Olympic Trademark Tyranny: The IOC’s Aggressive Mark Protection Harms Athletes

By Erin Milnes

August 24, 2016

International Olympic Committee - Olympic flagThe XXXIst Summer Olympics may have concluded Sunday, but the International Olympic Committee’s aggressive protection of the Olympics® trademark continues unabated. Like the NFL with the Super Bowl® (that is, “the Big Game”) and the NCAA with March Madness® (AKA “Hoops Hysteria”), the IOC and its U.S. affiliate, the USOC, is ferocious in defending its mark.

Unlike the NFL, however, the IOC has managed to put in place regulations that prohibit sponsors of individuals from publicizing their athlete’s achievements unless the company ponies up millions to become an official sponsor of the Olympic games.

Of course, the IOC should be able to protect the Olympic brand and the income that flows from it, but these draconian restrictions go too far. Most Olympians need the support of sponsors to excel in their sport, and pay the rent. The IOC’s aggressive practices are harming the athletes, the games, and ultimately sporting excellence itself.

Ambush Marketing and Trademark Bullying
A little background on trademark: We’ve all seen merchandise that uses well-known logos without permission. Companies also engage in this kind of “ambush marketing” by connecting themselves to a huge brand like the Super Bowl or Olympics without permission. Obviously, organizations like the NFL and IOC want to defend their mark and should have the right to do so. But some companies use their clout for trademark bullying of entities engaged in legitimate practices. Aggressive trademark protection can become trademark tyranny.

Standard Trademark Protection
Typically, a company or an organization defends its trademark from ambush marketing by sending an enforcement letter to the offender based on the trademark owner’s prior use or registration. Often that letter (and the fear of litigation behind it when a powerful company is involved) is enough to stop the offender’s behavior. If, however, the behavior continues and litigation begins, the defending company would have to prove that the behavior is likely to cause confusion in the marketplace or to dilute the mark, both of which claims require analysis of many factors (similarity of marks, relatedness of goods and channels of trade, intent, etc.).

The IOC’s Special Treatment
Because the Olympic Games take place over a short time, and litigation is often a slow process, the IOC asked bidding countries to enact legislation giving special trademark protection to the Olympic properties to prevent ambush marketing. The Ted Stevens Olympic & Amateur Sports Act established the U.S. Olympic Committee and gave it exclusive rights to use and license various Olympic properties, including the rings and the words Olympic and Olympiad.

As explained by Chanel L. Lattimer in IPWatchdog, “More importantly, the Act allows the USOC to bring civil action against unauthorized users…. In essence, the USOC can seek injunction to prevent the unauthorized use of the Olympic properties … without proving likelihood of confusion.” Whoa. Lack of due process much?

On top of this special treatment, the IOC enacted Rule 40 in 2012, which creates an advertising blackout period for non-Olympic sponsors before, during, and after the games. That means individual athlete sponsors who aren’t also official sponsors of the Olympic Games were unable to leverage their athlete’s greater visibility from July 27 to August 24 of this year.

Don’t Quit Your Day Job
Violating Rule 40 can result in potentially career-ending penalties for the athletes, so ignoring it is not an option. The prohibition–essentially a gag order–leaves athletes unable to take advantage of their marketability during the most high-profile competition in their sport.

Most Olympians earn nothing for Olympic competition (winners do get a medal bonus from the USOC, though it’s much lower than that of many other nations). The great majority compete as amateurs the rest of the year, so endorsements and sponsorship are the only source of income from their sport. A 2012 study of top U.S. track athletes found that the average competitor earned less than $15,000 per year, including sponsorships, prize money, and grants. (Guess you’ll be living at Mom’s for a few more years.)

Meanwhile, IOC execs are living large. According to Will Hobson of the Washington Post, “The picture that emerges is a multibillion-dollar entertainment industry whose entertainers are, in this country, often expected to raise their own income or live in poverty.” (Some examples from Hobson: USA Triathlon CEO Rob Urbach makes $362,000 while Team USA triathletes compete for stipends that range from about $20,000 to $40,000 a year. When on IOC business, members fly first-class, stay in luxury hotels, and also get cash per diems: $450 per day for regular IOC members, $900 per day for the IOC’s executive committee.)

Time for a Change
Women’s athletic apparel maker Oiselle may help rein in this bullying by taking on the Ted Stevens Act. The company has long butted up against  the IOC’s restrictions, even publishing a ‘primer’ on Rule 40 last March. Then, this July, the IOC requested that Oiselle remove all images of track star Kate Grace from the company’s social media and desist from using captions such as “She’s heading to Rio” because they amounted to Olympic-related advertising. Oiselle has sponsored Ms. Grace for five years and believes their comments on her successes were simple reportage, not advertising.

Oiselle founder Sally Bergesen wants to fight back and level the playing field so athletes share some of the Olympic revenue. “The way we see it, it’s just not right in terms of how smaller sponsors are being iced out and then at the same time, the USOC is not compensating the athletes. It’s so exploitative,” said Ms. Bergesen to Flotrack.

Coverage of the matter is growing. The Los Angeles Times ran a critical story on Rule 40 earlier this month. Drake University trademark law professor Shontavia Johnson called the IOC out in the Washington Post last week: “I believe these laws have been stretched too far. As currently applied, it’s hard for companies, especially small businesses, to know when their activities are illegal. And it’s increasingly difficult to obtain permission to do the right thing.”

I agree and sincerely hope Oiselle’s Bergesen can build a coalition of smaller companies to challenge the IOC juggernaut and bring about common-sense regulations. We can protect the IOC’s ability to raise money for the games and individual athletes’ ability to raise money to pursue sporting excellence. I’m afraid, however, that this struggle will require an Olympic, that is, monumental, effort.

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BTW, if you’re in the mood for a laugh with your explanation of the IOC’s aggressive stance, this SBNation video should satisfy.

The International Olympic Committee’s trademark tyranny: promoting the brand, the games, the athletes, or the IOC?

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