? Does the use "dilute" the rights of the owner?

Whenever you use another person's copyrighted material, trademark, name picture, likeness or voice, you must consider the possibility that your advertising or promotional materials may imply that person's authorization or other voluntary association More and more claims , against advertising are grounded in §43(a)(1) of the Federal trademark statute, otherwise known as the Lanham Act. It provides a cause of action where anyone can establish that a communication "is likely to cause confusion as to the affiliation, connection, or association of the [advertiser] with another (person, firm or organisation), or as to the origin, sponsorship, or approval of the [advertiser's] goods, services, or commercial activities by [the other person, firm or organization] ." 15 U.S.C.A. § 1125(a)(1)(A).

The claimant does not have to prove that the consumers believe it has endorsed the advertised product or service. It only has to prove that consumers think it has authorized or agreed to be referenced or implicated in the advertising or the promotion. Thus the final hurdle when creating advertising or promotional materials that will some way allude to, or reference matters associated with another entity is to avoid ambiguity about any connection such as, for example, with the use of a disclaimer .

Copyrightable material may be used without copyright infringement ( when, for example, the execution is sufficiently generic, the use is a "fair use" under the Copyright Act. or the material has entered the public domain) but there may be liability if consumers think that permission was obtained from the Copyright holder or someone who is associated with the material. Similarly, an informational use of another's trademark (used in proper trademark form to identify the other entity's product or service) that does not infringe conventional trademark rights by causing confusion as to the source of the product, may still provide a basis for a claim if -the ad gives the impression that permission was obtained from the owner of the trademark. Perhaps most significantly, where the use of a person's name, picture, likeness or aspect of a celebrity's persona is implicated in advertising or promotional materials does not violate that person's right of publicity because it falls within one of the recognized exceptions to that right (such as advertising an artist's work or truthfully advertising the subject matter of a publication), there may still be a claim if consumers assume that the person or celebrity had given permission.

Perhaps the best illustration of these problems is the Woody Allen case, were the use of Woody Allen's name, picture and likeness in an advertisement did not establish a copyright, trademark or publicity rights claim, but did win an injunction based on confusion as to Woody Allen's relationship to the advertising. Allen v. Nat'l Video. Inc." 610 F Supp. 612 (S.D.N. Y. 1985). The advertisement for a chain of video rental stores featured a Woody Allen look-alike renting videocassettes of Woody Allen films. The use of movie titles and the copyrighted artwork on the video cassette packaging were permissible as a fair use. Even Woody Allen's picture and name on the Annie Hall packaging was protected under the artist's exception to the right of publicity. A video rental store that rented Woody Allen films can exploit all of these rights to publicize Woody Allen's films being available for rental or sale. More importantly, the use of the look-alike did not violate Woody Allen's right of publicity under New York law, because it was clear that it was only a look-alike. However, the court found that all of these other-wise permissible uses, together with Woody Allen's obvious interest in encouraging rentals of his films, created a likelihood of confusion about whether he had voluntarily authorized the promotion.

The question of whether there is a likelihood of confusion about whether an individual has given permission to be referenced or portrayed may depend on the context and the commercial nature of the use. Compare Estate of Presley v- Russen, 513 F. Supp. 13399 (D.N.J. 1981) (look-alike stage performance suggests permission) with John Enterpr. v. Allen, 795 F. Supp. 349 (W.D. Wash. 1992) (film biography does not imply authorization) Ginger Rogers v. Grimaldi, 875 F. 2d 994,997 (2d Cir. 1989) (movie titled 'Ginger and Fred" does not imply any involvement of Ginger Rogers).

Have you cleared all of the possible rights? Even where you clear copyrights, trademarks, and do not use any person's name, picture or likeness, you have to consider the possibility of a claim by someone who is merely associated with materials included in an advertisement.

