Posted: March 3rd, 2012
By Joseph Norman *
Someone in the blogosphere each year talks about the National Football League’s zealous [some might say overzealous] enforcement of its SUPER BOWL registered trademark. But the truth is, the Super Bowl is one of the most highly sought after commodities in the commercial world. The Super Bowl is the most highly watched American television event in America’s favorite sport; in 2011, 111 million people watched the Super Bowl on Fox, and this year 111.3 million viewers tuned in to see the Giants beat the Patriots. Compare that with American Idol, where a paltry 20 million viewers watched the finale. Yawn. Actually, have a look at the five most watched TV shows ever. Four Super Bowls. This is why advertisers and promotional partners are willing to pay millions for seconds of television time during the Super Bowl; simply, it’s the most watched, and anticipated, TV event each year.
The game will generate an estimated $210 million in revenues just from television advertisers, not to mention revenues from sponsorships and other licenses. Assuming that sponsorships and other licenses related to the Super Bowl are equal to television ad revenues, total revenue generation could equal over $400 million in one four-hour event. In other words, the NFL generates 4% of its annual revenue (based on 2010 total revenues of $9.3 billion) in four hours on a Sunday in February. (Recognizing that Fox will receive the television ad revenue—not the NFL—but surely the NFL considered this in its contract with Fox. So, the assumption that the NFL made at least what Fox did on the deal still holds).
It only makes sense that the NFL would fight any dilution of its Super Bowl mark, because such dilution lessens the overall value of the Super Bowl event and brand. If other non-licensed advertisers can use the SUPER BOWL mark without having to pay for it, then licensed advertisers are not going to be willing to pay as high a premium because part of the mark’s exclusivity is lost (see discussion here). Any successful business is going to protect its brand equity; just because the NFL chooses to do so ardently, that does not make it a villain.
To enforce its SUPER BOWL mark, the NFL plays a sort of 2-deep zone on potential infringers; it checks infringers at the line with cease-and-desist letters but usually not litigation, and the infringers know that going over the top is trouble because the NFL has built a reputation for aggressively protecting its marks in court. (h/t to Ron Coleman at Likelihood of Confusion for the zone analogy). The zone element of the NFL’s enforcement program is in the rational economics of potential litigation. Potential infringers are wary of challenging the marks usage in court because they believe that the NFL will devote significant economic resources to litigation, which the infringer may not have. As a result, a buffer zone is created by the threat of expensive litigation, under which cease-and-desist letters work to check infringement.
Assuming an advertiser has chosen to not seek a license to use the SUPER BOWL mark, it is in a bit of a quandary. On one hand, associating your commercial enterprise with the most popular event of the year is the preeminent advertising opportunity. On the other hand, choosing to chance the NFL’s enforcement policy can be very expensive if the league brings suit.
Some intellectual property commentators assert that trademark protections can be avoided in certain situations, i.e., when just referencing trademarked products. Intellectual property law recognizes the so-called “nominative fair use doctrine,” which basically just allows the use of the trademark to describe the product or service. Like if you tried to describe a pair of Air Jordan basketball shoes, saying “really expensive and highly sought after, basketball shoes immensely popular with kids and named after the greatest basketball player ever” does not really convey the same idea and makes it difficult to talk about Air Jordans even in the non-commercial context. The test comes from New Kids on the Block v. News America Publishing, Inc.:
[w]here the defendant uses a trademark to describe the plaintiff’s product, rather than its own, we hold that a commercial user is entitled to a nominative fair use defense provided he meets the following three requirements: First, the product or service in question must be one not readily identifiable without use of the trademark; second, only so much of the mark or marks may be used as is reasonably necessary to identify the product or service; and third, the user must do nothing that would, in conjunction with the mark, suggest sponsorship or endorsement by the trademark holder. 971 F.2d 302.
Unfortunately for advertisers, this nominative fair use exception does not extend to using the trademark to suggest endorsement or sponsorship associated with the mark. In other words, the nominative fair use doctrine does not allow advertisers to use the term “Super Bowl” to help promote their products without securing a license.
So what are advertisers to do? Well, a couple have chosen to rely on creativity to associate their product with the Super Bowl. Like Chipotle, whose “Super Big Internationally Televised Professional Football Bowl Game Half Price Party in a Box promo?” has flagged the interest of many on twitter. Chipotle is clearly toeing the line when it comes to the NFL’s mark enforcement policy.
But the ad’s creative use of font and size — and other ads like it which the ordinary consumer would clearly associate with the Super Bowl — is not likely to be challenged in court by the NFL (not saying they would not send a strongly worded cease-and-desist letter). It is almost humorous to imagine the NFL arguing in court that Chipotle’s ad infringes on the SUPER BOWL.
So is creatively working around the SUPER BOWL mark the answer? At least in Chipotle’s case it appears to be. Surely, however, the NFL will not let creative liberties go unchecked. That is — when an ad goes beyond a certain, as of yet undetermined, point the NFL will likely challenge a creative usage of the mark. What results is a gray area where creative promoters or advertisers can garner the value of the SUPER BOWL brand without a license. Finding a spot in that gray area where the NFL will not choose to litigate is the key for advertisers.
* Joseph Norman is a third-year law student at Wake Forest University School of Law. He holds a Bachelor of Science in Management from North Carolina State University and an MBA in Finance from the McColl School of Business at Queens University of Charlotte. Prior to enrolling in law school, Mr. Norman worked for Wells Fargo Wealth Management in Equity Research. Upon graduation in May 2012, Mr. Norman will practice corporate law.