In the leading case in this area, Vanna White --the "letter turner" on Wheel of Fortune -- sued over a print advertisement for Samsung Electronics which depicted a robot on the "Wheel of Fortune" set dressed in an evening gown, wearing large jewellery and playing the role of the "letter turner" thirty years in the future. Even though the owner of the copyright in Wheel of Fortune did not object to the advertisement. and Vanna White had no rights in the program or in the role she played (and was the second person to play this role), she claimed that she would necessarily be associated with this advertisement. The jury agreed, finding that consumers would believe that she had endorsed the product advertised. White v. Samsung Electronics Am., Inc.. 971 F. 2d 1395 (9th Cir. 1992), rehearing en banc denied, 989 F. 2d 1512 (1993) (Kozinski, J, dissenting), cert. denied. 508 U.S. 951-(1993). Consider carefully before asking permission if you intend to go ahead anyway. See Wendt v. Host Int'l. Inc., 50 F. 3d 18 (9th Cir. 1995); Wendt v. Host Int'l Inc., 125 F. 3d 806 (9tb Cir. 1997) (the set from the TV show Cheers including two robot patrons that do not resemble the actors, subject to a jury trial of claims by the actors who played Cliff and Norm). See Abdul-Jabar v. General Motors Corn.. 85 F. 3d 407,409 (9th Cir. 1996) (an Oldsmobile television commercial that aired during a basketball tournament and which posed the question "Who holds the record for being voted the most outstanding player in this tournament?" and then answered, "Lew Alcindor"). Considering the success generally of celebrities arguing almost anything to a Los Angeles jury, the prospect of a jury trial against a celebrity, at least in Los Angeles, is cause for great concern.

Any web site is enhanced by being integrated into the World Wide Web. The easiest way, to do this is to include hypertext linkages to permit the user to immediately jump to another site. The context and form of hyperlinks will determine the risk that any hyperlink creates confusion as to whether it is authorized by the owner of the other site. It may be necessary to limit references to other entities to trademarks, including domain names to ordinary text (highlighted to indicate a hyperlink), as use of logos may imply more of a connection. TicketMaster sued over Microsoft's deep linking into TicketMaster's site, bypassing introductory and advertising material. The case was settled. ¹

Framing another entity's site when users hyperlink also creates potential liability. In addition to copyright claims, the framed site may claim that this, too, may imply authorization or confusion as to the relationship. Several newspaper sites objected to Total News Inc. hyperlinking users to their sites while supplanting some of their advertising banners with the Total News frame. ² Again, you should consider the context and appearance of the screen you create. For now, common sense and practical concerns about the financial impact of your actions will be the most significant guide to avoiding liability. To be held liable for contributory infringement, you must be found to "knowingly co-operate in illegal and tortious activity". ³ Thus, if you are aware of such an infringement and you do not delete the infringing material; you may be held liable for the trademark infringement.

Hijacking potential hits by using competitor's trademarks invisibly in your site's metatags or address will not likely create a claim under the Lanharn Act. In the absence of some communication of the nature of the connection or link, consumers may be confused.

Competitors have brought claims based on this practice, and they have obtained injunctions against the practice. Oppendahl & Larsen v. Advanced Concerts 97 Cir. Z -1592 D.C. Colo. 7123197; SNA Inc. v- Array, Cir. 97-7158) Cir. 97-3793 (E.D. Pa. 619/99).

"Disclaimers are a favored way of alleviating consumer confusion as to source or sponsorship." Consumers Union. Inc. v. General Signal corn.. 724 F 2d 1044, 1052-53 (2d Cir. 1983), cert. denied, 469 U.S. 823 (1984). An explicit statement that there is no voluntary association by the famous entity may be necessary to communicate this message effectively to the consumer to whom the advertising is directed. See Allen v. Men's World Outlet. Inc.. 679 F. Supp. 360 (S.D.N. Y 1998). However, the burden will be on tile advertiser to prove that a disclaimer in the context of the particular communication has been effective. See Home Box Office v. Showtime/ The Movie Channel, 832 F2d 1311 (2d Cir. 1987). Whether a disclaimer has been effective may have to be proven by consumer perception surveys.

The factors that are likely to influence whether or not a disclaimer is effective include its size, placement, legibility and consistency with the remainder of the message. Thus, the FTC Policy Statement on disclosures suggests that disclosures must be of a sufficient size and duration (where applicable) to be easily read and that they must generally appear in close proximity to the representation which they clarify or explain. See FTC Policy Statement. 2 Trade Reg. Rep. (CCH) 7569.09 at L2166. Similarly, the FTC's guides for the Advertising of Warranties and Guarantees states that the FTC will consider disclosures required by the guides to be properly made in television commercials if the commercial makes the disclosure simultaneously with or immediately following the claim and the disclosures are made in the audio portion, or, if in the video portion, they remain on the screen for at least five seconds. 16 C.F.R. § 239.2 n. 1; see also e.g., 15 U.S,C.A. § 1333 (requiring that the Surgeon General's warning on cigarettes be set off in a separate box in the advertisement). The television networks generally require that visual disclaimers be superimposed on a commercial for a minimum period of time (set by each network), and that they be, in most cases, approximately twenty two scan lines in height, and appear on a contrasting background or utilize drop-shading or other means to enhance readability if they are not black-on-white or white-on-black.

Courts generally favor disclaimers that are short and simple --for example, this product "has not been prepared, approved, or licensed by any entity that create or produced the [other product]."See Twin Peaks Prods.. Inc. v. Publications Int'l. Ltd.. See Twin Peaks Prods.. Inc. v. Publications .Int'l. Ltd.. 996 F. 2d 1366 (2d" Cir. 1993). Some courts have insisted that the disclaimer not only identify the advertiser, but state "without authorization of. .." where there is reason to think that there may be grounds for confusion. See Allen v. Men's World Outlet. Inc., 679 F. Supp. 360 (S.D.N. Y. 1988).

Labelling the product as "unauthorized" or otherwise incorporating the word "unauthorized" into a headline or the name or title of the product will increase the likelihood that consumers will not misled. However, in a recent case one court was persuaded that the word "unauthorized" in a box on the cover of the book was too high up and not sufficiently close to the title and that the box was a bad color. The court suggested that "unauthorized" should be incorporated into the title and should also be placed on the spine of the book so that all consumers would see it. See Toho Co. v. William Monow. 1998 LEXIS 12337 (C.D. Cal. 1998) (Godzilla book published in advance of new Godzilla movie and licensed companion book). Thus, reliance solely on disclaimers may be too risky.

Finally, some courts have also expressed the concern that even though initial consumer interest generated by a less-than-clear communication is later clarified by a disclaimer, the disclaimer may still be inadequate to protect the plaintiff. See Mobil Oil corn. v. Pegasus Petroleum Corn.. 818 F. 2d 254 (2d Cir. 1987); Toy Mfrs. Of Am. Inc v. Helmesley-Spear. Inc.. 960 F. Supp. 683, ~79 (S.D.N. Y. 1997); Clinique Labs, Inc. y:.Depp Corp.. 945 F. Supp. 547, 551 (S.D.N. y 1996); see also J. Thomas McCarthy, McCarthy On Trademarks and Unfair Competition, § 23:6 (4th ed. 1997). Thus reliance solely on disclaimers may be too risky. These problems should inform the creative process from the outset so that the overall context of the promotion can be shaped accordingly.

1 TickerMaster v. Microsoft, Inc., 97 Civ. 3055 (C.D. Calif. 2/28/97)

2 Washington Post Co. v Total News Inc., 97 Civ. 1190 (S.D.N.Y. 2/20/97)

3 J. Thomas McCarthy, McCarthy on Trademarks and Unfair Competition, § 25:02 (4th ed. 1997)